The Incorporated Trustees of the Dulwich Estate v Kaye & Ors [2006] EWLands LRX_137_2005 (11 September 2006)

LRX/137/2005

LANDS TRIBUNAL ACT 1949

SERVICE CHARGE  Landlord and Tenant Act 1985 s.27A  construction of lease  whether landlord’s renewal of a retaining wall on an undemised part of the estate was within landlord’s repairing obligation and could be included in service charge.

IN THE MATTER OF AN APPEAL FROM A DECISION OF THE LEASEHOLD
VALUATION TRIBUNAL FOR THE LONDON RENT ASSESSMENT PANEL

BETWEEN	THE INCORPORATED TRUSTEES	Appellant
OF THE DULWICH ESTATE

and
MRS QUETTA KAYE & OTHERS	Respondents

Re:	Houses and land at Little Brownings,
Frobisher Court and 51-59 Sydenham Rise,
London SE23

Before: His Honour Judge Huskinson

Sitting at Procession House, 110 New Bridge Street, London EC4V 6JL
on 4 September 2006

Mr Christopher Heather counsel, instructed by Forsters for the Appellant
No appearance or representation on behalf of the Respondents (Mr Prithvinath Saxena accompanied by others attended as an observer).

The following cases are referred to in this decision:

Ravenseft Properties v Davstone (Holdings) Limited  [1980] 1QB 12
Elmcroft Developments Limited v Tankersley-Sawyer [1984] 1 EGLR 47 
Lurcott v Wakely  [1911] 1KB 905
Plough Investments Limited v Manchester City Council [1989] 1 EGLR 244

