Select Committee of Tynwald on Service Charges and ...

PP 48/11

SELECT COMMITTEE OF TYNWALD

ON SERVICE CHARGES AND

FREEHOLD PROPERTY (PETITION

FOR REDRESS OF GRIEVANCE)

2010-2011

N TYNWALD

To the Honourable Members of Tynwald Court

The Humble Petition of Marjorie MacMullen, 28 Cannan Court, Kirk Michael, Yvonne Williams, 23, Carman Court, Kirk Michael, Michael Cook and Dorothy Cook both of 26, Carman Court, Kirk Michael and June Young 25 Carman Court, Kirk Michael

WHEREAS

The Petitioners are all owners of freehold bungalows at Cannan Court, Kirk Michael. Certain services are provided by Kirk Michael Community Housing Association, a company limited by guarantee and incorporated in the Isle of Man. However, in recent times a dispute has arisen over the service charge payable by the freeholders and some services have been withdrawn. Despite efforts to communicate no information has been provided and negotiations have broken down.

It appears that there is no remedy at law as existing legislation only covers leasehold property.

Wherefore your Petitioner seeks that Tynwald Court appoints a Select Committee to examine reform of the law relating to service charges with specific reference to freehold property.

Marjorie MacMullen

Yvonn.e Williams

Michael Cook

Dorothy Cook

'June Young

Signatures:-

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6-3/-t/S ,45r)4

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SELECT COMMITTEE OF TYNWALD ON SERVICE CHARGES AND

FREEHOLD PROPERTY (PETITION FOR REDRESS OF GRIEVANCE)

Resolved on 20th October 2010:

"That a Select Committee of three Members be appointed with powers to take

written and oral evidence pursuant to sections 3 and 4 of the Tynwald

Proceedings Act 1876, as amended, to consider the Petition for Redress of

Grievance of Mrs Marjorie MacMullen and others presented at St John's on

5th July 2010 in relation to reform of the law relating to service charges with

specific reference to freehold property."

The powers, privileges and immunities relating to the work of a committee of Tynwald are those conferred by sections 3 and 4 of the Tynwald Proceedings Act 1876, sections 1 to 4 of the Privileges of Tynwald (Publications) Act 1973 and sections 2 to 4 of the Tynwald Proceedings Act 1984.

Committee Membership

Mr J P Watterson MHK (Rushen) (Chairman)

Mr C R Robertshaw MHK (Douglas East)

Mr W E Teare MHK (Ayre)

Copies of this Report may be obtained from the Tynwald Library, Legislative Buildings, Finch Road, Douglas IM1 3PW (Tel 01624 685520, Fax 01624 685522) or may be consulted at www.tynwald.org.im

All correspondence with regard to this Report should be addressed to the Clerk of Tynwald, Legislative Buildings, Finch Road, Douglas IM1 3PW.

Table of Contents

I. INTRODUCTION 1

REMIT OF THE COMMITTEE 2

THE APARTMENT BLOCK AND BUNGALOWS AT CANNAN COURT 3

THE EVENTS LEADING TO THE PETITION 4

LEVELS OF WARDEN SERVICE SPECIFIED AND PROVIDED 5

II. THE MEANING OF "SHELTERED ACCOMMODATION" 8

WHETHER THE BUNGALOWS AT CANNAN COURT ARE "SHELTERED ACCOMMODATION" 8

HOW MIGHT "SHELTERED ACCOMMODATION" BE DEFINED? 10

REFORM OF THE LAW RELATING TO "SHELTERED ACCOMMODATION" 13

III. THE IMPOSITION OF SERVICE CHARGES ON OWNERS OF

FREEHOLD PROPERTY 15

THE DISPUTE OVER SERVICE CHARGES BETWEEN THE PETITIONERS AND KMCHA

15

"TAXATION WITHOUT REPRESENTATION"?

17

IMPLICATIONS FOR SERVICE CHARGES AND FREEHOLD PROPERTY

20

PROPOSED REFORM OF THE LAW RELATING TO SERVICE CHARGES AND FREEHOLD PROPERTY

21

ORAL EVIDENCE

23

13th December 2010

23

26th January 2011

41

APPENDIX 1: Cannan Court site map provided by Planning 65

Authority in the Department of Infrastructure

APPENDIX 2: Letter dated 141 February 2011 from KMCHA 67

APPENDIX 3: Deed of conveyance dated 20th October 1997 from 69

Isle of Man Produce Company to KMCHA

APPENDIX 4: Deed of conveyance dated 17th February 1998 from 83

KMCHA to Parkinson Ltd

APPENDIX 5: Deed of conveyance dated 5th October 1999 from 93

Parkinson Ltd to Mr and Mrs Hurd

APPENDIX 6: Maintenance agreement dated 10th December 1998 103

between KMCHA and Mr and Mrs Renshaw

APPENDIX 7: Submission dated 3rd November 2010 from Mrs 109

Marjorie MacMullen, with attachments

APPENDIX 8: Submission dated 31st October 2010 from Mr 129

Colin Renshaw, with attachments

APPENDIX 9: Letter dated 17th December 2009 from TV 191

Licensing to KMCHA, submitted by KMCHA

APPENDIX 10: Letter dated 27th October 2010 from HM Attorney 193

General

APPENDIX 11: Letter dated 15th December 2010 from HM 197

Attorney General

To: The Hon Noel Q Cringle MLC, President of Tynwald, and the

Hon Council and Keys in Tynwald assembled

REPORT OF THE SELECT COMMITTEE OF TYNWALD ON SERVICE CHARGES AND FREEHOLD PROPERTY (PETITION FOR REDRESS OF

GRIEVANCE)

2010-2011

I. INTRODUCTION

1. The petition of Margaret MacMullen and others was presented on Tynwald Hill on Tynwald Day, Monday 5th July 2010, The petition is reproduced at the front of this report. It explains that the grievance originated from a dispute which had arisen over certain service charges payable by the petitioners to the Kirk Michael Community Housing Association ("KMCHA"). The prayer of the petition reads:

"Wherefore your petitioner seeks that Tynwald Court appoints a Select

Committee to examine reform of the law relating to service charges with specific

reference to freehold property."

2. The petition found to be in order and was picked up by Hon Eddie Teare MHK. It was debated in Tynwald on 20th October 2010, on which date the following resolution was agreed to:

"That a Select Committee of three Members be appointed with powers to take

written and oral evidence pursuant to sections 3 and 4 of the Tynwald

Proceedings Act 1876, as amended, to consider the Petition for Redress of

Grievance of Mrs Marjorie MacMullen and others presented at St John's on 5th

1

July 2010 in relation to reform of the law relating to service charges with

specific reference to freehold property."

Mr Teare was elected to the Committee together with Mr Chris Robertshaw MHK and Mr Juan Watterson MHK. At the Committee's first meeting Mr Watterson was elected chairman. The Committee has met on five occasions.

3. As required by the Standing Orders of Tynwald Court the Committee gave the petitioners the opportunity to give oral evidence in public. This was heard on 13th December 2010. A further public hearing was held on 26th January 2011 at which evidence was heard from Mr David Cannan MHK, Chairman of KMCHA, and from Mr Mike Gardner, KMCHA's financial advisor and the auditor of the KMCHA accounts. The oral evidence is reproduced in full within this report.

4. Written evidence was obtained from the petitioners (and other bungalow residents), KMCHA and HM Attorney General. We issued a public call for evidence and received one submission in response, from Mr John Crimson, for which we are grateful. Items of written evidence upon which we have drawn directly in preparing this report are reproduced in the Appendices to this report. The written evidence in full is available on the Tynwald website.

Remit of the Committee

5. Under Tynwald Standing Order 6.11:

"'Every Petition for Redress must -

(a) relate to a matter of public interest;

(b) relate to a matter falling within the province of Tynwald;

(c) not relate to any specific case which could be or has been

adjudicated upon by the High Court or any tribunal or arbitration, or

any formal officially recognised complaints procedure, unless the

petition shows that in the particular circumstances it is not reasonable

to expect the petitioner to resort, or to have resorted, to such

remedy;..."

6. By implication, a Committee set up to consider a petition is concerned with matters of public interest and is not there to adjudicate on the rights and

2

wrongs of any individual case. Indeed, the prayer of the petition in this case specifically directs the Committee "to examine reform of the law" - that is to say, the law as it relates to everyone, not just to the petitioners and to KMCHA. However, in order to make properly informed recommendations to Tynwald on any lessons or implications for public policy, we believe that it is necessary to understand the circumstances which led to the grievance; and why it has not been possible thus far for the grievance to be resolved.

The apartment block and bungalows at Cannan Court

7. Cannan Court is a residential development in the village of Kirk Michael in the west of the Isle of Man. As will be seen from the site map,' Cannan Court includes one large block: this contains 18 apartments and is referred to throughout this report as "the apartment block". The rest of the site consists of six pairs of semi-detached houses: these are the 12 bungalows referred to in this report, and they include the bungalows owned by the petitioners.

