The Upper Tribunal has considered whether a tenancy agreement allowed a social landlord to charge for additional services. John Murray reports on the outcome.
Sometimes tenants are required to pay a service charge to cover the cost of services and maintenance of their home and the surrounding area.
The obligation on the landlord to provide a continued service in respect of the property is commonly found in the tenancy agreement with a reciprocal obligation on the tenant to pay for the service provided. However, there can be a great discrepancy between the service provided and the charge payable. The appeal case of Curo Places Limited v Anthony Pimlett  UKUT 130 (LC) focused on whether or not a clause in a tenancy agreement could allow the landlord to add additional services and charge for them.
The tenant, Mr Pimlett had resided in a self-contained bungalow for older people since 2008. At that time, the tenancy was entered into with Somer Housing Trust. Following the merger of three housing associations including Somer Housing, Curo Places became the landlord of the bungalow. The original tenancy agreement with Somer Housing had set out specific services which would be provided in return for a service charge being payable. Though not set out in the tenancy agreement, grounds maintenance was provided by the landlord with no obligation being placed on the tenant to pay for such service.
The appellant housing association, Curo saw this service being provided for no extra costs as a problem and subsequently amended the wording in their tenancy agreements for future tenants, making ground maintenance a chargeable service. A couple of years later, Curo proposed to vary all tenancy agreements to include ground maintenance as an additional chargeable service. The clause in question stated, “the Trust agrees to provide the services (if any)…for which you pay a service charge providing that, subject to consultation with the tenant it may provide extra services if it believes this would be useful”.
Curo’s stance was that Mr P was now liable to pay for the ground maintenance he had received free of charge. Mr P subsequently challenged whether an additional charge was payable in the First Tier Tribunal. The FTT found that Curo were not entitled to recover this charge as the wording of the new clause provided for ‘extra’ services and Mr P had already been receiving the ground maintenance service at no additional cost. The service was therefore not deemed to be an addition.
Curo subsequently appealed to the Upper Tribunal arguing that the interpretation of the clause within the tenancy agreement was such that it “dealt with services for which there are specific charges and therefore should not prevent the charging services in respect of which there are no specific charges”. The Upper Tribunal did not find merit in this argument and followed the reasoning of the FTT.
The construction of the clause and meaning of the word ‘extra’ is reasonably understood to mean additional provisions being provided by the appellant. Though Mr P was not paying for the ground maintenance service, he was already receiving the service as at the date of the grant of the tenancy agreement, and would receive no additional service. Whilst it is understood that the service would be useful to a tenant not already receiving it, to those like Mr P who were reliant on this service, they would now face a financial burden.
It is important to note that the UTT were not expressly asked to consider whether the clause contravened the Unfair Terms in Consumer Contracts Regulations 1999. Neither party put forward this argument. Nor did the UTT deem it necessary to make further analysis of the clauses interpretation under the 1999 Regulation. Yet it is clear from this judgment the court will not take kindly to landlords unilaterally change the terms of the tenancy agreement to financial burden its tenants.