Upper Tribunal allows appeal against deposit payment order after landlord argued he was not aware of proceedings

Upper Tribunal allows appeal against deposit payment order after landlord argued he was not aware of proceedings

An appeal by a landlord against a payment order for £6,000 under the Tenancy Deposit Schemes (Scotland) Regulations 2011 has been allowed by the Upper Tribunal for Scotland after he successfully argued that he ought to have been given an opportunity to make representations.

Appellant Shoukat Khan argued that he had been unaware of the First-tier Tribunal procedure against him until sheriff officers attended his property in 2022. The respondent, Addington Formwork Ltd, made no representations to the Upper Tribunal but did not indicate that they consented to the grant of the appeal.

The appeal was heard by Sheriff Iain Fleming of the Upper Tribunal, which dealt with the appeal by way of written submissions alone.

Interests of justice

The appellant was the landlord of a property at Naburn Gate, Glasgow, which was managed on his behalf by a letting agency, City Centre Lets Ltd, which was also a named respondent in the original action. Following a case management discussion at which neither the landlord nor a representative of the agency was represented, the FtT issued its decision to them on 11 November 2021 by recorded delivery.

After the delivery was signed for and then returned, the respondent instructed sheriff officers to seek recovery of the sums due. It was the appellant’s position that he only became aware of the previous proceedings when he was served a charge by sheriff officers on 25 January 2022. He made an application for recall of the decision, which was refused by the FtT on the grounds that he had failed to provide specification in relation to the chronology of matters and shown no cause which would justify an extension to the time period in which to make an application for recall.

It was explained by the appellant that he had been outwith the UK in the time following the FtT’s original decision. He argued that it was in the interests of justice to extend the time limit for lodging an application as he had not had an opportunity to make submissions before the FtT. Furthermore, the lease which was the subject of the decision did not make reference to him and was of questionable legality.

In support of the appeal, it was also submitted that service of the original application ought to have been made on the appellant personally in the absence of any legal basis for the FtT to reach the conclusion that City Centre Lets Ltd was entitled to accept service on his behalf. An error of law had therefore occurred as the FtT had proceeded on the basis that CCLL was his agent.

No evidential basis

In his decision, Sheriff Fleming observed: “The appellant argues that in not properly serving the proceedings upon the appellant and thereafter finding that CCLL was the appellant’s undisclosed principal where there was no evidence to that effect, or if there was such evidence failing to set out what it was, the FtT erred in law. The Upper Tribunal sustains that submission. The FtT has made a finding without any evidential basis to do so. Without such an evidential basis the FtT erred in law.”

He continued: “The fact that the appellant is the registered proprietor is in and of itself not sufficient to entitle the FtT to proceed as it did. Firstly, there is no evidence of the relevant date of the information from the Land Register for Scotland. Secondly, even if were the case that the information is both timeous and accurate, there was no evidential basis to allow the FtT to conclude that CCLL had authority to act on behalf of and legally bind the appellant. This is particularly the case given that the appellant’s name does not feature on the lease which was agreed between the parties.”

On the significance of the appellant’s non-participation in the original CMD, the sheriff concluded: “The position which the Upper Tribunal faces is that a party who had not been served with the documentation has a finding made against him in the sum of £6000. No opportunity has been afforded to the appellant to appear before the FtT. In the apparent absence of evidence the FtT then proceeded to hold that CCLL had legal authority to act on behalf of and legally bind the appellant. It is clear that an error of law has taken place and the appeal must succeed.”

The decision of the FtT was therefore quashed and the matter remitted to a freshly constituted FtT for consideration.

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