8. The apartment block was designed and constructed in the late 1990s on the initiative of the Kirk Michael Community Housing Association ("KMCHA") and opened in 1998. It was funded by a combination of donations and public funding and remains the property of KMCHA.2 Of the 18 units in the apartment block, there are 8 to which the Department of Social Care has exclusive nomination rights under a contract with KMCHA. The residents of the apartments (whether or not nominated by the Department of Social Care) pay rent to KMCHA at a rate in line with public sector housing.3

9. The bungalows were built at around the same time as the apartment block. However, they do not belong, and never have belonged, to KMCHA. The land on which the bungalows stand was part of the same site in October 1997, when KMCHA bought it from the Isle of Man Produce Company.` The site was then divided and the land not needed for the apartment block was sold in

I Appendix 1 2 Q100 3 Appendix 2 4 Appendix 3

3

March 1998 to Parkinson Limited, a developer.5 Parkinson constructed the bungalows and sold each one on a freehold basis.6

10. Although the bungalows were never owned by KMCHA, a contractual relationship was put in place from the outset between the bungalow owners and the Housing Association. This took the form of a "maintenance agreement" under which KMCHA undertook to provide certain services in return for a service charge. The maintenance agreement was entered into by the initial purchaser of each bungalow and also by each subsequent purchaser when any bungalow was sold.'? The service charge was initially set at £25 per week, to be up-rated in line with inflation. By October 2010 the weekly rate had reached £34.42.

The events leading to the petition

11. The events which led to the petition being presented, with accompanying documents, are set out in written submissions of Mrs MacMullen and Mr Renshaw.8 Based on these submissions, the key dates are as follows:

7th May 2009

27th May 2009

2nd June 2009

4th June 2009

KMCHA sends a letter to bungalow residents advising that the service charge payable under the existing maintenance agreement is now insufficient and proposing an increase of £8 per week.

A meeting takes place between the KMCHA Management Committee and bungalow residents. The question of representation of residents is raised.

KMCHA sends a letter to bungalow residents proposing to create a "General Advisory Committee", to include a representative of the bungalow residents.

Mr Renshaw, one of the bungalow residents, writes to KMCHA in response to their letter of 7th May 2009 refusing to pay the proposed additional charge.

5 Appendix 4 6 See for example Appendix 5 7 An example of the maintenance agreement is at Appendix 6. 8 Appendices 7 and 8

4

5th August 2009

The law firm Corlett Bolton, acting on behalf of KMCHA, responds to Mr Renshaw setting out an alternative proposal. The bungalow residents do not accept this.

16th September 2009 Corlett Bolton writes to the bungalow residents saying that with effect from 28th September 2009 the service provided to the bungalow residents by the warden will be restricted to the level specified in what is referred to as the "Deed of Covenant". An application form is provided for use by any bungalow resident who wishes to restore the earlier level of warden service and is prepared to pay £3.50 per week for this. The descriptions of the two different levels of warden service which are now available are set out at paragraphs 12 to 15 below.

13th October 2009

December 2009

Corlett Bolton sends a further letter to Mr Renshaw in which it makes clear that the offer of participation in an Advisory Committee is withdrawn.

Mrs MacMullen meets Mr David Cannan MHK in an attempt to "clear the air" but, according to Mrs MacMullen's submission, "to no avail".

Levels of warden service specified and provided

12. The specification of the warden service in the maintenance agreement between the bungalow owners and KMCHA is as follows:9

"2. ... the Grantor [KMCHA] doth hereby grant to the Grantees [the bungalow owners] as follows:- (b) to use in the case of an emergency the

telephone and intercom system installed in the premises [i.e. in the bungalow] to notify the Warden residing in the Apartment Block of such emergency..."

In his oral evidence Mr Cannan indicated that on being contacted in such an emergency he would expect the Warden:

9 Appendix 6

5

"to get a doctor, see about an ambulance etc, depending on what the emergency is."10

13. At the time when the bungalows were first being purchased, KMCHA added the following commentary in a lawyers' letter to Mr Renshaw dated 24th November 1998:11

"The duties of the resident's warden include being a 'good neighbour' in

ensuring the general well being of the residents in the bungalow, there will be a resident's warden 365 days a year 24 hours a day, there is also a

telephone/intercom system to contact the warden at all times."

14. The "good neighbour" service mentioned in the November 1998 lawyers' letter is not defined with any precision there, and is not mentioned at all in the maintenance agreement. However, the wording of the 1998 letter would appear to imply that the "good neighbour" service means something additional to the mere emergency contact function. In their oral evidence the petitioners described their experience of such additional services. They included daily visits, holding keys, and holding information as to prescribed medication. While these duties are not specified in the maintenance agreement, it is apparent from the oral evidence that before the dispute arose they were thought - by the warden at least - to have been included in the services to which the charge related. Mrs Cook told us:12

"we came 11 years ago. We did not know the Warden would be calling every

day, which she started to, but we said, we are fine. She said, have to come every day to see if you are okay, because this is what you are paying for.' And

this is what we had up to ten years ago, so we had ten years of it and those were

the instructions we were given."

15. On 161h September 2009 an optional "full warden service" was described in an application form issued by Corlett Bolton to the bungalow residents. From this point on the "full warden service" was only provided to bungalow residents who agreed to pay an additional charge of E3.50 per week. For those who did not pay, the "full warden service" was withdrawn although the

10 Q145 Appendix 8, item 9

12 Q6

6

emergency contact function remained in place. The "full warden service" was defined in the application form as follows:13

"The benefit of a full warden service will provide:

a) a daily check up visit from the Warden

b) in times of illness or distress the Warden will make further visits to

ensure all is well

c) in cases of illness other incapacity or emergency the Warden will

contact relatives if and when requested

d) notification and inclusion in all activities organised by the Warden

in the Apartment Block

e) the appropriate level of care previously provided through goodwill

will be maintained."

The optional charge of £3.50 per week for this "full warden service" was not calculated on the same basis as the proposed £8 per week increase in the overall service charge which had been proposed by KMCHA on 7t1t May 2009 and which had been rejected by the bungalow owners.

13 See Appendix 8, item 20

7

II. THE MEANING OF "SHELTERED ACCOMMODATION"

Whether the bungalows at Cannan Court are "sheltered accommodation"

16. In her submission dated 3rd November 2010 Mrs MacMullen sets out her first ground of dispute with KMCHA as follows:14

"Property I purchased as Sheltered Housing in November 2007, with the care of

a warden available, is no longer deemed to be Sheltered by Mr D. Carman and

the Management Committee of KMCHA."

17. The bungalows at Cannan Court are referred to as "sheltered accommodation" or "sheltered housing" in a number of documents produced from 1994 to 2002, as set out in the following table.

Date 22 Nov 1994

Document Planning application made by KMCHA

Wording "for a sheltered housing development comprising a two storey apartment block... and 12 two bedroom semi-detached bungalows"

Location

Quoted in caveat at Appendix 8, item 11

18 Nov 1997 KMCHA to residents of Kirk Michael, page 2

"There will be constructed, adjacent to the sheltered housing apartment block, semi-detached two bedroom bungalows for freehold sale to persons who require sheltered accommodation."

Appendix 8, item 2

14 Appendix 7

8

Undated Advertisement by Parkinson Ltd

8 Nov 2002 Caveat filed in the Deeds Registry "in the matter of ,.. 12 semi-detached dwellings"

14 Nov 2002 Letter from KMCHA to Mr and Mrs Renshaw

"Cannan Court: 12 Sheltered Bungalows" "7.... Kirk Michael Community Housing Association further claims that the ordinary and natural meaning and sense of the term 'sheltered housing' is residential accommodation for elderly and handicapped persons consisting of private independent units with some shared facilities and a warden." "The use of your house is restricted to a private dwelling 10 house as sheltered accommodation"

Appendix 8, item 8 Appendix 8, item 11

Appendix 8, item

Date 9 Mar 1998

Document Deed of conveyance from KMCHA to Parkinson Ltd, Schedule 4

Wording Location "1, No building or structure shall Appendix 4 be erected placed or permitted to stand on the Scheduled Property other than a maximum of fourteen (14) semi-detached dwellings... conducive to the development of the Scheduled Property as Sheltered Accommodation ...

4. Any dwelling house or premises erected on the Scheduled Property shall be used as a private dwelling house only as Sheltered Accommodation and no trade or business of any kind shall at any time be carried on upon the Scheduled Property..."

18. At some time after 2002 the Management Committee of KMCHA appears to have determined that the bungalows should not be termed "sheltered housing". A letter dated 14th January 2010 from the Committee to a Mr Parkinson, submitted to us by Mrs Yvonne Williams, reads as follows:

"The Management Committee's response to your letter dated 581 January 2010

is that the bungalows at Cannan Court are within the sheltered housing

complex but each bungalow is not in itself sheltered housing as the bungalow is

owned freehold by the resident."

