A1 Properties (Sunderland) Ltd v Tudor Studios RTM Company Ltd

Factual and Procedural Background

The case concerns purpose–built student accommodation at [Number] Tudor Road, The City. The Freehold is owned by Company B, while an intermediate landlord (“Appellant”) holds four 999-year leases of the communal areas and sub-lets them to Company C. Individual investor tenants hold 250-year leases of 237 studio flats and three larger flats, letting them directly to students.

A Right to Manage (“RTM”) company (“Respondent”) was created by qualifying tenants under the Commonhold and Leasehold Reform Act 2002 (“CLRA”). On about 23 March 2020 Respondent served a statutory “claim notice” on Company B and Company C but did not serve the Appellant, even though section 79(6)(a) required service on every landlord under a lease of any part of the premises.

Company C issued a counter-notice under section 84(1) demanding proof that Appellant had been served. Respondent then sought a determination from the First-tier Tribunal (“FTT”) that it was entitled to acquire the right to manage. The FTT (June 2022) held the omission did not invalidate the claim, relying on the Court of Appeal decision in Elim Court. The Upper Tribunal (January 2023) upheld that decision but granted a “leap-frog” certificate so that Appellant could challenge Elim Court directly before the Supreme Court (“the Court”). The Association of Leasehold Enfranchisement Practitioners Ltd (“Company A”) intervened.

Legal Issues Presented

1. Whether failure to serve a claim notice on any landlord required by section 79(6)(a) of the CLRA necessarily invalidates the acquisition of the right to manage.
2. If the answer is “no,” whether the specific failure to serve the Appellant in this case nonetheless invalidated Respondent’s claim.

Arguments of the Parties

Appellant's Arguments

• Invalidity is automatic: Section 79(6)(a) creates a strict, bright-line rule; non-compliance voids the entire process.
• Easy to restart: Because a RTM company may simply serve a new notice, Parliament must have intended strict compliance.
• Statutory indications: Express “savings” clauses elsewhere (e.g., sections 78(7), 81(1)) imply that where no saving is provided, non-compliance is fatal.
• Distinguishing Elim Court: In that case an attempt at service was made (albeit to the wrong address); here no attempt was made.

Respondent's Arguments

• Purpose-based construction: Following R v Soneji, the question is whether Parliament intended invalidity; focusing on consequences and prejudice.
• No prejudice: Appellant had no management functions, was later joined to the proceedings, and could raise any objection.
• Statutory scheme balances interests: Sections 79(7) and 85 show Parliament anticipated situations where some landlords are not served.
• Elim Court correct: Failure to serve a landlord with no management role renders the process voidable, not void, and becomes harmless once the tribunal determines entitlement.

Table of Precedents Cited

Court's Reasoning and Analysis

Applying Soneji, the Court asked whether Parliament intended total invalidity when a claim notice is not served on a landlord who could have been found. The statutory structure shows two distinct mechanisms:

• If no relevant landlords can be found, section 85 allows the tribunal to validate the claim without service.
• If some landlords are not served because they are genuinely untraceable (section 79(7)), the process may still proceed.

Consequently, Parliament clearly differentiated between (i) invisible landlords and (ii) visible but unserved landlords. For visible landlords, failure to serve should not automatically void the process but should render it voidable at that landlord’s instance.

In this case:

1. Appellant was not “invisible”; it was readily identifiable; hence section 79(7) did not dispense with service.
2. However, the tribunal was seized of the dispute because Company C filed a counter-notice. Appellant was later joined and could present every objection it might have raised had it been served.
3. The tribunal determined that statutory conditions for RTM were met. Appellant therefore suffered no substantive prejudice: its potential objections were heard and rejected.

Balancing the CLRA’s twin aims—empowering leaseholders and preventing obstructive tactics—the Court concluded that non-service on a landlord with no additional substantive objections should not defeat an otherwise valid RTM acquisition. The right to manage therefore becomes voidable, but only until the tribunal confirms entitlement; once confirmed, the defect is cured.

Holding and Implications

APPEAL DISMISSED.

The Supreme Court held that omission to serve a claim notice on a landlord who could have been found renders the RTM process voidable, not automatically void. Because the tribunal had already determined entitlement and Appellant had an opportunity to participate, the acquisition of the right to manage stands.

Implications are largely confined to procedural practice: RTM companies remain obliged to serve all landlords, but an inadvertent failure will not defeat the claim if (a) no substantive objection was thereby lost or (b) the tribunal ultimately confirms entitlement. The decision leaves Elim Court’s result intact while refining its reasoning, and does not create new substantive property law precedents.