DECISION
Introduction
1.	The Appellant appeals to the Lands Tribunal, with permission, from the decision of the Leasehold Valuation Tribunal for the London Rent Assessment Panel (“LVT”) dated 18 August 2005 whereby the LVT reached a decision as described below regarding the recoverability by the Appellant of certain sums by way of service charge from the Respondents under various leases whereby the Respondents hold their various separate premises on the Dulwich Estate from the Appellant. 
2.	The Appellant is the freehold owner of an area of land in Dulwich which I will call the Estate.  The Estate includes numerous houses and flats which the Appellant has demised on long leases.  The Estate also comprises areas which are not demised but are instead retained in hand by the Appellant, including certain roads and pathways and amenity areas.  The leases with which the Tribunal is concerned fall into three types:
(1)	Leases in the form of the specimen before me dated 20 July 1962 whereby the houses known as 1-26 Little Brownings were each separately demised (hereafter called “the Type 1 lease”).
(2)	Leases in the form of the specimen before me dated 18 June 1963 whereby the various flats in Frobisher Court were each separately demised (hereafter “the Type 2 lease”).
(3)	Leases in the form of the specimen before me dated 10 October 1975 whereby the houses at 28-36 (even) Little Brownings and 51-59 (odd) Sydenham Rise were each separately demised (hereafter “the Type 3 lease”).  
It should be noted that certain of the originally demised premises have subsequently been enfranchised, but it has been provided under the scheme of management that (in summary) so far as concerns service charges the parties should continue to be bound by the same provisions as would have applied if there had been no enfranchisement.  Accordingly for the purpose of the present service charge dispute the Appellant’s Estate can be analysed on the basis that all premises are subject either to a lease of Type 1 or Type 2 or Type 3.  
3.	This matter came before the LVT on an application by the Appellant under section 27A of the Landlord and Tenant Act 1985 whereby the Appellant applied for a determination as to the recoverability by the Appellant under the service charge provisions in the various leases of money spent by the Appellant in 2003 in rebuilding a retaining wall on a retained part of the Estate.  
4.	In summary the LVT concluded that the lessees bound by the Type 1 and Type 2 leases did have to contribute towards the costs of rebuilding this retaining wall, but the lessees holding under the Type 3 lease were not obliged to do so.  The LVT also decided that the Appellant was not entitled to seek under the service charge provisions of the leases to recover the costs of the proceedings through the service charge, but the LVT further concluded that if it had been necessary to do so the LVT would make an order under section 20C of the 1985 Act preventing any such charge being made.  
5.	The Appellant appeals to the Lands Tribunal only in respect of the determination by the LVT to the effect that under the Type 3 leases the Appellant is not entitled to recover anything in respect of the cost of rebuilding the retaining wall.  
6.	Initially the Respondents were minded also to appeal against the LVT’s decision and permission to appeal was sought from (and granted by) the LVT.  However subsequently the Respondents decided not to pursue their appeal.  The Respondents were notified of the Appellant’s appeal to the Lands Tribunal, but the Respondents (including the relevant Residents’ Association) decided not to respond to the Appellant’s appeal.  Accordingly at the hearing before the Tribunal the Appellant was represented by Mr Heather of counsel, but there was no appearance by or representation on behalf of the Respondents or any of them.  However Mr Saxena, accompanied by others, attended as an observer.  It is right to record that the mere fact that the Respondents did not appear and were not represented at the hearing does not, of course, mean that the Appellant’s appeal should for that reason be allowed  I would only accede to the Appellant’s arguments (even though not opposed by the Respondents) if I was satisfied that the LVT were wrong in their determination.  I have considered the Respondents’ material submitted to the LVT under cover of their Response (dated February 2005) and the Reply (dated 18 March 2005) and the matters raised in that Response and Reply.
The Facts
7.	To the east of numbers 1-21 (odd) Little Brownings there runs a pathway in an almost north to south direction.  To the east of this pathway there is shown on the Type 1 lease an area coloured mauve which is described in clause 3(ii) of such lease as an amenity space.  I hereafter call this amenity space the “Mauve Area”.  The Mauve Area is at a higher level than the pathway and is supported by a retaining wall.  Steps and paths lead up into the Mauve Area from the pathway and these steps and paths also have at their side a retaining wall structure for at least such distance as is needed until the necessary height has been achieved by the steps or paths.  It is this retaining wall, which runs along the east side of the pathway and also runs along the sides of the steps and paths into the Mauve Area, with which the present case is concerned.  
