Supreme Court waves goodbye to Gala

Supreme Court waves goodbye to Gala

In an eagerly awaited judgment by the Supreme Court handed down today, Lord Briggs in First Port Property Services Limited -v- Settlers Court RTM Company Limited & Others [2022] UKSC 1 overturned the Court of Appeal’s decision in Gala Unity Limited -v- Ariadne Road RTM Co Limited [2013] 1WLR988.  Gala interpreted a right to manage company’s management functions under the Commonhold and Leasehold Reform Act 2002 (the “2002 Act”) as being sufficiently wide as to include the management of property outside the relevant building and which was also enjoyed by third parties with no nexus to the right to manage company or the lessees of the relevant building. That gave rise to a concept that there would or could be a “dual management” scenario.

The thorough judgment of Lord Briggs determined that the Gala decision was “wrong” and produced “absurd” results that were plainly not intended under the 2002 Act.

The Supreme Court further clarified that in relation to the management functions enjoyed by a right to manage company under the 2002 Act, such management was concerned only with the relevant building together with nearby appurtenant property over which the lessees of the relevant building enjoyed exclusive rights. The Supreme Court has therefore interpreted the management functions of a right to manage company on a significantly narrower basis than in Gala (and other authorities).

In respect of any RTM or other property related disputes, please contact the property litigation team at Colman Coyle on +44 (0)20 7354 3000 or

Neil Curbison
Coronavirus Act 2020 – Business Tenancies

Coronavirus Act 2020 – Business Tenancies

The government have now enacted provisions to prevent forfeiture claims being brought against businesses as a result of the crisis.

From the 26 March 2020 to 30 June 2020 (the “relevant period”), a landlord’s right of re-entry or forfeiture arising from non-payment of rent cannot be enforced. The relevant period can be extended beyond 30 June 2020 by the Secretary of State.

Conversely, during the relevant period, a landlord cannot be said to have waived his or her right of re-entry or forfeiture, unless it is done expressly in writing.

The result of these provisions is that from 26 March 2020 until 30 June 2020, no order for possession can be enforced and any order for possession made during that period must take effect after 30 June 2020.

During the relevant period, businesses affected by the crisis may be unable to pay their rent. Previously, under the Landlord and Tenant Act 1954, landlords could oppose the grant of a new lease protected by that Act by asserting the ground under section 30(1)(b) i.e. that there has been a  persistent delay in paying rent which has become due. The Coronavirus Act provides that any failure to pay rent during the relevant period is to be disregarded under the Landlord and Tenant Act 1954.

While the proposals grant tenants welcome protection during these difficult times, it does leave landlords with mounting rent arrears which may affect their ability to pay their own mortgages and outgoings. The Government has said that a mortgage holiday will be provided by lenders and the Financial Conduct Authority has produced guidance on this issue.

Coronavirus Act 2020 – Residential Tenancies

Coronavirus Act 2020 – Residential Tenancies

On 18th March 2020, the Government issued a press release stating that emergency legislation would be introduced to “suspend new evictions from social or private rented accommodation while this national emergency is taking place” and “no new possession proceedings through applications to the court to start during the crisis”.

The Coronavirus Act (“the Act”) entered into force on 25 March 2020. The Act refers to a relevant period within which these provisions will apply. That period is defined as beginning on 26 March 2020 and ending on 30 September 2020.

The Act applies to a variety of tenancies: Protected and Statutory; Secured; Flexible; Assured; Assured Shorthold; Introductory; and Demoted. For all these the Act extends the notice period for commencing possession proceedings to three months.

The three-month notice period can be extended to up to six months, but not above six months. This period can be changed multiple times.

A possible issue with this variation is that if the notice period is changed to six months, there is no provision for varying notices already served using the three-month period. It seems likely that such a notice would still be valid. In that case, proceedings would commence at the end of the three-month period but would still be within the now six-month notice period.

During the three-month notice period, any rent arrears that accrue can still be used as grounds for possession proceedings once the relevant period comes to an end. The Act merely changes when these proceedings can take place. Tenants who have lost their income due to the crisis will still be the subject of a possession claim.

