Allegations of breaches of human rights at the Grand? Sounds absurd but that is exactly what Michael Stainer’s solicitor Andrew Duncan(pictured left), and his latest Queen’s Counsel, Kerry Bretherton QC (pictured right) claimed in an attempt by the Grand’s freeholder, Hallam Estates Ltd, to overturn the July 5th decision of the First Tier Property Tribunal.
It was this decision that saw the Tribunal decide in favour of an application by residents that would place the management of the residential part of the Grand firmly in the hands of the new Manager and increase Hallam Estates contribution to the maintenance of the fabric of Grand from under 3% to 25%.
Hallam Estates and the Stainers (pictured) claimed that in refusing to delay the hearing that took place in April, the Tribunal denied Hallam Estate’s right to a fair trial under Article 6 of the European Convention of Human Rights. The demand for adjournment had been based on the medical side-effects of the alleged assault on Mr Stainer on January 26th for which no one has been arrested. The claim was that:
“The Tribunal failed to deal with the case fairly and justly and breached the principles of natural justice in refusing to adjourn the trial. The decision to adjourn, as recorded in the judgment, failed to take into account relevant matters and took into account irrelevant matters. The decision was procedurally unfair and wrong in law…”
The Tribunal made very short shrift of this claim, much of which hinged on the medical evidence provided to support the claim of medical incapacity – or rather not provided. Notably absent had been the hospital reports following the attack. As the Tribunal stated:
“Counsel criticises the Tribunal for not forming a view on the medical condition of Mr Stainer and Mrs Stainer, and their ability to participate in the proceedings. The Tribunal could not do that without proper scrutiny because the other party AORG strongly contested the factual basis of the applications for adjournment.”
In fact, as we’ve written before, repeated requests by AORG for medical evidence stronger than a certificate of unfitness to work went unanswered.
The second grounds for dismissal were even simpler – in effect the absence of Hallam Estates Ltd, who failed to provide a submission to the Tribunal prior to the hearing as per the directions issued to all participants in the case, and failed to participate in the hearing itself. In regard to the role of Andrew Duncan in particlar, the Tribunal states:
“Mr Duncan was explicit that he did not represent Hallam Estates when he made the applications to adjourn the hearings on behalf of Mr Stainer……..The Tribunal did not refuse Hallam Estates an adjournment because no application for adjournment was made on behalf of Hallam Estates”.
Attempts to additionally suggest that Hallam Estates were not correctly served with papers were dismissed:
“The Tribunal in respect of Hallam Estates satisfied itself that it had been served with the relevant papers including the hearing date and that Hallam Estates had given no explanation for its nonattendance. Counsel accepts that Hallam Estates were served with the papers. Counsel then at criticises the Tribunal for not making assumptions about why Hallam Estates had not engaged. The Tribunal is at a loss to comprehend how it can make assumptions in the absence of any information forthcoming from the party concerned.”
The Tribunal went on to repeat its earlier criticisms of Andrew Duncan’s conduct:
“The applications [for an adjournment] made by Mr Duncan on behalf of Mrs Stainer were not transparent and designed to frustrate proper scrutiny of their merits………..the interests of the Applicants for proceeding were compelling and outweighed any prejudice to Mr and Mrs Stainer by not presenting their cases in person”.
Throughout the last year of litigation, the blurring of the roles of Hallam Estates as freeholder, the Stainers as directors of the freeholder and the Stainers as leaseholders of 19 flats has been used to seek to muddy the waters of the various cases. The Tribunal clearly considered it important not to confuse the interests of Mr and Mrs Stainer as leaseholders with the freehold interest held by Hallam Estates and firmly refuted the idea that Mr Stainer was the only person who could speak for the commercial interests.
The Tribunal pointed out that Mr Stainer chose not to take part in the previous service charge proceedings, allowing Mrs Stainer and Robert Richardson to give evidence, the latter exclusively in regard to the commercial interests. Subsequently, Mr and Mrs Stainer were fully engaged in the proceedings for the application for variation of the management order until at least 8 March 2018 when they submitted written statements. AORG and Mr Hammond served their full case on 16 March 2018 personally on Mr. Stainer in his dual capacity as director of Hallam Estates and as a leaseholder. Mr Duncan was clearly preparing for trial and had instructions on the effect of the proposed order on the commercial enterprises. The Tribunal pointed out that both Hallam Estates and Mr Stainer are experienced in matters of litigation and Court and Tribunal procedures and that therefore:
“Given the above facts, the Tribunal considers that Hallam Estates has no reasonable explanation for its failure to engage with the proceedings.”
It was therefore no surprise to see the Tribunal state that:
“…there has been no procedural unfairness in respect of the making of the management order. Counsel’s case for procedural unfairness …….. is based on an error of law.”
The concluding part of the decision is particularly scathing. The Tribunal states that:
“The purposes of the Revised order are to put right the historic disrepair of the property, to ensure that the necessary funds for those works are collected and to preserve the current rights of leaseholders to peaceably enjoy their demises Those aims should be of benefit to Mr and Mrs Stainer in their capacity as leaseholders.”
However, there is a sting in the tail:
“The principal parts of the Order which may adversely affect Mr and Mrs Stainer as leaseholders are the power of the Manager to take proceedings for breach of covenant other than money.”
This refers to the use of the Stainers’ 19 flats as holiday lets which it is claimed are in breach of the leases of each and every flat. The Tribunal did not give the Manager unlimited discretion in this area but invited the Manager to seek the direction of the Tribunal before taking legal proceedings for breach of covenant.
In conclusion, the Tribunal reiterated that:
“Hallam Estates chose not to participate in the proceedings, and has given no reasonable explanation for its failure to engage with the proceedings.”
Finally, the Tribunal reminds us that in January 2018 it found that Hallam Estate’s employees, and in particular Michael Stainer and Robert Richardson (pictured), had deliberately obstructed the previous Manager, Mr David Hammond in the exercise of his management functions. Therefore, the Tribunal would refuse to stay the new management order beyond 21 days, which whilst not preventing Hallam Estates from appealing:
“……. stops the use of legal processes to frustrate the Manager in the performance of her legitimate role.”
While all this is going on, Michael Stainer’s tax affairs go from bad to worse, attracting the attention of AccountingWEB, which is the largest independent online community for accounting and finance professionals in the UK:
And let’s not forget the tightening web of personal and corporate insolvency. Kentish Estates Ltd, which Michael Stainer set up in 1994, has been wound up:
And this, the Grand Folkestone, which was the partnership of Michael and Doris Stainer personally:
So as we enjoy the Grand’s Oldtimer’s Car Rally on Bank Holiday Monday, spare a thought for another oldtimer for who time is being called! September is going to be a very busy month in the Insolvency Courts.
The Shepwayvox Team – Dissent is NOT a Crime