8.	The Type 1 lease does not expressly confer any right upon the lessee to use the Mauve Area, but it is not suggested by the Appellant that the lessee under such a lease enjoys no such right and it would appear to follow by necessary implication from Clause 3(ii) of the lease that such a right is conferred.  Clauses 3(ii) and (iii) comprise a covenant by the lessee to pay to the Appellant from time to time a fair and rateable proportion of certain expenses including: 
“(ii)	the expense of keeping the drainpipes, wires, cables and conduits serving the demised premises in complete repair and the amenity spaces coloured mauve on the said plan in a neat and orderly condition and the cost of re-turfing lawns and replacing dead or damaged trees, plants and shrubs
(iii)	the expense of maintaining repairing and renewing the retaining walls”.
9.	The Type 2 lease applies to the various flats comprised within Frobisher Court which lies to the south of Little Brownings and the Mauve Area.  The Type 2 lease shows the Mauve Area as coloured purple and also shows certain other areas as coloured purple.  Clause 2 (vii)(b) comprises a covenant by the lessee to pay the Appellant from time to time a fair and rateable proportion of certain costs and expenses including 
“(b) keeping the private footpaths, roads, verges, kerbs and ways amenity areas (coloured respectively yellow and purple on the said plan) in a good condition properly lighted and in complete repair and the cost of re-turfing lawns and replacing dead or damaged trees, plants and shrubs and maintaining and renewing the fences, retaining walls, boundary walls and entrance gates enclosing or contained within the estate of which the demised premises form part”
Type 2 lease does not confer any express right on the lessee to use the purple amenity area but such a right would appear to be conferred by necessary implication.
10.	The Type 3 lease applies to houses lying to the north of Little Brownings and the Mauve Area.  Under the Type 3 lease the definitions section includes a definition of “Amenity Areas” (which appear to be certain areas coloured mauve on plan No.2 to the lease) and also defines “the adjoining Amenity Areas” as meaning those parts of the adjoining estate of the lessors known as Little Brownings and Tarleton Gardens
“..... laid out by or on behalf of the Lessors for the enjoyment of the Lessor’s Lessees on the Estate and the said Adjoining Estate and by way of identification coloured green on the plan number two annexed hereto”.
Various areas are coloured green including a substantial area to the north of the premises which are subject to the Type 3 lease and also including the Mauve Area lying to the east of the pathway and the retaining wall referred to above.  
11.	Once again the Type 3 lease does not appear to confer any express right on the lessee to use the Amenity Areas or the adjoining Amenity Areas (which include the Mauve Area), but such a right would appear to be conferred by necessary implication having regard to the terms of the Type 3 lease including the covenants next mentioned, namely:
1.	By Clause 2(i) the lessee covenants to pay to the Appellant from time to time a fair and rateable proportion of the cost and expense incurred or expected to be incurred by the Appellant in the performance of their covenant under Clause 6(b) including (and without prejudice to the generality of the foregoing) the preparation of specifications and schedules in connection therewith and the fees charges and expenses of any expert consulted by them in connection therewith.
2.	Clause 6(b) comprises a covenant by the Appellant in the following terms:
“that (subject to (i) completion of the development and the laying out of the Estate by the Builders and (ii) contribution and payment as hereinbefore provided in Clause 2(i) hereof) the Lessors will at all times during the said term keep the private footpaths roads parking areas forecourts and paved areas belonging to or forming part of the Estate and the said Adjoining Estate and the verges and kerbs in good condition properly lighted and repaired until the same or any part of them are taken over by the Highway Authority and maintained at the public expense and will keep the amenity areas and the adjoining amenity areas in good condition and the fences and retaining walls boundary walls and entrance gates enclosing or contained within the Estate and the said Adjoining Estate properly repaired and also keep the sewers drains pipes wires cables and conduits serving the demised premises and other premises in good condition and repair.”
12.	It appears that the retaining wall was built in about 1961 and, when built, was built inadequately and not in accordance with certain then current Codes of Practice, see the Experts’ Statement of Facts Opinions on which agreement and disagreement has been reached (pages 84 and following of the bundle).  
13.	By 1995 the retaining wall had fallen into substantial disrepair and works were done to repair it which turned out to be inadequate.  This led to further deterioration.  