This is particularly notable as the Act provides a solution to this issue for business tenancies. For the purposes of making out the ground of persistent delay in paying rent which has become due under the Landlord and Tenant Act 1954, any failure to pay rent during the relevant period is to be disregarded.

On top of this, the Act makes no provision for notices validly served prior to the passage of the Act. A notice validly served prior to the Act becoming law will be valid and will lead to new proceedings during the relevant period. Some of which, no doubt, will have been caused by the Coronavirus crisis. This is, of course, subject to Courts being able to hear such claims.

Boundary Disputes: A new resolution process on the horizon

Boundary Disputes: A new resolution process on the horizon

The Property Boundaries (Resolution of Disputes) Bill is currently making its way through the legislature.  In an effort to reduce the number of boundary disputes being dealt with in the Court system, the new bill proposes a procedure whereby a party wishing to resolve a dispute as to the position of a boundary must serve notice upon the neighbouring owner identifying where they assert the exact line of the boundary is and include a relevant plan.  The neighbouring owner then has 14 days within which to agree or object.  The default position in the event the neighbour objects to the proposed boundary or fails to respond is that a dispute is deemed to have arisen.  The process is therefore similar to the mechanics of the Party Wall etc. Act 1996.

Once the notice has been served and in the event a dispute is deemed to have arisen, the new bill prescribes that a single surveyor (agreed by both parties or if a single appointment is not agreed, by three surveyors consisting of one appointed by each party and a third independent surveyor) will determine the exact line of the boundary.

If either party does not agree with the Judgment of the surveyor (or the three surveyors) then either party has 28 days within which to appeal the decision to the High Court.

Absent an appeal, the determination of the surveyor(s) can be registered at the Land Registry.

This would then leave any claims for trespass etc. to be determined separately between the parties in the normal course.

It is not clear when or if the proposed new bill will come into law but it is an interesting proposition.

In the event that you require any advice or assistance in relation to boundary disputes or trespass claims arising out of the same, you can contact Neil Curbison (a partner in the Real Estate Dispute Resolution Team at Colman Coyle) or Adam Palmer (an Associate in the Real Estate Dispute Resolution Team at Colman Coyle) to discuss matters on 020 7354 3000.

Neil Curbison

Boundary Disputes: A new resolution process on the horizon

Compulsory Purchase Orders, EC1

Colman Coyle has recently accepted instructions to act for various long leaseholders (both residential and commercial) concerning potential Compulsory Purchase Orders (CPO’s) relating to the proposed re-development of the Triangle Estate, Goswell Road, EC1.

The proposed redevelopment of the Triangle Estate includes the demolition of 6 dwellings together with the central podium and garages together with certain retail units.  The proposal includes the construction of 54 new dwellings with private amenity space and additional retail floor space.

Compulsory purchase is the legal function that allows certain public bodies to acquire land, for a specific purpose, if the land owner is not willing to sell by agreement.  The powers to acquire land or rights over land for a particular purpose are set out in various Acts and can involve complex considerations.

Persons with an estate or interest in land that is acquired compulsorily have a right to claim compensation.  The three main elements of compensation relate to the open market value of the land taken, any loss caused by losing possession of the land (known as disturbance compensation) as well as any compensation for damage to any land that is retained by the affected party.

Colman Coyle are regularly instructed in relation to matters arising out of CPO’s and in the event that you require any advice and assistance as to developments affecting your property or business, please do not hesitate to contact Neil Curbison on 020 7354 3000.

Neil Curbison

Boundary Disputes: A new resolution process on the horizon

Does a Use Clause Prevent Underletting and does such a Use Clause fall foul of the Unfair Terms in Consumer Contracts Regulations 1999 (Upper Tribunal (Lands Chamber))

Neil Curbison of Colman Coyle had conduct of the successful appellant’s appeal in Roundlistic Limited v Jones & Another [2016] UKUT 325 (TCC) which was recently handed down by the Upper Tribunal (Lands Chamber).


