Marshall v Northumberland & Durham Property Trust Ltd
[2022] UKUT 92 (LC)

In this appeal, as a condition of dispensation from the obligation to consult, the Upper Tribunal reduced the amount that the landlord was entitled to recover from leaseholders by 15%.

The FTT had granted unconditional dispensation on the ground that the works were urgent. That was incorrect, said Martin Rodger KC in the Upper Tribunal, referring to Aster Communities v Chapman [2020] UKUT 177 (LC):

“The exercise of the jurisdiction to dispense with the consultation requirements stands or falls on the issue of prejudice”.

He held that the landlord’s failure to consult properly had caused prejudice because Mr Marshall had been unable to nominate a contractor, and the landlord’s contractor had therefore carried out works without a second quote having been obtained.

On the evidence, had Mr Marshall been consulted, he would have nominated a contractor who would have quoted for the work. A second quote would have allowed the managing agent to negotiate with its contractor. Martin Rodger KC therefore held that:

“For the necessarily inexact purpose of determining the terms on which dispensation should reasonably be granted I will assume that, in the more competitive environment which proper consultation may have created, a price of £13,000 plus VAT might realistically have been negotiated (representing a reduction of about 15%)”.

As the case related to dispensation, the landlord was also ordered to pay Mr Marshall’s legal costs and disbursements.