14.	The situation which was reached prior to the rebuilding works is summarised in the Experts’ Statement which includes in paragraph 1 an agreement that the retaining wall could “fail” for a number of stated reasons and in paragraph 2 includes the following:
“By ‘fail’, we agree that we mean the retaining wall was cracked, partially collapsed at one location and/or leaning to the degree that these faults would be very noticeable and alarming to the residents and clearly could only be corrected by rebuilding of the wall”. 
15.	The experts go on to agree what was the overriding cause of “failure” of the retaining wall (namely pressure from the retained soil and possible hydrostatic pressure) and they also agree that where the wall had “failed” due to excessive leaning, it could be due to a combination of ground movement beneath the foundation and also back pressure.  They agreed that where the wall had failed in shear as displayed by horizontal movement on a bed joint, this could only be due to back pressure from the contained soil.  They agreed that the retaining wall as built could not be justified by calculation to resist the forces due to contained soil at the heights previously constructed (typically 750mm above pavement level) and that at that height the wall should have been built as a steel reinforced concrete wall, with or without a brick facing to simulate the existing finish.  They agreed that this was a different construction to a different principle of design as compared with what was in fact built.  
16.	I read the Experts’ Statement as agreement that the retaining wall was already cracked and partially collapsed and/or leaning (to an extent that would be very noticeable and alarming) and that the retaining wall could fail further for various reasons as set out in paragraph 1 of the statement.  
17.	It appears in due course to have been accepted by the Appellant and the Respondents’ Residents’ Association that the appropriate way forward to tackle the problem was to adopt a design involving reinforced concrete supporting walls on wide footings and a brickwork facing (see paragraph 4 of the Respondents’ Response document dated February 2005 at page 49 and following of the bundle).  
18.	The rebuilding work to the retaining wall commenced in 2003.  In effect what occurred was that the retaining wall was removed and was rebuilt throughout almost all its length to the new specification.  In fact a small extent of the retaining wall was not entirely rebuilt, see a statement dated 7 September 2006 of Richard Anthony Bennett and accompanying plan sent to me after the hearing by way of answer to a factual question I raised at the hearing.  However for the purpose of the present argument I consider that the extent to which the old retaining wall was not rebuilt is insignificant.  I proceed on the factual basis most favourable to the Respondents (which also appears to have been the factual basis adopted by the LVT) that the retaining wall was to all intents and purposes entirely rebuilt.
Proceedings before the LVT
19.	It was not suggested by the Respondents at the hearing before the LVT: 
(a)	that this rebuilding of the retaining wall was an inappropriate course to take (indeed the parties’ experts agreed the faults could only be corrected by rebuilding);
(b)	that the method of construction adopted in rebuilding the wall was unreasonable; or
(c)	that the works were not carried out to a reasonable standard or that the costs were not reasonably incurred.
20.	However before the LVT the Respondents argued that they were not liable to contribute towards the costs of rebuilding the retaining wall because:
(a)	the need for the works arose from an inherent defect in the original construction of the retaining wall and that their obligations under their leases did not extend as a matter of law to paying for remedying an inherent defect; or
(b)	the wording of the leases was not sufficiently wide to cover the rebuilding works, which should be regarded as an improvement.  
21.	In its determination the LVT decided:
(a)	The retaining wall was out of repair and the works subsequently carried out were necessary (paragraph 14)
(b)	There exists no doctrine of law which operates to excuse the Respondents from having to contribute to the costs of remedying something which can be described as an inherent defect (paragraphs 20 and 21).
(c)	The complete rebuilding of the retaining wall constituted renewal rather than repair (paragraph 22)
(d)	The lessees under the leases of Type 1 and Type 2 were liable to pay their fair and rateable contribution towards the costs of rebuilding the retaining wall.  The LVT rejected the argument that the work should be treated as an improvement and outside the obligation to pay for “renewing” the retaining wall.  
(e)	As regards the lessees under the Type 3 leases, the relevant words were to keep the retaining wall “properly repaired” and that these words were insufficiently wide to extend to an obligation to renew the retaining wall by rebuilding it such that the terms of the Type 3 leases neither obliged the Appellant to do the renewal work nor the lessees to pay for such work.  