9

Similarly, the paper circulated by KMCHA in Tynwald during the debate in October 2010 includes the statement:

"The bungalows are owned freehold and are not sheltered housing."

19. In his oral evidence Mr Carman made the following statement about the bungalows:15

"They are not sheltered housing, as far as the Kirk Michael Community

Housing Association is concerned, because the Kirk Michael Community

Housing Association has no control whatsoever over their construction."

He also made it clear that he considered that a key element of sheltered accommodation was the existence of some regime under which that accommodation would be allocated.16 On being reminded of the terms of the caveat filed in November 2002 and of the letter sent by KMCHA to Mr Renshaw in that month, Mr Cannan offered the following explanation:17

"The expression 'sheltered accommodation' has been used when it should have

been 'elderly persons' accommodation'... it has been filed by mistake."

As mentioned above, our remit is not to adjudicate on the rights and wrongs of any individual case. We need make no comment, therefore, on the gap which has arisen between the petitioners' understanding of the term "sheltered housing" and the view of KMCHA, although we will allow ourselves to observe that the divergence of views is unfortunate. Our concern is to examine any implications of this experience for possible reform of the law.

How might "sheltered accommodation" be defined?

20. The petitioners, in their oral evidence, have identified a number of features which they would expect of any arrangement characterised as "sheltered". The first is:

• the presence of a warden service.

15 Q75 16 Q73

(2q 80 to 81

10

Mrs MacMullen said:

"Sheltered housing to me implies the care of a Warden. That to me is almost the

very basic unit of sheltered housing."

By "the care of a warden" it is apparent from the oral evidence that the petitioners would expect more than merely a presence capable of responding to an emergency cal1.18 It is not clear, though, exactly how much more they would expect or whether they would all have the same view.19

21. A second potential feature of sheltered accommodation identified by the petitioners is:

• a possible restriction on the age of person who may own or occupy the property.

Mr and Mrs Cook were advised that their property could not be sold to anyone under 50,20 although we have not in fact seen this restriction stipulated in the deeds or in the maintenance agreement. Different age limits may be in place in different places. We were advised by the planning division of the Department of Infrastructure that from their point of view "sheltered housing" was an expression which seemed to be used by developers for housing for people over 55 (even though most people of that age and older do not have specific needs), possibly with the intention of circumventing affordable housing or parking requirements.

22. Rather than just having an age limit, sheltered housing is sometimes assumed as being:

• available only to residents with a particular physical or mental need, which could arise from age or from disability.

The informal advice we received from the Department of Social Care was that from their point of view one of the main features of sheltered housing in the public sector was the existence of an allocation regime which ensured

18 See Q53 19 See Q49 20 Qg 29-30

11

sheltered housing was occupied by people who needed it. As mentioned above, this criterion was supported by Mr Cannan in his oral evidence.21

23. A third potential feature of sheltered accommodation identified by the petitioners is:

• the availability of a concessionary TV licence for residents under 75

The letter quoted by Mrs Cook in her oral evidence says that the concession was withdrawn because KMCHA was no longer responsible for the management and provision of care in the bungalows.22 However, the letter supplied by Mr Cannan says the concession was withdrawn because the bungalows were freehold. It makes no mention of the term "sheltered housing".23 In our view it would be wholly inappropriate to give wider application to any definition of "sheltered housing" which may have been adopted as a matter of policy by the TV licensing authorities.

24. A fourth potential feature which might be included in any definition of "sheltered accommodation", drawn from the 1998 conveyance by which the developer sold the bungalows to the original residents, might be:

• a prohibition on the carrying on of any trade or business in the property

25. Following on from the petitioners' experience with KMCHA, we have inferred that another potentially valuable feature of any "sheltered accommodation" arrangement might be:

• a degree of representation or participation by service users in the management of the services associated with the accommodation

although it is fair to say that Mrs MacMullen at least was ambivalent about how essential this might be.24

26. As with any contractual relationship we might also recommend:25

21 Q73 22 Q59

23 Appendix 9 24 Q58

12

• some form of explicit dispute resolution procedure

27. As noted above, KMCHA has suggested that in addition to being subject to an allocation regime, the following should be a defining feature of sheltered accommodation:

• that the property should be rented or leasehold and not freehold

28. These are not the only potential features of "sheltered accommodation". In his submission, Mr John Grimson, a resident of another sheltered accommodation complex, Ballastowell Gardens in Ramsey, identifies three further features of what he calls the "sheltered housing concept":

• that residents should not be in regular employment

• that leaseholders (or, presumably, owners) should occupy the

property rather than sub-letting

• that the property should be occupied all year round rather than

being left empty and used as a holiday home.

Reform of the law relating to "sheltered accommodation"

29. The evidence referred to above illustrates that there exists a wide diversity of opinion as to what constitutes "sheltered accommodation". The petitioners made it clear that they favoured a reform in the law which would remove the uncertainty in the meaning of the expression "sheltered accommodation", which appears in their deeds. We sought confirmation from HM Attorney General as to the current legal position. He responded:26

"I am not aware of any definition of 'sheltered accommodation' in Manx or

English law."

30. To have effect in circumstances such as the petitioners' any reform of the law on sheltered accommodation would have to regulate the sheltered accommodation market, presumably by imposing a minimum standard which anyone providing "sheltered accommodation" would be obliged to adhere to. We have given careful consideration to this proposal.

25 Qq33, 40 26 Appendix 10

13

31. The main advantage of the proposal is that it might conceivably protect those procuring sheltered accommodation from unscrupulous providers who might exploit the vulnerability of sheltered accommodation service users by over-promising, under-delivering, imposing unfair charges etc.

32. Potential disadvantages of the proposal would include the following points:

• to achieve an agreed minimum standard in such a diverse market would be fraught with complexity. If the minimum standard agreed was merely a "lowest common denominator" of existing provision, little would have been achieved;

• if a higher standard were set for the industry this could drive prices up or discourage new entrants to the market, neither of which outcomes would assist the vulnerable;

• the only way to impose higher standards and lower costs for service users would be to introduce some kind of public subsidy, which in these economic times is not a realistic option;

• it would be difficult to prevent providers from circumventing any regulatory regime simply by characterising their services using different terminology (such as "accommodation for elderly persons", "supported accommodation", etc)

• an agreed standard would fall to be enforced through the courts, which would not be without cost both to service users and to the taxpayer.

33. Given these concerns we do not think that the existence of a regulatory regime for the sheltered accommodation sector could be relied upon to prevent circumstances such as the petitioners' arising again in the future. On balance, therefore, we have decided not to recommend the introduction of such a regime.

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III. THE IMPOSITION OF SERVICE CHARGES ON OWNERS OF FREEHOLD PROPERTY

The dispute over service charges between the petitioners and KMCHA

34. In her submission dated 3.'d November 2010 Mrs MacMullen sets out her second ground of dispute with KMCHA as follows:27

"I am paying part of the salary of a warden whose services have been denied me

since Sept 2009."

35. The first part of Mrs MacMullen's statement - that she is paying part of the salary of a warden - is undoubtedly true. This is made perfectly clear by the KMCHA accounts which we have examined, and it is not disputed by KMCHA.

36. Mrs MacMullen says she is paying for "a warden whose services have been denied me". KMCHA would dispute this. Their position is that the warden continues to provide a service to the bungalow residents, albeit a service which has been reduced to the "bare bones" of what is specified in the maintenance agreement. Even to provide an emergency point of contact, the warden still has to be employed. As Mr Gardner put it in his oral evidence:28

"If somebody has a fall every single day of the year, the Warden would be there

every single day of the year. The fact that they don't is hardly the Association's

problem."

We consider therefore that it would be fair to say that Mrs MacMullen is paying part of the salary of a warden some of whose services have been denied to her since September 2009.

37. In fact the evidence we have seen and heard goes further than this. It shows that the service charge paid by Mrs MacMullen and the other bungalow owners is also contributing to the salary of the KMCHA secretary and

27 Appendix 7 28 Q161

15

potentially to other items of KMCHA expenditure which may have a greater or lesser degree of direct benefit to the bungalow owners.

We have established that if KMCHA did not have the income from the bungalow service charges, then either the rent paid by the apartment residents would have to be increased, or there would have to be additional fundraising.29

38. There was no clear line of sight from the overall KMCHA accounts to the "Bungalow maintenance account" which were made available to the bungalow owners. The bungalow owners found this unhelpful, as did we.

39. We consider that the key question in the dispute is whether it was fair and reasonable for KMCHA in September 2009 to "partition" what had, for 10 or 11 years, been a "unified" service and to create for the first time a two-tier regime, where the bungalow residents received a lower level of service in return for their contractual service charge, but could opt for the "full warden service" in return for an additional charge. On the one hand KMCHA argues that it is operating within the letter of the written maintenance agreement. On the other hand the petitioners argue that the change represents:

• a departure from an understanding which, although not in the maintenance agreement, had been documented to some extent in extra-contractual documentation such as the letter from KMCHA to Mr Renshaw dated 24th November 1998,30

• a departure from what had become an established practice since the entire complex opened, and

• a step which was contrary to the spirit of a "sheltered housing" regime operated by a community housing association.

