The Court of Appeal has dismissed a legal challenge that campaigners hoped would lead to a reduction in the cost of extending leases.

Background

The landmark 2016 case, Adrian Howard Mundy v The Trustees of The Sloane Stanley Estate, involved a flat in Chelsea with 23 years left to run on the lease.

 

The decision of the Upper Tribunal (Lands Chamber), was to reject the Parthenia model of relativity in valuing new lease claims under the Leasehold Reform, Housing and Urban Development Act 1993.  Parthenia had controversially claimed that a computer model using hedonic regression was the only reliable way of measuring relativity, and that all other methods in current use were flawed. The Court instead upheld the widely used ‘Gerald Eve’ model that was created by surveyors more than 20 years ago.

 

The Appeal

Rejecting the challenge, Lord Justice Lewison said the Upper Tribunal was ‘well within the scope of its functions’ to rule out future use of the Parthenia model. Lewison noted that the Law Commission is considering how valuations can be simplified under the Leasehold Reform, Housing and Urban Development Act 1993. ‘It may be, therefore, that the holy grail will one day be found,’ he said. Enfranchisement is one of the three priority areas that will kick off the commission’s two-and-a-half-year residential leasehold project.

 

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