22.	The only part of the LVT’s decision challenged before the Lands Tribunal is the LVT’s decision regarding the position under Type 3 leases.  
Appellant’s Arguments
23.	On behalf of the Appellant Mr Heather advanced the following arguments.
24.	He first argued that, having regard to the agreed position in the Experts’ Statement, the state of the retaining wall prior to the 2003 rebuilding works was that the retaining wall was out of repair.  
25.	Mr Heather argued that it would have been futile to repeat the earlier type of works, whereby the retaining wall was sought to be put into repair by patching rather than dealing with the fundamental problem that it was an inadequate retaining wall and needed rebuilding.  Mr Heather pointed out that the experts agree that the retaining wall could only be corrected by rebuilding and that there was no suggestion that the chosen method of rebuilding was unreasonable.  
26.	Mr Heather invited the Tribunal to construe the relevant provisions of the Type 3 lease against a factual matrix which, he submitted, should include the terms of the Type 1 and Type 2 leases.  The argument was that the Type 3 lease should be construed in such a manner as to avoid divisive differences in position as between lessees under the Type 3 lease as compared with lessees under the Type 1 and Type 2 leases and that in order to do this the Tribunal should give a wide meaning to the words in the Type 3 lease so as to match the obligations in the Type 1 and Type 2 leases (which include an obligation to contribute to the cost of renewing the retaining wall).  Alternatively Mr Heather argued that the Tribunal should seek a construction of the relevant provisions of the Type 3 lease which avoids the Appellant being entitled to allow the retaining wall to fall into ruin.  
27.	Mr Heather submitted that in any event what the Appellant did regarding the retaining wall did not go beyond repair because:
1.	There is no doctrine of law to the effect that an obligation to “repair” is incapable of including the remedying of the result of an inherent defect in original construction, see Ravenseft Properties v Davstone (Holdings) Limited  [1980] 1QB 12.  
2.	The relevant wording in Clause 6(b) of the Type 3 lease is an obligation on the Appellant to keep the retaining wall “properly repaired”.  It was submitted that the adverb “properly” emphasised that any repair work must be done in a proper manner and confirmed that in a case such as the present, when the only proper manner of dealing with the problem was taking down and rebuilding the retaining wall, then this was covered by the obligation to keep the retaining wall “properly repaired”.
3.	It was submitted that in any event the Appellant could only keep the adjoining Amenity Areas (which include the Mauve Area) and the pathway to the west of the Mauve Area properly repaired if the Appellant rebuilt the retaining wall.  Doing nothing in respect of the retaining wall would lead to a want of repair in respect of the Mauve Area and the pathway and this would in itself constitute a breach of the Appellant’s repairing covenant which the Appellant would be obliged to remedy (and which the Appellant could charge to the Type 3 lessees as regards a fair and rateable proportion).
4.	So far as concerns whether as a matter of fact and degree the works to the retaining wall went beyond what could properly be required under a covenant to keep the retaining wall “properly repaired”, Mr Heather referred to Lurcott v Wakely  [1911] 1KB 905 and especially to the judgment of Cozens-Hardy MR at pages 194-195:
“That being so, it seems to me that we are driven to ask in this particular case, and in every case of this kind, Is what has happened of such a nature that it can fairly be said that the character of the subject-matter of the demise, or part of the demise, in question had been changed?  Is it something which goes to the whole, or substantially the whole, or is it simply an injury to a portion, a subsidiary portion, to use Buckley LJ’s phrase, of the demised property?  ......”
	“It seems to me that we should be narrowing in a most dangerous way the limit and extent of these covenants if we did not hold that the defendants were liable under covenants framed as these are to make good the cost of repairing this wall in the only sense in which it can be repaired, namely by rebuilding it according to the requirements of the County Council.”