If it were found that it was fair and reasonable to institute a two-tier system in these circumstances, a further question would be whether the proposed charge of £3.50 per week for the "full warden service" was set at the right level, and on what basis this was calculated.

29 This was confirmed by Mr Gardner at Q1.71 3° Appendix 8, item 9

16

40. As a Tynwald Select Committee it is not our role to adjudicate on these questions but to consider their wider policy implications.

"Taxation without representation"?

41. At the time when the dispute arose in 2009 the bungalow residents were subject to the service charge imposed by the maintenance agreement but had no say in the management or administration of the services themselves. They were, in effect, subject to "taxation without representation".

42. The problem of "taxation without representation" might have been resolved by introducing some form of representation, in the form of participation by the bungalow residents in the management of Cannan Court. This was discussed at the meeting between the KMCHA Management Committee and the residents on 27th May 2009 and an offer was subsequently made by the Management Committee on 2nd June 2009; but as things turned out it was not to be, and the offer was formally withdrawn on 13th October 2009.31

43. The other way to resolve the "taxation without representation" problem would be for the bungalow owners to be released from the "taxation" element, that is, from the service charge and the rest of the maintenance agreement. However, the bungalow residents assumed that they were bound by the terms of their deeds to remain in a contractual relationship with KMCHA - an assumption which appears to have been shared by KMCHA itself.

44. We have examined the basis for this assumption. It will be recalled that having bought the land for the whole site from the Isle of Man Produce Company in 1997, KMCHA sold the land for the bungalows to Parkinson Ltd on 17th February 1998;32 and that Parkinson Ltd later sold the bungalow to the various purchasers.33 At the same time as buying the properties, the purchasers entered into a maintenance agreement with KMCHA, believing themselves to be under an obligation to do so. The wording of the

3' Appendices 7 and 8 32 Appendix 4 33 Sample conveyance at Appendix 5

17

maintenance agreement itself reinforces this belief, stating in its opening recitals:34

"Whereas... (3) it was a term of the aforesaid Deeds of Conveyance dated the

17th day of February and the [11th] day of December 1998 that these presents be

entered into by the Purchasers of the Units erected on the Parkinson Estate..."

45. We examined the deeds of conveyance referred to in the maintenance agreement in search of the "term" requiring that owners of the bungalows enter into a maintenance agreement with KMCHA. We found no such term. We invited HM Attorney General to advise on this point. He found no such term either, and wrote:35

"I am therefore at a loss to understand the justification for the statement in

Recital 1(3) of the Maintenance Agreement that it was a term of the Deeds of

Conveyance dated the 17th February 1998 and the 11th December 1998 (referred

to above), that Mr & Mrs Renshaw should enter into a Maintenance

Agreement... the Purchasers therefore may wish to consult with their Advocates to query this point and refer to any advice which was received at the time of

their purchase regarding an obligation to observe the provisions of the

Maintenance Agreement."

46. It came through in the oral evidence that at least some of the bungalow residents would wish to sever their links with KMCHA. Mrs Cook said:36

"Well, what we would like really, we would form our own committee and then

we would run it how it should be, but also class it as for elderly people from 50 plus, would live in them, so it would keep that contained for the elderly and that

would just be an agreement that would go along with the sale. We would look

after it in the way that it has to be looked after."

For its part KMCHA in the following exchange gave a commitment to look at this option:

"Mr Teare: ... if the freeholders, in effect, stepped aside, rather than the services

provided by the Kirk Michael Housing Association, including the maintenance,

34 Quoting from the sample maintenance agreement at Appendix 6 35 Appendix 11 36 Q43

18

and set up their own arrangement for it, and took it away from you. Would that

be acceptable to you?

Mr Cannan: It would be acceptable, in the sense that we would call a meeting

of all the bungalow people and explain to them that, if they wished to withdraw

from the agreement in toto, it would be completely in toto. Then there may be

concerns expressed by other bungalow residents who wish to have the

agreement, that they had the agreement on the understanding that all the

properties would be maintained to a standard, or the garden maintained to a

standard, etc. We would seek their views as well, but we have not made a

definitive decision, but we have basically said yes, subject to those who have

signed the agreement, in the knowledge that everybody else has signed it, and

therefore the gardens are maintained, the property is decorated, etc. So it

maintains the standard of the community.

Q98. The Chairman: But according to the evidence that you have given, the

agreement is a private contractor agreement between a householder - not the

bungalows en bloc, but a householder - and the Kirk Michael Housing

Association. Given that it is essentially just a contract, by mutual agreement

that contract can be ended. If it was the wish of a bungalow holder, it would

then be a case of whether the Housing Association would be willing to -

Mr Cannan: In all probability, but it is a question of how do you put the question? It could be a question that could be addressed but, following this

inquiry into a report, the committee will be addressing it. That I think you can

be assured of

Q99. The Chairman: When you say 'addressing it', what do you mean?

Mr Cannan: Addressing the indication that the option will be given. All

bungalow owners will be contacted and given the option."

47. It is not our function to resolve the particular dispute which gave rise to the

petition and our observations should not be taken as a substitute for each

party obtaining his or her own legal advice. Nevertheless we hope that our

observations will prove to be of assistance both to the bungalow owners and

to KMCHA.

19

Implications for service charges and freehold property

48. The general position with regard to service charges and freehold property was described by HM Attorney General in his initial written evidence as follows:37

"typically, a management company will be responsible for providing the

services in question with the various tenants being shareholders in that

management company."

In a later submission he added that:38

"it is unusual for the owners of freehold properties to enter into Service Charges

Agreements. Ordinarily, obligations to pay or contribute to the cost of

maintaining freehold properties would be dealt with by way of covenants in Deeds of Conveyance or transfer - they would not ordinarily be separate Service Charges Agreements which are more normally encountered in connection with

leasehold properties."

49. We consider that many of the features of the dispute at Cannan Court arose out of the unique circumstances of the case. KMCHA originated a novel arrangement under which they sold land adjoining their apartment block for freehold properties, but then entered into a contractual agreement with the freeholders for services related to those properties. Innovation in providing services to the community is to be welcomed. Unfortunately, mistakes were made along the way. Mr Cannan described as flawed the charging structure which was adopted;39 and as "by mistake" the filing of a caveat referring to the bungalows as "sheltered accommodation ".40 The bungalow owners accepted the terms of the maintenance agreement, even though it did not set out in full the terms of the warden service which they expected to receive, it did not afford them any right of participation in management decision-making, and it did not set out any dispute resolution procedure. The maintenance agreement between KMCHA and the bungalow owners was presented as though it were a requirement under the deeds of conveyance, a

37 Appendix 10 38 Appendix 11 39 Q65 40 Q81

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proposition whose justification HM Attorney General is "at a loss to understand".41

We have concluded that in any circumstances where there are service

charge obligations between a management company and freeholders,

the freeholders should be able to form a residents' association and play

an active role in the making of decisions by the management company

which directly affect the freeholders' interests.

Proposed reform of the law relating to service charges and freehold

property

50. We would not wish to prevent developers and service providers from setting up arrangements similar to those at the Cannan Court bungalows in future, if that is their wish. However, if such arrangements are to be set up, they must be set up with due care and attention. Where "sheltered accommodation" is concerned, moreover, particular regard should be paid to the possibility that freeholders and service users are likely to be more vulnerable than the general population.

51. No change to the law on service charges could in itself ensure good practice in the development of innovative arrangements in future by the private and voluntary sectors. However, we consider that an extension of the Property Service Charges Act 1989 might help. HM Attorney General advised us that this Act enables tenants to appeal to the Rent and Ratings Tribunal for a determination with regard to the reasonableness of expenses which make up a service charge.42 If such an appeal were in prospect in relation to freehold property, then we consider that persons setting up freehold service arrangements in future might reasonably be expected to go to greater lengths at the outset in order to prevent disputes arising later on.

52. How far should the remit of the Rent and Ratings Tribunal be extended? To enable it to determine the reasonableness of all charges for services supplied to freehold properties could lead to absurd results. What if all the freeholders in a particular street were to form an association and engage a window-

41 Appendix 42 Appendix 11

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cleaner to clean all their windows once a month? This might involve a charge, payable to the window-cleaner, for a service in relation to freehold property, i.e. window-cleaning. But we would not consider it an appropriate matter for the tribunal.

53. We suggest that the defining characteristic of a charge which ought to be appealable to the tribunal is that it should be a charge which a freeholder cannot avoid (other than by surrendering the freehold). In other words, if it had been the case at Cannan Court that, as the bungalow owners believed, it had been a condition of their deeds that they remain in contract with KMCHA, then any charges imposed by KMCHA should have been subject to the supervision of the tribunal. In the window-cleaning example, on the other hand, the tribunal need have no role because any or all of the freeholders would be free to substitute a different window-cleaner at any time. We think that circumstances in which the extended Act might apply will be rare, but that the reform is nevertheless worth putting in place in the interests of preventing a recurrence of the experience undergone by the petitioners.

