The Court of Appeal gave judgment on 9 June 2026 in two appeals about when leaseholders can claim the right to manage part of a building, covering a Liverpool development and a London terrace.
Key facts
- Who: Leaseholders and their right to manage (RTM) companies, and landlords facing an RTM claim over part of a building.
- From: 9 June 2026 (judgment date)
- Source: The Courtyard RTM Company Ltd & Ors v Rockwell (FC103) Ltd & Anor [2026] EWCA Civ 712
In The Courtyard RTM Company Ltd & Ors v Rockwell (FC103) Ltd & Anor [2026] EWCA Civ 712, the Court of Appeal (Civil Division) dealt with two appeals about Chapter 1 of Part 2 of the Commonhold and Leasehold Reform Act 2002. Lord Justice Miles gave the judgment, sitting with Lord Justice Singh and Lord Justice Foxton, after a hearing on 29 and 30 April 2026. Both appeals came from a decision of the Upper Tribunal (Lands Chamber), [2025] UKUT 39 (LC).
Background
Chapter 1 gives leaseholders a statutory right to have a leaseholder-owned RTM company manage premises. In each case the question was whether the premises were a "self-contained part of a building" under section 72 of the 2002 Act.
Under section 72(3), a part of a building is self-contained if it constitutes a vertical division of the building, the structure of the building is such that it could be redeveloped independently of the rest of the building, and section 72(4) applies. Section 72(4) concerns whether the relevant services for occupiers of the part are provided independently of those for the rest of the building, or could be so provided without works likely to cause a significant interruption to services for the rest.
The first appeal concerned three blocks, The Courtyard, The Studios and The Terrace, in the Plaza Boulevard development in Liverpool. The First-tier Tribunal found that none was a self-contained part of a building. The Upper Tribunal upheld that result. It held that the blocks were not a vertical division of the wider estate because of a partly undivided basement car park beneath them. In places the area under each block was marked by solid walls or steel columns, but in some locations one could step or drive between the columns into the rest of the car park. The Upper Tribunal also considered that managing the car park in separate parts would be impractical. The RTM companies appealed.
The second appeal concerned 14 Park Crescent and 8 Park Crescent Mews East in London W1, part of a Regency terrace and its mews. The First-tier Tribunal found that the RTM company had established its claim, and the Upper Tribunal dismissed the landlords' appeal. The landlords appealed.
The issues
The RTM companies in the Liverpool appeal argued that section 72 is a complete, bespoke definition, that division can be shown by a notional line on a plan, and that splitting management of the car park is not impractical. They also argued that rights held by third parties over the premises are irrelevant.
The Upper Tribunal had also held that independent redevelopment does not require assuming complete demolition, nor that redevelopment must be possible without any neighbouring owner's consent or support.
What this means for leaseholders and landlords
The judgment concerns the meaning of "self-contained part of a building" in section 72 of the 2002 Act. The conditions are vertical division, independent redevelopment and independent services, and the appeals show that disputes over them can turn on the physical features of a building, such as a shared basement car park or party walls in a terrace.
Sources
- The Courtyard RTM Company Ltd & Ors v Rockwell (FC103) Ltd & Anor [2026] EWCA Civ 712, Court of Appeal (Civil Division), 9 June 2026