28.	I asked Mr Heather what comparison fell to be made in a case such as this where we are not concerned with a lessee’s obligation to repair the demised premises but with a lessor’s obligation to repair parts of the retained estate.  In the former case the question is whether the rebuilding required is of a subsidiary part of the demised premises (in which case the lessee is obliged to do the works under a repairing covenant) or whether the rebuilding required is of the whole or substantially the whole of the demised premises (in which case the lessee may not be so obliged under a covenant to repair the demised premises).  Thus in such a case the comparison is between what is being rebuilt on the one hand and the entirety of the demised premises on the other hand.  However a different comparison has to be made where one is concerned with a lessor’s repairing covenant in respect of parts of the retained estate.  Mr Heather submitted that it would not be right to ask whether the whole or substantially the whole of the retaining wall needed to be rebuilt (if this question is asked then it is effectively the whole of the retaining wall which needed to be rebuilt).  Instead Mr Heather submitted the appropriate question is whether what the Appellant is being asked to do by rebuilding the retaining wall involves a rebuilding of the whole or substantially the whole of the subject matter of the Appellant’s repairing covenant, or whether instead the rebuilding of the retaining wall constitutes a rebuilding of merely a subsidiary part of the subject matter of the Appellant’s repairing covenant.  In the present case the repairing covenant is in respect of substantial parts of the Appellant’s estate including the private footpaths, roads, parking areas, forecourt, paved areas, verges and kerbs, amenities areas and adjoining amenities areas and fences, retaining walls, boundary walls and entrance gates.  So analysed Mr Heather submitted that the rebuilding of the retaining wall was merely renewing a subsidiary part of the subject matter of the Appellant’s repairing covenant.
29.	Mr Heather also referred to Elmcroft Developments Limited v Tankersley-Sawyer [1984] 1 EGLR 47 upon this question of fact and degree and the approach to be taken to it.  He also referred to Plough Investments Limited v Manchester City Council [1989] 1 EGLR 244 to show that it was for a landlord, where the landlord was obliged to repair a certain matter, to decide upon what were the reasonable remedial works.  
Conclusions
30.	With respect to the LVT I consider that their conclusion on the liability under the Type 3 leases was wrong.  My reasons for so concluding are substantially those advanced by Mr Heather in argument and are as follows.
31.	The appropriate starting point is to ask whether at the date prior to the Appellant carrying out the rebuilding works the retaining wall was in a state which could be described as “properly repaired”.  In the light of the Experts’ Statement the answer in my judgment must be in the negative.  The retaining wall was not at that date properly repaired.  Indeed it was in a state of substantial disrepair.  It had fallen into a condition substantially worse than that in which it originally was when first constructed.  It lasted in its inadequate state of construction for a substantial number of years, but then failed and the 1995 type works were ineffective.  By 2003 the retaining wall was in a state which was not “properly repaired”.  Prima facie therefore the Appellant was obliged to take steps to alter the situation because the Appellant was bound by a covenant to keep the retaining wall properly repaired. 
32.	On the facts and the Experts’ Statement it appears clear that the retaining wall could not have been put into a “properly repaired” state by any lesser works than those actually adopted.  Only rebuilding the retaining wall to a proper specification would suffice.  
33.	The position therefore as at 2003 so far as concerns lessees holding under the Type 3 lease was either:
(a)	the Appellant was obliged under Clause 6(b) of the lease to do these rebuilding works which were needed to ensure that there was a “properly repaired” retaining wall (in which case the lessees would be obliged to pay a fair and rateable proportion of the costs through the service charge); or
(b)	the Appellant was not obliged under Clause 6(b) of the lease to do such works (in which case the lessees would not be obliged to contribute through the service charge).  
34.	I reject Mr Heather’s argument that the Type 3 lease should be construed against a factual matrix which includes having open in front of one the wording of the Type 1 and Type 2 leases and which includes an assumption that the parties to the Type 3 lease intended the Type 3 lease to make the same or effectively the same provisions for repairs and service charges as in the Type 1 and Type 2 leases.  While the Appellant would have been aware of the terms of the Type 1 and Type 2 leases, there is nothing to suggest that the typical lessee under the Type 3 lease was made aware of the terms of the other leases.  
35.	However I do consider that I am entitled to have in mind, as part of the factual matrix against which the Type 3 lease should be construed, the fact that it would have been obvious to the parties to the lease that for the proper running of the estate and for the benefit of both lessor and lessee it was important that an effective code was put in place to ensure that wants of proper condition in the estate were put right in a prompt and reasonable manner.  It is unlikely that the parties to the Type 3 lease intended that a situation could arise where, rather than the lessees being entitled to enjoy an estate in proper condition, the lessees might instead find that the lessor was entitled to allow a part of the estate (in the present case a retaining wall) to fall into an ever increasing state of ruin (subject only to possible liability under the Occupiers’ Liability Act).  If I am able to do so without doing violence to the language used in Clause 6(b) of the Type 3 lease, I consider that I should construe the covenant in such a way as to avoid the latter situation.  