Recommendation

That the provisions of the Property Service Charges Act 1989 be extended to apply to service charges in relation to freehold property, but only:

(a) in circumstances where payment of the service charge concerned is an obligation which the freeholder cannot avoid other than by surrendering the freehold; and

(b) where service charges are applied in relation to a "sheltered housing" agreement (whether and however defined), on the basis that residents subject to such agreements are likely to be more vulnerable.

J P Watterson (Chairman)

C R Robertshaw

W E Teare

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EARLY PUBLICATION (4.55 p.m., 19th January, 20110

PROCEEDINGS OF THE SELECT COMMITTEE OF TYNWALD

ON SERVICE CHARGES AND FREEHOLD PROPERTY

(PETITION FOR REDRESS OF GRIEVANCE)

EPTSCFP 131210

Douglas, Monday, 13th December 2010

Afternoon Session: 3.00 p.m. — 4.07 p.m.

The Committee sat in public at 3.00 p.m. in the Legislative Council Chamber,

Legislative Buildings, Douglas

[MR WA1TERSON in the Chair]

Procedural

The Chairman (Mr Watterson): Good afternoon, everyone and may I welcome you to this sitting of the Select Committee of Tynwald on Service Charges and Freehold Property and Petition for Redress of Grievance. My name is Juan Watterson MIRK and I am the Chairman of this Committee. I am joined by Mr Eddie Teare on my right and Mr Chris Robertshaw on ray left. The Clerk to our Committee is Jonathan King and our Hansard reporter is Mr Clive Alford.

Can I ask you at this point, please, to switch off any mobile phones, not just put them on silent, but switch them off, as they interfere with the recording equipment.

The Committee was established by resolution of Tynwald on 20th October 2010 and the motion was that a select committee of three members be appointed, with powers to take written and oral evidence pursuant to sections 3 and 4 of the Tynwald Proceedings Act 1876, as amended, to consider the Petition for Redress of Grievance of Mrs Marjorie MacMullen and others presented at St John's on 5th July 2010 in relation to a reform of the law relating to service charges with specific reference to freehold property. The Prayer of the Petition reads:

'Wherefore your petitioner seeks that Tynwald Court appoints a select committee to examine reform of the law relating to service charges, with specific racier= to freehold property.'

Tynwald Standing Order 5,10 says a select committee appointed to investigate a Petition for Redress of Grievance presented at St John's 'shall, unless satisfied that there are exceptional reasons for not doing so,

Published by (e.=!) the High Court of Tynwald, 201 I

23

SELECT COMMITTEE, MONDAY, 13th DECEMBER 2010

20 hear evidence from the petitioner in public and such evidence shall be recorded, transcribed and published.' I am glad to say that we are able to comply with this and we have the petitioners with us today. Thank you very

much for coming. I would say to the petitioners at this stage that, as a Committee, we cannot take a view on any individual

case and, indeed, you have recognised this in the prayer to your petition, which asks us not to adjudicate in the 25 dispute between you and Carman Court, but to examine reform of the law. That said, in order to make any

wider recommendations, we do need to understand fully the circumstances which led to the position we now

find ourselves in.

If t could just ask you, before we get into any opening statement that you might have, to go along the line and introduce yourselves for the purposes of the record and then I will ask you if you want to make any

30 opening statement. Okay? If we can start at this end, please.

Mrs Young: My name is June Young.

Mrs Williams: Mrs Yvonne Williams, 23 Cannan Court. 35

Mrs MacMullen: Marjorie MacMullen, 28 Canna]] Court.

Mrs Cook: Mrs Dorothy Cook, 26 Carman Court.

40 Mr Cook: Michael Cook, 26 Carman Court.

EVIDENCE OE MRS ,11 YOUNG, MRS Y WILLIAMS, MRS M MaeMULLEN, 45 MRS D COOK AND MR M COOK

QI. The Chairman: Thank you. Do you have any opening statement that you would like to make before

we proceed with some questions?

50 Mrs MacMullen: I have not, personally, but presumably, would you ask us — it is a bit in advance — but

are we likely to be asked at the end of the session, if we have anything further to add?

The Chairman: I am happy to do that, yes.

55 Mrs MacMullen: Thank you.

The Chairman: Okay. Do you want to go first?

Q2. Mr Teare: Thank you very much and thank you for coming in this afternoon. 60 Just to give us a bit of background information, could you explain how the agreement to enter into, in

effect, a monthly maintenance arrangement, actually arose? Did it arise as part of the original sales documents, when the property was originally offered for market at the outset, or was it something that came

in later?

65 Mrs MacMullen: No, it was with our original purchasing papers from the advocates. It was in my case, I

cannot speak for my fellow members here. It was part of the transaction papers. I am looking — searching for

the word — conveyancing documents. It was part of that.

70 Q3. Mr Teare: If I am right, at the outset it was £25 a week.

Mrs MacMullen: It started at that.

Q4. Mr Teare: As part of that, or in respect of that payment, what did you understand that you would

receive? 75

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Mrs MacMullen: Exactly what it said on that management agreement, that we would have our grass cut services; we would have a telephone — a carephone attached; our properties would be painted on a tri-annual basis; that we would have access to public rooms and Facilities in the main house, and that we would have Let_ that would be without let or hindrance to the main block. That was part of the management agreement with us.

Q5. Mr Teare: What provisions within that agreement were there to review the payment?

Mrs MacMullen: On an annual basis, and the payment would be adjusted, according to the annual rate of inflation.

Q6. Mr Teare: Within the agreement, was it your understanding that you would have the services of the Warden as well?

Mrs MacMullen: Not in that particular agreement, no.

Mr There: Okay, thank you.

Mrs Cook: Can I just come in, because we came I I years ago. We did not know the Warden would he calling every day, which she started to, but we said, we are fine.

She said, 'I have to come every day to see if you are okay, because this is what you are paying for.' And this is what we had up to ten years ago, so we had ten years of it and those were the instructions we were given.

Mrs Young: I would like to add that, on my welcome to Carman Court complex... 'I wish to advise you of the terms of management. There is a weekly sum payable in advance to Cannan Court, which covers the cost of the Warden cover, grass cutting, three-year cycle of painting the outside of your bungalow and for the use of shared facilities in the main Carman Court building,'

That is dated 2nd October 2008.

Q7. The Chairman: So it is your impression that it was part of the overall package. Everyone seems to be nodding agreement with that.

Could you summarise perhaps, at this point, what the main purpose, the main focus of the dispute is,

please?

110 Mrs MacMullen: I speak for myself on this. The main purpose of this dispute is that, in May 2009, we were invited to a meeting with the Kirk Michael Housing Association to discuss the question of deficiency in Funds. This was the reason why we were called, because there was obviously... it was declared that there was a deficiency. I did submit this in my general submission on this one, actually, but that was the reason.

So we attended this meeting. This is, you understand somewhat of a précis without looking into the letter,

115 this is a précis account, but we were invited to this, because there was a deficiency in the funds and, at that stage, or: 27th May --- on 7th May. rather the letter summoned us. On the 27th we attended the meeting and it declared there... it was stated that the deficiency had arisen because of the tri-annual painting, which was in excess of what was expected, as far as their funds were concerned. We disputed this at the meeting and then we retired to our various properties, but then our... so that was the start of the affair.

120 We were quite confused by this, going back to that particular meeting, because we had accounts, which did not seem to, particularly, support the cause, as I had bought my bungalow in the year 2007 and the deficiencies on the accounts were shown back as far as 2005. 1 felt, personally, that I was not responsible for deficiencies that had been ongoing since the year 2005. It was established at that meeting by the Chairman of the Kirk Michael Housing Association, at the end of that meeting, that a line would be drawn on this

125 deficiency and so we all departed to our various houses at that point. That was the start of the dispute that we have.

Q8. The Chairman: So you were happy with the service you were getting and that you were getting —

130 Mrs MacMullen: That was not mentioned whatsoever. The emphasis was then on the deficiency in

accounts, which were attributed largely to entirely to the painting tri-annually and it was suggested and

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read out at that, certainly a letter had been sent by another member of the.,. another bungalow owner that, if

this was the case, we could perhaps make some kind of adjustment to whether the houses needed to be painted

tri-annually, whether that could be extended to four or even five years, but that was never explored further.

Q9. Mr Teare: During this meeting when you were approached to, I take it, increase the maintenance

payment, was any detailed breakdown given for the expenditure which had been incurred by the charity as a whole?

Mrs MacMullen: Accounts, are you referring to, Mr Teare?

Mr Teare: Yes, in accounts, Mrs MacMullen.

Mrs MacMullen: Yes, they were, but we could not... they were confusing, to say the least, and they were contradictory in many cases. I think Mrs Cook and Mrs Williams could answer those questions more clearly

than I could. That is as far as I go at the moment.

