Unintended consequences

It isn’t only big policy decisions that have unintended consequences; Rawdon Crozier explains how a well-intentioned and principled change in public policy killed the Lease Conference


While there are those who might argue the intended consequences of Brexit were never really thought through, it probably came as a surprise to the most painstaking and considered Leave voter to find that the Brexit vote could also affect the UK’s participation in Euratom, the European Atomic Energy Community. There are another 40 or so other trans-European agencies, membership of many of which, such as the European Aviation Safety Agency and European Maritime Safety Agency, could only be considered as entirely benign and even advantageous by the most ardent Brexiteer, that could be similarly affected.

Decisions taken by the application of broad principle are apt to have unintended consequences when it comes to considering the detail of their impact.

The Lease Conference is another example of unintended consequences, albeit on a much smaller scale. Why is it important at all? The first Lease Conference (or ‘LEASE Conference’, if one follows the branding) had been organised by the Leasehold Advisory Service (or ‘Lease’) since 2003 and, ten years later, it had become established enough to describe itself in the 2013 Conference Brochure as the ‘the pre-eminent full day conference in the leasehold calendar, attracting… delegates from both the private and public sectors… lawyers, surveyors, property managers, estate agents, housing officers, lenders and leaseholders’ and it was that mix which gave it quite a special character. The 2017 Conference helps illustrate that mix: the Keynote Address was delivered by the outgoing President of the Supreme Court, Lord Neuberger, while other speakers included two MPs, Gavin Barwell, the Housing Minister, and Sir Peter Bottomley MP, as well as Siobhan McGrath, the President of the FTT Property Chamber, Paula Higgins, the Chief Executive of the Homeowner’s Alliance, and Nigel Glen, the Chief Executive of ARMA.

Lord Neuberger was every bit as impressive as one expected him to be; both on landlord and tenant law and, when he threw himself open to questions, on the Supreme Court’s then-recent Brexit judgment in Miller. In the afternoon, Sir Peter Bottomley delivered a beast of a speech; he may once have been cartooned as a schoolboy in his Ministerial days, but on the back benches, he has grown in stature, both literally and metaphorically, and is the formidable patron of the Leasehold Knowledge Partnership (LKP), an organisation that, for the general reader, could perhaps best be described as the ‘Stonewall’ of leaseholders’ rights. Sir Peter may not have elicited gasps of outrage as the LKP website later suggested, but there were audible mutters of ‘cab-rank rule’ when he questioned how Justin Bates, who was speaking at a break-out session on service charges later in the day, could sleep at night after representing landlords. In the subsequent service charge session Justin Bates managed to confine himself to only three mentions of his pro bono awards.

The speaker of the day turned out to be Gavin Barwell, the fifth Housing Minister since 2010 and the 14th since 1997, and further disadvantaged by an appearance which could equally have seen him cartooned as a be-capped schoolboy, who spoke with a degree of authority that suggested a genuine interest in his ministerial remit. His topic was ‘50 Years since the Leasehold Reform Act - how far have we come? What does the next 50 years look like?’ He was realistic about past failings and appeared committed to seeing the rights of leaseholders better protected and effective alternatives to leasehold ownership being introduced. Moreover, he was able to finish by pulling a rabbit out of the hat: Lease, he announced, was henceforward to be fully funded by the government to enable it to focus on serving the needs of leaseholders. It was an impressive performance topped with an impressive final flourish and it finished to warm applause.

On a very unscientific survey, well under a half of those present realised he had also just announced the end of the Lease Conference and it may well have been that, even for the Minister it was an unintended consequence.

A little time ago ministers faced with tight ministerial budgets had urged autonomous quasi-governmental organisations within their purview to start trying to raise some of their own funding. Lease, with a wealth of knowledge and experience of landlord and tenant law was, perhaps, particularly well-placed to do so because it also had access to a ready pool of property professionals – property manages and solicitors – willing to pay for training courses, seminars, webinars and specialist advice. There were even plans to start providing property professionals with paid-for telephone advice and the 2016 Lease Conference had ended with an equal flourish when Tony Essien, Lease’s Chief Executive, had announced that by 2020 Lease was aiming to generate an annual income of £1m a year and become self-funding.

This move had not been welcome in all quarters and there were those, prominent among them the LKP, which described the announcement as ‘the polar opposite of what LKP has been urging for years’*, who passionately argued that, as a matter of principle, providing paid advice to landlords and their agents would divert Lease from its real task of providing free advice to leaseholders or, worse still, that it would leave Lease open to commercial pressures that could compromise its ability single-mindedly to protect the interests of leaseholders.

The announcement of Lease’s intention to become self-funding had galvanised this lobby and the growing awareness of, among other things, the ground rent scandal – with developers, such as Taylor Wimpey, mis-selling leaseholds with ratcheting ground rent increases** – gave it additional ammunition over the course of 2016.

The Minister’s conference announcement in 2017 was thus the signal that the campaign to bring all of Lease’s commercial activities to an end had succeeded. The problem was that the LEASE Conference was itself one of those commercial activities.

While the unintended consequences of Brexit are likely to take some time to be fully appreciated, the immediate effect of the LEASE Conference’s demise is likely to prove less dramatic; the Professionalism in Property Conference 2018, promoted by Lease’s commercial partner from 2017 takes place on 9 May 2018 with the keynote address being given by the Chancellor of the High Court, Sir Geoffrey Vos, and the Law Commissioner with responsibility for landlord & tenant law, Professor Nick Hopkins, giving the main speech in the afternoon. With leasehold reform very much on the legislative agenda, another speaker will be Jim Fitzpatrick MP,

Co-Chair All Party Parliamentary Group on Leasehold Reform, in addition the conference promises a similar mix of lawyers, property professionals and representatives of freeholder and leaseholder interests as the Lease Conferences did but the announcement of another dramatic change in government policy seems less likely.

There is, of course, another article to be written about well-intentioned housing policy and unintended consequences but the key facts behind the story of how the desire to improve the thermal efficiency of council-owned tower blocks led to the Grenfell Tower tragedy still wait to be established. For the moment let me revert to the intended consequence of the government’s change in policy, the cessation of Lease’s commercial activities, it happened that I ended up taking part in Lease’s last training day in September last year conducting a seminar for what turned out to be a few solicitors and a rather larger number of, mostly local authority, property managers and while I appreciate the concerns of the LKP and others, there is something – and I accept this is an entirely personal opinion – to be said for the soft art of education, although my seminar was entitled ‘Fighting Fit for the First Tier Tribunal’ (I didn’t choose the title), the first message I delivered (and this was also taken from my brief from Lease) was that the best way of preparing for the FTT was to manage properties properly, to understand the terms of the leases and the procedural requirements of the Landlord & Tenant Act 1985 and other legislation and thereby, to do everything possible to avoid ending up in the Tribunal in the first place. The Conference may have been saved but I can’t help wondering if something valuable may have been lost.

Contributor Rawdon Crozier (Rawdon was the keynote speaker at the 2016 Lease Conference and will be a speaker at the Professionalism in Property Conference 2018 on 9 May 2018)

* https://www.leaseholdknowledge.com/lease-annual-conference-2016 

**see eg https://www.theguardian.com/business/2017/apr/27/taylor-wimpey-ground-rent-scandal

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Rawdon Crozier

Rawdon Crozier is a barrister at KBG Chambers, Plymouth, specialising in property law. He is a member of the Counsel editorial board, writes for several legal journals and also writes poetry. In 2015 he went straight from Arnold v Britton [2015] UKSC 36 in the Supreme Court to starting chemotherapy and ‘got the right result in the latter’.