36.	I agree with the LVT’s decision (in their  paragraph 21) that there is no doctrine of inherent defect such as automatically to excuse the lessee under the Type 3 lease (or indeed under the other leases) from having to pay for the Appellant’s costs of remedying disrepair which had arisen because of inadequate original construction.  I also agree with the LVT’s decision (in their paragraph 23) that the fact that the only practical way of obtaining a properly repaired retaining wall was to build a retaining wall to proper modern specifications does not of itself mean that the works must be treated as an improvement (and therefore outside the Appellant’s obligation to carry out the works and outside the Respondents’ obligation to pay for them).  Further the LVT decided these points in favour of the Appellant and there is no appeal by the Respondents.  
37.	The question therefore arises as to whether the rebuilding of the whole of the retaining wall constitutes such extensive works that the Appellant on the proper construction of Clause 6(b) cannot be held liable to carry out such works (with the consequence that the lessees are not obliged to pay in respect of such works).  On this point I agree with Mr Heather that the relevant question to ask is not whether the works involve the rebuilding of the whole or substantially the whole of the retaining wall, but whether they involve the rebuilding of the whole or substantially the whole of the matters which the Appellant covenanted to repair under Clause 6(b).  The answer to this question is that the rebuilding of the retaining wall is merely renewal of a subsidiary part of the totality of what the Appellant covenanted to repair under Clause 6(b).  The Appellant was therefore obliged to put the retaining wall into a “properly repaired” condition by carrying out the works and the lessees under the Type 3 leases are obliged to pay their fair rateable proportion of the costs.  This approach of looking at the whole subject matter of the Appellant’s repairing covenant under Clause 6(b) is consistent with the approach approved in Lurcott v Wakely (see in particular per Buckley LJ at p.926).
38.	I also consider that the Appellant could not keep properly repaired the adjoining Amenity Area (which includes the Mauve Area which is retained by the retaining wall) or the pathway (which is protected by the retaining wall) unless the Appellant rebuilt the retaining wall.  No lesser works to the retaining wall than rebuilding can be identified which would have been sufficient to achieve this end, which is an end which the Appellant was obliged to achieve under Clause 6(b) because the Appellant was obliged to keep the adjoining Amenity Area and the pathway properly repaired.  The question of whether the retaining wall was or was not rebuilt impinged upon the condition of other parts of the estate which are the subject of the Appellant’s repairing covenant.  This confirms in my judgment the correctness of the conclusion that the proper exercise to undertake is not to look solely at the retaining wall and ask whether the Appellant has renewed the whole or substantially the whole of the retaining wall (which in fact has been done).  Instead the proper approach must be to look at the Appellant’s repairing obligation in clause 6(b) as a whole and ask whether the rebuilding of the retaining wall was so substantial a work that it could not properly be brought within the Appellant’s repairing obligations in that clause.  These repairing obligations require the Appellant to repair a subject matter which is far more extensive than merely the retaining wall and which is a subject matter which includes certain items (in particular the Mauve Area and the pathway) which require the existence of a proper retaining wall if they are to be kept in a properly repaired condition.  So viewed the rebuilding of the retaining wall constitutes merely the renewing of a subsidiary part of this subject matter and was therefore something which the Appellant was obliged to do under clause 6(b) and which therefore was something which could be charged to the lessees under the Type 3 leases through the service charge.
39.	There was no appeal against the LVT’s decision regarding the recoverability of costs through the service charge provisions in the leases.  Accordingly it is unnecessary for me to consider whether any order under section 20C of the Landlord and Tenant Act 1985 should be made.  So far as concerns the costs of the proceedings before the Lands Tribunal the Appellant, quite rightly, did not seek to make any application for costs against the Respondents.  
40.	In the result I allow the Appellant’s appeal to the extent that I find that the lessees under Type 3 leases are obliged to pay a fair and rateable proportion of the costs incurred by the Appellant in rebuilding the retaining wall.
Dated 11 September 2006

His Honour Judge Huskinson