Q10, The Chairman: In what sense were they contradictory, if I can tease that out of you, having made

that statement?

Mrs Williams: The original letter to invite us to this meeting on 27th May, gave out the proposed increase

is £8 per week extra to the increment that had already been paid by us for the rate of inflation in April. Apparently, we were informed, the accounts — our accounts, we were supposedly in debt to the tune of

£13,999, which was very daunting, to say the least. We faced the committee with this and we were informed 155

that there was not enough money for the painting of our properties, because it had all been swallowed up in

wages; the wages of staff of Cannan Court. In our deed of covenant, contract, whatever you want to call it, there is absolutely nowhere that it states

that we have to foot the bill for the staff of Carman Court. It gives that we should have access to the public rooms 'without let or hindrance', it is printed in here we will have use of the carephone, have our grass cut -

160

seasonal, of course every week and that we will have our properties painted in a three-year cycle. That is

what we were supposed to be paying for. It comes about that we are paying a huge amount towards the staffing of Carman Court and I draw your

attention to that dreadful article in the paper last week, in the Examiner, which stated,

165 'The committee explained that, for a £23 a week Fee

- let me tell you that it is now £34,42 —

170 'the committee allowed the freehold residents use of the. communal Facilities. The committee also maintained the property.'

Mostly incorrect. We have a lick of paint put on our properties every three years and, also, 'free of charge'

said the management, the Warden services for the leasehold tenants, which are in the block, was extended to

the freeholders, which is us. So the 'free' Warden service was withdrawn from us last September and when I moved in six and a half

175 years ago, I said to, then Mrs Davies, you do not need to call on me every day, Margaret. 'Oh, but I will, love,' she said. It is what you pay for.' Now we are told that that is not what we arc entitled to any more and,

fair enough, I do not really care about the Warden, but there are many people who do.

On 1st May this year a new Warden was appointed and I would not know her, if I fell over her, because

she has never been round and introduced herself, she has never been introduced to us and this woman has free 180

access to our properties, because it is a pass key and she also has our personal information in the office at

Cannan Court at her perusal.

I would like to draw attention to that appalling statement that was said to be... the committee gave last

week: that it is completely untrue.

185 Q11. The Chairman: Is that the management committee, rather than the Select Committee.

Mrs Williams: Well, it says, the committee'.

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The Chairman: Mr Robertshaw. 190

Q12. Mr Robertshaw: Good afternoon. wonder if you could help me with One particular point. The issue is quite often mentioned about facilities

inside the main block and I am not absolutely clear what those facilities provided for you. Would one of you

195 be kind enough to detail what are those facilities in the main block?

Mrs MacMullen: It is the use of the laundry. There is a laundry. There are public rooms which,

incidentally, we are charged for in our use, for the cleaning of these public rooms. There is also a flat —overnight accommodation which we did have access to, if we wanted visitors to stay. That has been

200 withdrawn. But the laundry services and the use of the public rooms.

Q13. Mr Robertshaw: To your recollection, were each of you escorted round these facilities and had

these explained to you?

205 Mrs MacMullen: At the time, no. I was not, no.

Q14. Mr Robertshaw: At what stage did you become aware that these facilities were available?

Mrs MaeMullen: It is stated in the agreement that we made.

210 Q15. Mr Robertshaw: Okay, thank you very much for that. With regard to this buildup of the deficiency, which you have mentioned, was this presented to you one

year as £13,000 or had you become aware of it in prior years, as it built up?

Mrs Williams: Well, it is £13,999, we were told at this meeting on 27th May, 2009. The year before, 215 looked at the accounts. The year before, in May 2008, I wrote to the committee and I will actually read it to

you:

220

would like to state that I have thought about and studied your bungalow maintenance accounts carefully. Even after this period of time, I still cannot make head or tail of diem. I enclose a photocopy of the maintenance account plus assumptions so that 1 may retain my copy.'

The figures are completely scrambled and these accounts represent three years of our payments to DIB????

This was prior to the 2008 repainting. have a sheet of the accounts that was sent to me in... They are 2007 accounts, actually, but they were

225 sent me, because of my letter. I asked quite a few questions in my letter, and I actually did ask for a meeting

with David Carman and the committee, to discuss what this so-called deficit was all about. I had a reply,

which was 26th May 2008:

Your letter dated 15th May is acknowledged and my response is as follows. Salaries: the reason why the salaries account for 2007 was less than 2006 was due to staff sickness. Grass cutting: it was irregular and unsatisfactory and a formal contract was made with Mr Collins for the 2007 season. The contract was renewed for the 2008 season. External decoration: over the past 10 years the cost of external decoration has increased at a level greater than the official rate or inflation and the maintenance charge for the bungalows is

assessed on the Government's official annual rate of inflation. Please be reassured that your bungalow will receive extents!

decoration daring the next few weeks and all the other services will continue as normal.... sending a copy of your letter and this

reply to Kirk Michael..,'

I think that is the accountants — Michael Gardner, I think his name is.

So there was no answer to my enquiry to have a meeting about this so-called deficit. I have the figures

here and. at that time, the so-called deficit was, I think, £7,928. It certainly was not £14,000, all but a pound.

Q16. Mr Teare: Can I just ask you something more, following on from that, Mrs Williams, just to help

my understanding of it. The accounts were felt to be misleading, not easy to follow and something you said: a

sheet of the accounts had been sent to you. Am Ito take it from that, that you did not receive the whole set of accounts?

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235

240

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Mrs Williams: Well, the accounts that we all get.

Mrs Cook : We only get bungalow accounts. I have got the full set of accounts, but they do not tally with what we have got.

Mrs Williams: Anything that is shown in brackets is regarded as a deficit.

Q17. Mr Teare: Right, if I could just lead on from that, from your perspective, the accounts... you did not have access automatically to the whole set of accounts and the information which was provided to you did not give you the whole picture, whereas the contributions which you made through your management fee went in to pay, in your opinion, a contribution towards the total costs of the complex. That is how you see it?

Mrs Williams: The complex, of course, also includes the main block building. This is... we are given the accounts for our bungalows, which is a set of semi-detached bungalows. There is nothing ever shown about

the main block being redecorated, or what cost it is or anything like that.

Q18. Mr Teare: Then, do you think it would have been more transparent, if the... In effect, there have been two sets of accounts prepared; a maintenance account for the bungalows and a separate maintenance account for the main block, with the income and expenditure going into the respective accounts.

Mrs Williams: It would help, because getting to the point where what our money — and it is a considerable amount of money that we actually do pay out. I have got it here somewhere. I am getting a bit muddled up with my papers.

Mr Robertshaw: There is no rush at all. Please take your time.

Mrs MacMullen: I have the actual breakdown. On this, if I might add, Mr Teare, to this one. On the accounts that we receive, they are headed 'Kirk

Michael Community Housing Maintenance Account', so that comes to us and that shows expenditure for 275

salaries and it goes back three years at a time: salaries, grass cutting, care telephone, use of public rooms and office supplies.

Then it goes: transfer for the year, transfer maintenance reserve, balance forward. That is the extent of the accounts that we receive, but on a breakdown and on further correspondence with the committee when we were trying to follow this up, the breakdown came and this was actually a letter received from KMCHA. The

280 income from the bungalows worked out at £20,135, grass cutting £2,389, carephone £1,020, set aside money for tri-annual painting £3,208. The total expenditure, as far as the breakdown of our contribution comes to £6,617, which therefore means that the sum of £13,518 is being paid to Kirk Michael Housing Association by the bungalow residents for the salaries and upkeep of public rooms.

We, at the present, receive no service from the Warden and we do not use the public rooms, for which we 285 are... we are subsidising the use of these and that seems, on a very basic level to be absolutely wrong in

simple terms.

Q19. Mr Teare: Mrs MacMullen, when this all arose, was there a willingness on the part of yourself and

290 your other freeholders to negotiate this?

Mrs MacMallen: Plenty of evidence of that, actually, because the letters were sent. Mr Renshaw wrote on our behalf, because you will appreciate that, as a group of people, some of us go and some of us come back.

So in the interests of continuity, and the fact that Mr Renshaw was the oldest resident, as far as the bungalow complexes were concerned, he continued with the correspondence. Mr Renshaw wrote on our behalf on 4th

295 June. I think his letters, copies of which are in your possession, have been sent. We received a letter on 5th August from Corlett Bolton — at least Mr Renshaw did. On 10th August,

information was given to us about a proposal, which we rejected. On 8th September a letter From Corlett Bolton, stating that the Warden's visits would cease on 28th September. Mr Renshaw wrote on 13th October — this is when he had the breakdown of the accounts which I have just spoken of and, further, in an attempt

300 to clear the air — because you can imagine now, this has been going on since May and we are now in

December I made a particular attempt, because I felt it was all getting silly, and the correspondence was

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completely... mostly irrelevant and full of red herrings, as far as we were concerned, as to why these sums of money were being juggled about and presented to us.

