When Michael Stainer “illegally” removed Henry Bolton in November 2018, as the new director of his various companies, and replaced him with “Robert Moss’, little did he know what problems he was storing up for himself, both personally and business-wise.
Stainer’s problem was that as a bankrupt, it was illegal for him to be a director and act as if he were a director, so what he needed was a compliant “puppet”. But as connoisseurs of the black art of puppetry know, beware of puppets who acquire a voice of their own!
So what was Michael Stainer thinking on May 5th 2019, when Mr Moss (pictured below) was the star witness in a successful case brought by the Tribunal-appointed manager of the Grand, Alison Mooney. Her intention was to seek permission from the Property Tribunal to bring about an end to the holiday lets, guided tours and other activities that make life a misery for many residents in a building described by the presiding Judge Mark Loveday, as a scene of “warfare”.
The case itself was in reality small beer compared with earlier hearings which the Tribunal neatly summarised, with a sense perhaps of “here we go again!”, especially as two of the panel of three judges had been involved in previous cases:
“The premises have a long and sorry history of disputes. Apart from several sets of leasehold management proceedings in this Tribunal, we were referred to the appointment of a receiver as long ago as the 1980s, two appeals in the Lands Chamber of the Upper Tribunal (LRX/137/2019 and LRX/109/2018), a judicial review application in the High Court (CO/1298/2019), a County Court injunctions, criminal proceedings in the Crown Court at Canterbury, various insolvency cases and at least one defamation claim. Alongside this matter, the Tribunal has been case managing an application to discharge the manager (CHI/29UL/LVM/2020/0001), which is due for hearing in June/July 2020.“
What it did do was to rip away the veil that concealed who was really in charge. As has been written previously, Stainer has remained in control of the Grand since the 1980s through personal insolvency, repossession, fire, dodgy deals with creditors and much more. In this case, the panel of Judges exposed the reality, and their chief help in achieving this was……. Robert Moss, aided and abetted by Michael Stainer (pictured) himself.
As a result, Ms Mooney can now bring to an end a holiday-let business that saw 18 flats out of the 65 in the Grand use for short-term lets, advertised on various booking sites for rates between £105 and £195 per day.
These flats raked in anything from £250,00 to £350,000 per annum, yet never managed to pay a penny-piece towards the maintenance of the Grand – or much else it would appear*. This debt stood at £328,701.37 as of May 5th this year. – £268,252 of it by Mrs Stainer!
All of these examples of Grand décor were noted by an earlier Tribunal in January 2018, two of whose members were also sitting this May. A final nuisance that will end is the use of residential entrances for the noisy crack-of-dawn arrival of exhibitors for antiques fairs. These will now be routed through the long-established ballroom foyer entrance, which ironically runs under the Stainers’ private flat – now subject to a possession order in the High Court.**
So, what of the hearing, and what really did the Moss/Stainer show reveal. It was all really quite simple. The case for Ms Mooney and the supporting residents’ association was that the leases forbade short term lets, the commercial usage of flats by, for example, a local school for clairvoyants and anything that constituted a nuisance and was a violation of their right to the peaceful enjoyment of their homes. The case for Hallam/Moss/Stainer and their supporters was that the Landlord had the right to grant permissions and licences for this usage and that these had been granted years ago and were still in force.
Due to technology issues with the various opponents of the application who were clearly sharing one room in a fine approximation of non-social distancing, the Tribunal turned first of all to Mr Moss, leaving Mr Stainer mouthing silently at his laptop.
So, when Moss was asked the very sensible preliminary question as to what steps he had taken against the Stainers to recover service charges, he replied he had: “no comment on that”. It was put to him that Hallam had taken no action, and he again replied he had “no comment”. When asked what had happened to copies of permissions and consents granted by Hallam, Mr Moss accepted written consents had been granted but stated he “had no access to these documents”. He had not asked for the documents and admitted “it was of no consequence” to him. He insisted that as a director he would “still have my say and stay my ground”. Management of the premises had been “running beautifully” for 25 years and “it’s just fine”. After 25 years, “I don’t know why someone has to come in and disrupt it … and I am not having someone disrupting the commercial side of it.”
The Tribunal itself referred Mr Moss to his obligation to co-operate with the management order, and asked whether he considered that withholding written copies of consents from the Tribunal-appointed Manager was giving “all reasonable assistance” with the management of the property. He confirmed he had not co-operated because he had his “own commercial considerations”. Mr Moss was also asked how (if he had only been a director for 1.5 years), he was able to give evidence about events over the “almost four years [Mr Cobrin] has been at The Grand” or about events in February 2016.” He said he was unsure where he had got the information from in his statement, but accepted it was hearsay.
When reviewing this and other evidence, the Tribunal in its determination stated that “in general, the Tribunal accepts the witnesses who gave evidence orally did so carefully and that they were trying their best to tell the truth.”
“The main exception to this was Mr Moss, who the Tribunal did not find a particularly satisfactory witness. It was obvious from the face of his written statement that Mr Moss did not prepare the bulk of it himself (despite the statement of truth). Almost half the statement related to events which pre-dated his involvement in The Grand. Despite this, he was reluctant to admit the obvious inference that his statement was a collaborative effort with Mr Stainer – even though Mr Stainer himself volunteered the fact without any prompting at the very start of his own evidence. Worse still, Mr Moss’s answers to questions about co-operating with the Manager were evasive and failed to recognise the clear requirements of the management order (to which a penal notice was attached).”
Finally, “as to Mr Stainer, his evidence largely relied on Mr Moss’s statement. Although he gave evidence more confidently, his case generally suffered from the fact he adopted a statement by a witness who the Tribunal considers to be unreliable.”
A crucial consideration that the Tribunal took into account, aside from the weight of evidence presented as to nuisance and disturbance, was:
“..the conduct of the First and Second Respondents [Hallam Estates and Mr Stainer] One cannot avoid the fact that successive tribunals have made adverse findings about their conduct over the years. Indeed, some additional findings are made above in relation to the First Respondent. [Mr Moss specifically]. The Tribunal does not find the evidence of service charge arrears (and lack of enforcement of the charging covenants) and the repeated reference to other proceedings to be of direct relevance to this application, although [it] provides a useful backdrop. But it is certainly relevant that the First Respondent’s director does not recognise any obligation to provide copies of consents to the Manager.”
The implications of all this are highly significant. The holiday flats are already closed for bookings because of the lockdown. Repossession proceedings and forced sales of flats are already underway with two flats going into auction at the end of July.
Ms Mooney, subject to possible appeals, now has the right to bring the holiday lets to an end.
All of this begs one huge question. If, like everyone else, the Stainers had diligently paid their service charges every year, a figure of around £34,000 per annum out of total revenues of around £340,000 – would they have ended up losing everything?
*We understand that bailiffs turned up last Thursday on behalf of a utility company to collect an unpaid £8000 bill and we have already reported on unpaid local suppliers
** The High Court Chancery reference on this is CH/2020/000059
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