Balconies – Overhang Hangovers

Balconies and service charges frequently present challenges. While leases tend to clearly define the boundaries and responsibilities for internal areas, ambiguity often arises regarding balconies.

This issue was recently considered by the Upper Tribunal in the case of Holy v Brentford Lock Island Residents’ Association Limited, which provides valuable insight into disrepair principles and highlights important considerations for property management when an appeal is ongoing.

Background to the case

The case involved a residential development where the balconies featured timber decking. Although the decking was not deemed deficient in respect of Building Safety Act (BSA) requirements, it was in poor condition for a minority of properties. There were concerns about combustibility and mortgageability, despite the decking not being statutorily defective. The management company (ManCo) sought a prospective declaration under section 27A of the Landlord and Tenant Act 1985 that the costs of replacing all balcony floors would be reasonable and recoverable via the service charge. The First-tier Tribunal (FTT) decided the costs were recoverable, but a leaseholder who had independently replaced her own decking appealed the decision to the Upper Tribunal (UT). While the appeal was pending, ManCo arranged spot repairs for balconies in substantially poor condition.

Responsibility for repairs

The first question for the Tribunal was determining responsibility. The leases demised only the “floor surface” of the balconies to the tenants, requiring the UT to establish whether this included the decking. The Tribunal concluded that it did not, interpreting “floor surface” as only “the uppermost two dimensional face having length and breadth but no depth.” As a result, the responsibility for repairing the decking rested with the landlord.

Reasonableness of replacement

The second, and more complex question was whether ManCo was justified in replacing all the timber decking with aluminium. The UT applied a five-stage test, examining:

1. The subject of the covenant;
2. The existence of damage or deterioration;
3. Whether these issues reduced the subject below the required standard of repair;
4. The work necessary to restore the subject to a state of repair;
5. Whether the nature of the work meant the parties could not have intended it to fall upon the covenanting party.

Tribunal findings

The UT determined that as at the date of the FTT decision it was reasonable to replace all the balconies. Urgent repairs were needed for approximately 15% of them, and most others were nearing the end of their expected lifespan. The potential for aluminium replacements to resolve fire risk concerns further justified the decision. The UT confirmed that a landlord or ManCo may have several reasonable options, and what is reasonable will depend on the specific facts of the case. Properly evidenced concerns about mortgageability may also justify wholesale replacement.

Changing circumstances and appeal outcome

BUT circumstances had changed because of the spot repairs. There was no longer an urgent need for work, shifting the balance of factors. The UT lacked information about the current number of balconies requiring repair, or whether full replacement was still justified. Despite this uncertainty, it was not enough to overturn the FTT’s decision and the appeal was dismissed.

Implications for property management during litigation

This case raises the question of whether, had the appellant provided conclusive evidence, ManCo’s proactive management could have undermined its own case. The tone of the judgment suggests this possibility. Therefore, parties should always consider how any works carried out during litigation may affect the merits of the case, especially given the potentially lengthy duration of such proceedings.

Further considerations

The UT briefly contemplated whether ManCo might still be entitled to replace the decking even if none of the balconies were in disrepair, on the basis that the covenant required keeping them “in good condition,” and that the works would be covered by tenants’ obligation to pay for “rectifying inherent structural defects.” However, as these points were not argued in detail, no decision was made, leaving them for future cases or appeals.