I asked for an appointment to see Mr David Cannan in December of that year, in 2009. I went to sec him, 305 but it was to no avail, because he was adamant, and at this stage, in spite of my mentioning various other

factors, he brought in this fact that it was nothing whatsoever to do with bungalow painting, or anything like that; his accountants had advised that expenses should be spent on a 40:60 percentage.

This is confusing. Why should 40% of our expenses be to run the main house, of which we have no use? Anyway, I got that, but before that, before we got this stage, we paid for advice.., We contacted the advocates

310 Dickinson Cruickshank in their Ramsey office, Mr Watson in particular, and passed over our particular problems and complaints and so we took his legal advice. So we had attempted not only to personally write, either ourselves or Mr Renshaw on our behalf, or the other members of the bungalows, but we had actually

sought legal advice on this particular issue. So we were put to that expense, before I went to see Mr Carman in

December of that year. 315 So, I think, if that answers your question... or not?

Q20. The Chairman: Has the management committee as a whole expressed a willingness to discuss the matter and negotiate?

320 Mrs Williams: No, they have just totally finished with us,

Q21. The Chairman: We have in our records, obviously, a meeting of the bungalow holders with the

management committee, at which I believe Mr Gardner was in attendance.

325 Mrs Williams: Yes, we had them all!

Q22. The Chairman: And how did that meeting go and what was agreed at that meeting?

Mrs Williams: Well, one of our residents, who has now moved, actually brought a friend with him, who 330 he worked for, who was a very good accountant and he challenged that there was no debt and, basically, if

there was a debt, it was not our debt. There was a big change in that meeting then and it was written off, we were told. It would be absorbed

into the accounts.

335 Q23. The Chairman: And that turned out not to happen, though?

Mrs Williams: Well, apparently, allegedly, it has been written off.

340 The Chairman: Okay.

Mrs Young: I have it here in the accounts dated 31st December, 2009 and it says, 'On the maintenance reserve, balance brought forward written off' so that is cancelled from that. There seems to be a surplus for the year, which is then cancelled.

On the maintenance, then, we have a transfer to the revenue account. 345

Q24. The Chairman: So, what you are saying is that, according to the accounts that you have there, the £13,999 has been written off. So, in terms of just moving forward, as that debt has been written off, what are

the concerns you have about moving forward on the same basis?

350 Mrs Williams: The concerns that we have are, after lots and lots of meaningless information that was forwarded to us about this increase that we had to meet in 2009, to pay for everything that we get, then it

came... Well, they said, If you haven't got to pay this £8 a week, we are going to tell you that for the

Warden's services, you're going to pay £3.50 a week, and if you do not pay £3.50, the Warden's services will no longer apply to you.'

355 Now, £3.50 a week does not sound a lot of money, but on top of £34.42 a week, it is a lot of money.

Q25. The Chairman: Is that a service that each household can choose to opt in and opt out of?

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Mrs Williams: Well, you can now, because if you opt in, you pay £3.50 a week. There is only one resident who actually does that, and she was very vulnerable, she had a very sick husband, who has died since, and she opted in to pay E3.50 a week — and I can see why, because she felt vulnerable: she was vulnerable and still is. Her daughter died 12 months before that.

The public rooms: we are charged extra for the use of the public rooms. We are charged £66 a year for those, plus the use of the cleaner to clean those public rooms, which is said, in our deed of covenant, without let or hindrance, we are allowed to use the public rooms.

Now, I am going to pass you over to Mrs Dot Cook because, during all this, we are having things snatched away from us and we are also being denied the title of 'sheltered housing'.

Q26. The Chairman: Bear with me a moment, but can I put it to you that, perhaps you are wanting it both ways, inasmuch as having had the amount written off for being charged for the rooms and the Warden services that was being charged over and above the grass cutting and the other facilities, which i accept that you have had, you are now saying that you still want access to the communal rooms but do not want to pay for them.

Mr Cook: May I add something, please?

The Chairman: Certainly, Mr Cook.

Mr Cook: These communal rooms, which we do not actually use a lot, we were told that we got them, yes. I3ut all these things seem to be, 'Oh, you can have this, you can have that, if you pay.'

We were given all of this information when we first bought the place II years ago, that we got those things. How can you have actually get to that figure, though, of all this £14,000, when if you work out how much for the grass-cutting, the phone, and the actual painting, it does not amount to the sums we pay?

Q27. The Chairman: It does seem that the £14,000 has accumulated because of the amount that has been charged for Warden services, for the cost that has been allocated for the additional rooms, but that has been written off. If you are not being charged for that now, then, you still expect to be able to use these services for nothing.

Mr Cook: We pay over £20,000 a year.

Mrs Cook: Can I say, most of this money. what he has collected, I have got a figure here. In 2008, they collected off us £20,135 and £17,000 just under, was taken out of that in just salaries alone, without entrance to the public rooms. So there is hardly anything left at all. We should not be paying salaries. If you look at the

395 major accounts, which we required; well, we enquired for. In the main block, salaries and wages were £41,782. Of that, we have paid E16,713, but on top of that, our grass cutting has been taken away from it as well, but in the main accounts, it does not say anything about this payment to Mr Collins, who does the grass.

So we have to assume it could be in salaries and wages, because these are the main accounts and on the main accounts for the external decoration in 2008 they are quoting £8,836, but in our accounts it has got

400 £9,623. So these are what I would call the main accounts which would come to your offices. These accounts that we have, the accountant we got, said these are rubbish: they would be chucked out of

court if you went to court with these. So he has seen into it and so all we are doing is paying, really, for the salaries, which we are not obliged to, really, or 40% of something we hardly Me. We look after ourselves, and it is just getting ridiculous.

The Chairman: Mrs MacMullen.

Mrs MacMullen: To summarise, we are paying large sums of money —£16,000 —

Mrs Cook: That was in 2008.

Mrs MacMullen: — in 2008, for salaries... The cost-cutting on our accounts is totally separate. So we are paying for the services of the grass cutter,

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415 but we are also being charged, or we are subsidising, the fees for the Warden, whose services we no longer

have. So we are being charged for something we are not receiving and that is a very basic... Never mind all

the points that Mrs Cook has very rightly pointed out, about the discrepancies in the accounting, which are

confusing to say the least.

Mrs Cook: Could I add something which is my forte: the TV Licensing. When we arrived 11 years ago, 420 the Warden came through and said, 'You can have your TV licence on a concessionary basis now, because

you are in sheltered housing'. When all this erupted a year and half ago, straightaway we have been told we cannot have this concessionary licence.

We got in touch with the TV Licensing, who were very sympathetic and said, 'It was your right.' We

explained what we lived in, but then they had a letter from the Kirk Michael, saying that the Warden had been 425 taken away from us, and maintenance and care had been taken away from us. So the TV Licensing had to

apologise to us and said, 'We are sorry, you should never have had this concession.' So we were all getting...

`Are they going to come on to us for 10 years?', which they did not, but we are either sheltered housing or we

are not. If we were sheltered housing, they said you would get it. They had sent all the forms to the office for

this. They said, 'They only have to fill it in and send it back.' But they have said they have taken management 430

and care as well away from us and they were not going to do it, and they have told the TV Licensing that we

can sell to anybody of any age. I have got the correspondence on this. Now, we know we cannot. But this is how ridiculous it is getting. We now pay £144 for the TV licence, instead of £7.50. So they are

adding on to us... There are about six of us under 75, but how fair is it'?

Q28. The Chairman: What is it that prevents you from selling the house to anyone of any age?

Mrs Cook: Because we are in the sheltered housing and we can only sell to 50 plus. When we bought, the

advocate said you do realise you have got to be 50 plus to live in them.

Q29. The Chairman: That is something that is in the deeds, in the management agreement? Where has

that come from?

Mrs Cook: This is what has been told to us.

Mr Cook: Our solicitors told us.

Mrs Cook: This is the advocate who told us.

Q30. The Chairman: But it is not in the deeds'?

Mrs Williams: Because we are sheltered accommodation.

Mrs Cook: That is what it covers.

Mrs Williams: But now we are being denied that title.

Mrs Cook: All our documents state we are sheltered housing. Now we are being told we are not sheltered

housing. We live in a sheltered housing complex, but we are not regarded as sheltered housing. So, what are

WC paying for?

Q30. The Chairman: Sheltered housing, from the evidence we have from the Attorney General, does not

have a definition in law.

Mrs MacIVJulien: Is there a definition in law, did you say?

The Chairman: No.

Mrs MacMullen: That is our problem.

That was something that I was going to bring up at the end, irrespective of what the outcome of this might

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be. It would be extremely helpful, not only for ourselves us, but there must be dozens of other people in

similar accommodation, yet there is no definition as such.

Q31. The Chairman: It just seems, then, perhaps there is not an impediment on you selling your houses

to —

Mrs Cook: No, we had a reminder sent to us about the caveat, that it had to be treated as sheltered

housing.

The Chairman: So this is a caveat to the deeds?

Mrs Cook: This was in... Where is our caveat?

Mrs MacMullen: In our conveyancing documents. We cannot sell on our property.

