Much vaunted by some as being the great white hope of leaseholders everywhere the much awaited decision of the Court of Appeal was handed down last week.
For those in the know the outcome was not a surprise. The Court upheld the decision of the Upper Tribunal rejecting the Parthenia Model and declined to grant leave to appeal.
What does this mean in practical terms? Effectively, ‘we are where we were’ so to speak, in other words, graphs are not the only way of determining relativity and in fact, comparable evidence, including where appropriate an adjusted treatment of the subject flat is to be preferred.
The Savills 2015 enfranchiseable graph is reliable – and a good place to start to them make a ‘no act’ adjustment.
The decision was also helpful in that it clarified the extent of the no-act assumptions. The court of Appeal clarified that we are talking about a no act environment in the building and in reference to the flat in question, but the wider world can be one in which the Act applies.
The decision will be disappointing to those who hoped for a big shift in relativity upwards (which would favour tenants) but the Court was careful to speak twice of the hunt for the ‘holy grail’ of relativity- a simple prescriptive method and it mentioned the inconsistent outcome of the 2009 RICS study on this and also noted that parliament had recommended referring the question of how to make the calculation of the price payable on enfranchisement simpler and ‘fairer’ to the Law Commission.
It is in this perhaps that the greater hope of leaseholders will lie.
No-one could expect the discussion of the outcome of this case to be seen in a vacuum given all of the other things going on in leasehold at the moment – not least Justin Madders MP’s private members’ bill and also the outcomes of the consultation and the proposed reforms to ground rents.
What is certain is that there are now some very interesting times ahead for leasehold this year so, as ever, watch this space.
Mark Chick