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Mr Justice Fancourt handed down judgment in Jacobs v Chalcot Crescent Management Company Ltd [2024] EWHC 259 (Ch) on Friday 9 February, allowing an appeal against His Honour Judge Hellman’s order following a four-day landlord consent trial in Mayors and City of London Court in 2022. Fancourt J held, first, that it was not open to HHJ Hellman to decide the case on an issue which was not pleaded and, secondly, that in any event, HHJ Hellman was wrong on the facts to find that it was reasonable for a landlord to withhold consent on that un-pleaded basis.
HHJ Hellman dismissed a tenant’s claim for a declaration that his landlord had unreasonably withheld its consent to alterations to a duplex flat in a converted terrace house in St John’s Wood and instead granted the landlord a declaration that it had reasonably withheld consent. He found that three of the landlord’s reasons were unreasonable. One of those was the landlord’s concerns (on advice from a surveyor, Simon Levy) that the alterations would not comply with Building Regulations. The landlord’s surveyor during cross examination (when it was put to him that others more qualified disagreed with him about the Building Regulations) said that he was also concerned about the increased risk to the structure of the building in case of fire and that this was distinct from his concern about Building Regulations. During closing submissions, the landlord’s counsel submitted that it was reasonable for the landlord to refuse consent on the basis of that distinct concern. HHJ Hellman agreed.
On appeal, Mr Justice Fancourt was satisfied that the building structure point had not been pleaded and that it had not been part of the case until, “without advance notice”, it was raised in oral closing submissions. Given the way it was raised in closings, it was not clear that it was being relied upon as a self-contained reason for refusal and, had an application to amend have been made, it would have required the reopening of the trial. The court would therefore have been “bound to reject” it to avoid “serious injustice”. HHJ Hellman had refused permission to appeal on the basis that the structural integrity issue was central and that confronting it had been unavoidable. Mr Justice Fancourt held that “it was not a central issue: it emerged from nowhere at the trial only when Mr Levy chose to say something about it when asked about a different issue.” Confronting the issue, he held, would have been appropriate only if the trial were inquisitorial in nature but, “since it is adversarial and the structural integrity was not a pleaded issue for trial, it was not with respect right to confront it and make it the basis of the decision.”
Mr Justice Fancourt further held that it was unreasonable for the landlord to withhold consent without obtaining the advice of a fire engineer. It was unreasonable for the landlord to rely upon its surveyor’s general knowledge and experience when that surveyor accepted under cross examination that he would have been willing to cede his view to someone more expert.
Mr Justice Fancourt further held that, even if it had been reasonable to have a concern in that regard at all, there was a sensible alternative to refusing consent which was to grant consent conditionally on the tenant installing a misting system. This had been ruled out when Mr Levy believed the floor was wooden, but as soon as he discovered it to be concrete, he should have revisited this as “an obvious and more proportionate solution”. Fancourt J said that “it cannot be reasonable to object entirely to works of alteration to the interior layout of a flat when there is another, reasonable solution to an issue that would enable the works safely to proceed.”
Fancourt J set aside HHJ Hellman’s declaration and replaced it with a declaration that consent was unreasonably withheld.
Tom Morris appeared for the successful Appellant, instructed by Liam Bell at Memery Crystal.
A link to the decision can be found here.