The case concerned a building divided into two maisonettes.  Our client is the freehold owner of the building.  The lower maisonette was let under a long lease dated 8th September 1978 but the upper maisonette was not let under a long lease.  The lower maisonette lease was renewed under the statutory renewal process in 2012.

The lease of the lower maisonette contained a use clause to the extent that the lower maisonette was not to be used for any purpose whatsoever other than as a single private dwelling house in the occupation of the Lessee and his family.

Our client sought a determination from the First Tier Tribunal (FTT) that the Lessee of the maisonette was in breach of the aforementioned use clause by virtue of the fact the Lessee had sub-let the maisonette under an Assured Shorthold Tenancy (AST) to persons not related to the Lessee.  Our client relied upon the FTT’s decision in Aaron William M Burchell v Raj Properties Limited [2013] UKUT 443 (LC) and warned the Lessee that any such sub-letting would be a breach for which a determination would be sought as a prelude to forfeiture.

The initial determination by the First Tier Tribunal (FTT) found that whilst the use covenant prohibited the tenant from using the maisonette other than as a single private dwelling house in the occupation of the tenant’s family, an estoppel by convention was deemed to have occurred preventing enforcement of the covenant by our client and also that the landlords conduct amounted to a waiver of its right to enforce the breach.

Secondly and in the alternative, the FTT determined that the use covenant amounted to an unfair contract term under the Unfair Terms in Consumer Contract Regulations (UTCCR) 1999.

Successful Appeal

On appeal, the Upper Tribunal (Lands Chamber) (UT) accepted that the FTT’s decision as to estoppel and waiver were flawed and accepted that our client had been acting consistently with its obligations and was not in breach and therefore no estoppel or waiver arose.

Lease Renewal Issues –UTCCR 1999

The determination regarding the application of UTCCR 1999 made by the UT in this matter is important for a variety of reasons and in particular when considering its application to lease renewals.

The original lease of the Respondent’s maisonette was extended under the Leasehold Reform, Housing and Urban Development Act (LRHUDA) 1993 following the service of a section 42 notice in 2012.

Under the LRHUDA 1993 lease renewal process, the terms of the new lease are to be the same as the original lease subject to very limited grounds for amendments.

At the date of the original lease, the UTCCR 1999 was not in existence and did not apply.

However, the FTT determined that at the time of the renewal, UTCCR 1999 did apply and that the clause was unfair and unenforceable.

It was successfully argued in the UT that Regulation 4(2) of the UTCCR 1999 prevented the regulations from applying to the lease as it expressly stated that UTCCR 1999 did not apply “to contractual terms that reflect – (a) mandatory statutory or regulatory provisions …”.  The renewal of the lease in 2012 was of course granted only because the tenant at the time had exercised their right under statute and our client landlord was then obliged to grant a new lease on the same or substantially similar terms.

The UT also accepted our arguments as to Regulation 5(1) of the UTCCR 1999 that the use clause was not unfair because it did not cause a significant imbalance between the parties.  The significant imbalance between the parties, if there had ever been one, was in existence before the lease renewal as it was a term of the original lease.  Any such imbalance therefore existed before the new lease was granted.  It could not, therefore, be said to have caused any imbalance.

Finally, the UT also accepted our argument that the covenant in the lease was not contrary to the requirement of good faith as specified in Regulation 5(1) of the UTCCR 1999.  The renewal lease was granted because the tenant at the time exercised their right to claim a new lease under LRHUDA 1993 and both the tenant at the time and the landlord were professionally represented during the course of the lease extension procedure and had taken advice on the terms of the lease at that time.

The UT decision serves as a warning to tenants to ensure their lease terms permit underletting.  More widely, the decision is a helpful and clear analysis of the effect of UTCCR 1999 in respect of lease renewals.

In the event that you have any property related disputes, you should not hesitate to contact Neil Curbison, a partner in the property litigation department at Colman Coyle on +44 (0)20 7354 3000.