DAEJAN INVESTMENTS LTD V BENSON [2013] UKSC 14, [2013] 1 WLR 854, [2013] 2 ALL ER 375

Abstract

In this important case on the Landlord and Tenant Act 1985 (as amended by the Commonhold and Leasehold Reform Act 2002) the Supreme Court, by a bare majority, allowed the appeal against the decision of a Leasehold Valuation Tribunal (LVT) which had been affirmed by, first, the Upper Tribunal (Lands Chamber), and, secondly, by the Court of Appeal. Almost all long leases of flats contain an obligation on the landlord (or a service company) to provide services, such as repairing the exterior and common parts of the block, and a concomitant obligation on the tenants to pay service charges. The right of the landlord to recover such service charges depends on the terms of the particular lease, but the 1985 Act and the Service Charges (Consultation Requirements)(England) Regulations 2003 impose certain statutory requirements and restrictions on a landlord, which impinge on its ability to recover service charges. These requirements are designed to ensure that tenants of flats are not required (i) to pay for unnecessary services or services which are provided to a defective standard, and (ii) to pay more than they should for services which are necessary and have been provided to an acceptable standard.