Mrs Cook: These documents came to us, to remind us that we lived in sheltered accommodation. From Mr

David Carman as well.

The Chairman: I am sure... do we have a copy?

Mrs Cook: You might have. This was an addition.

The Chairman: Okay.

Mr Teare.

Q32. Mr Teare: First of all, we are starting to talk over each other. The Hansard clerk, I think, is bobbing

up and down. He is getting somewhat perplexed, I have to say! To go back to the point I raised with Mrs Williams about negotiation. As far as you are concerned, to

paraphrase it, there was no attempt to negotiate, it was just a fait accompli. There was no information given to

you to substantiate the request that had been made to you, to increase the maintenance charge?

Mrs. Williams: No, because I have given you the evidence of what we have been told.

Q33. Mr Teare: That is fine. I am just clarifying it. The next thing is, do you feel vulnerable, because in many respects there is no easy avenue to resolve this

505 dispute? And is that the real reason behind your petition, Mrs MacMu Ilen, and your appearance here today?

Mrs MacMullen: Indeed.

Q34. The Chairman: The agreement that you have with Kirk Michael Housing Association, is that an 510 agreement that you still wish to be bound by? Or is that something that, if you could still live in the house you

live in and not have that contract, would you choose to do so?

Mrs. Williams: Yes.

The Chairman: Yes, what?

Mrs Williams: Yes, definitely.

Mrs Cook: We would choose to go on our own.

Mr Cook: We would keep to having the lawns mown. We would have them painted. We would also get

three quotes every time. [Inaudible]

The Chairman: Mr Robertshaw.

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Q35. Mr Robertshaw: There are five houses represented here.

Mrs Williams: We represent eleven.

Q36. Mr Rohertshaw: Could you explain and expand on how you represent the others. Have you met all of you together and discussed this in detail, and that the rest of the occupants are comfortable that you represent their views fully?

Mrs Cook: Yes, we always have a meeting all together. We are just here as five.

Q37, Mr Rohertshaw: So, if I can go on from there, when you say that you would be content to be outside of the agreement, does that represent all of you or some of you? Do you have different views on that'?

Mr Cook: It is the majority.

Q38. Mr Robertshaw: It is the majority. How big is the minority, do you know?

Mrs Williams: One.

Mr Robertshaw: One person. So effectively, one occupant wishes to stay within the maintenance agreement and the rest of you would be content to be outside of it, if that were possible.

Okay, thank you, Mr Chairman,

Q39. The Chairman: Thank you. In terms of a formal dispute resolution procedure, what is the resolution procedure for any conflicts that

arise between you and the housing association?

Mrs MacMullen: Could you repeat that?

Q40. The Chairman: Is there a formal disputes resolution procedure set out anywhere in any of the documents that you have, for any instances where you might disagree with?

Mrs MacMullen: No, there is no such.

Q41. The Chairman: Thank you. I suppose the last key question is: what would you like to see come out of this Select Committee in terms

of any changes that you feel would be necessary to the way that your arrangement... freehold properties interact with management companies? What sort of changes would you be looking for, in an ideal world?

565 Mrs MacMullen: 1 speak entirely for myself on this one. As far as my family is concerned, they like the idea of a Warden service, because I have no family on the Island. For myself, I am quite independent, and I am quite happy to make an arrangement with the other bungalow people to cover this eventuality, because I think I am paying very dearly for this.

But just to make things absolutely certain, when it comes on to should I wish, or should my heirs and 570

successors wish, to sell my property, the caveat that all sales must go... or that they must be advised, Kirk Michael, I would like that no longer, because that is controlling us, something that is controlled.

My family would prefer for me to stay within a Warden service. It is my decision, after all, and I am quite happy to break this arrangement, but for the future, for the sake of people coming after me, I would like Tynwald to make a definition on what is sheltered housing. We are so confused, All our documents —

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documents from the Land Registry, all our documents — first planning, when the first plans were laid in the creation of Carman Court, all declare this to be sheltered housing, but we find it is not there.

So I would be quite happy to scrap the agreement that we have and make our own arrangements.

580 Q42. The Chairman: What sort of things do you believe that sheltered housing should be. What should

sheltered housing —

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Mrs MacMullen: Sheltered housing to me implies the care of a Warden. That to me is almost the very

basic unit of sheltered housing.

Q43. The Chairman: You also said about the removal of the veto, in effect, of the management company

on who you are selling your house to? Is it not something that is quite advantageous to you, to be in a neighbourhood of people of a certain age, so that you do not have people, perhaps, younger people in next door and some of the problems that could, potentially, go with that?

Mrs Cook: Well, what we would like really, we would form our own committee and then we would run it how it should be, but also class it as for elderly people from 50 plus, would live in them, so it would keep that contained for the elderly and that would just be an agreement that would go along with the sale.

We would look after it in the way that it has to be looked after.

Q44. The Chairman: The owners of the bungalows are not represented on the management committee or

the hoard of the housing authority, are you?

Mrs MacMullen: No, we did bring this up — this point that you have just raised. I brought that up in the

very first meeting that we had, on 27th May last year. They said, yes there could be, but in fact that all fell

apart. it never materialised, but I did raise that point.

Q45. The Chairman: Is that an alternative avenue for you?

Mrs Williams: We did actually have a letter withdrawing that, didn't we?

Mrs Cook: Yes, because we will not pay the .C3.50.

The Chairman: Okay. Mr Te are

610 Q46. Mr 'reare: Flow do you feel you have been treated as a result of this experience?

Mrs Williams: Terrible. We all feel terrible.

615 Mrs MacMullen: I think we all feel persecuted, not to put too fine a point on it, because these withdrawals

of services have been gradual, one by one, the car licensing —

Mrs Williams: TV licensing.

620 Mrs Mac — and there are other issues which we have not gone into: it has been a gradual process.

There is no means... I think what has made me so frustrated, extremely anxious, very worried, has been

the fact that I cannot make contact with anybody who will look at our problems and give us direct and honest answers. That has been the frustration. The anxiety has been that it is all preying on our minds. We are all in

indifferent health, but I feel it is amounting to per.... and I cannot understand how an organisation can call 625

itself an organisation which cares for elderly people and this purports to be concerned about our welfare, can have shown a very distinct lack of caring interest over these last... well, since May of last year.

Mrs Williams: The duty of care has been removed.

630 Mr Cook: I also believe that the Wardens... and the role for us is that she would open the door if we had an emergency 999 call, to the emergency services and that is it. Well, there is not much care there with that, anyway. But I believe that is what the Wardens were told, that that was their job.

The Warden is not allowed to come to us for anything. She has been told, you do not go to the bungalows until we have pressed our emergency.... if we feel there is an emergency, and she will only do it if we have

635 the three emergency services. Well, we do not always need that. Somebody can be very ill in bed and just want a call from a doctor. But she will only attend to us then: she will come to the bottom of the drive, give the key for them to get in and then she will go away. If your curtains are shut all day, she is not allowed to

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come and check you out to see if you are okay. Now, this has just been taken away from us. Before there was care. She would take note, if you were ill in

bed with a bad cold, she would make notes of it, then she would make notes if you were alright... just a general care. But that does not exist, so we might as well not even really belong to it. Even with the snow, we had to start clearing it up because we were all scared of slipping.

Mrs Williams: And then on the Thursday... We had the snow on the Friday and more on the Monday, but on the Thursday, because my next door neighbour, Mrs Critchly, went over to the Warden and played the band about the drives being so lethal: then she must have got in touch with the committee, and there were about six young people coming round scattering salt and grit. But it was a little too late.

Q47. Mr Robertshaw: Many of you were very kind and submitted comment to us in writing, which we appreciate very much. In one of them — and perhaps you can guide me here — one houseowner seemed to indicate that their medical records were held in the main block. Did I misunderstand that, or...?

Mrs Williams: Yes, if you are on drugs, or...

Mrs Cook: They wanted a list of the drugs that you were on.

Q48. Mr Robertshaw: Who did?

Mrs Cook: The Warden.

Mrs Williams: The previous Warden and she used to update it every year.

Q49. Mr Robertshaw: You were asked for the drugs you were on by the Warden, all of you?

Mrs Williams: Yes.

Mrs Young: No.

Mrs Williams: You are not a resident, actually, are you'?

Q50. Mr Robertshaw: What other sort of information of that ilk were you asked for?

Mrs Cook: Relatives.

Mrs Williams: Relatives' numbers, which I could understand, and doctors.

Q51. Mr Robertshaw: And that was kept up to date until how recently?

Mrs Williams: We have filled nothing in, since the new Warden took over.

Q52. Mr Robertshaw: But prior to that, quite regularly. That sort of information.

Mrs Williams: Every year and I used to write along the bottom, `no change'.

Mr Robertshaw: Thank you.

The Chairman: Well, before we bring proceedings to a close, Mr King.

Q53. The Clerk: Thanks, Mr Chairman. 690 Could I just go back briefly to the beginning, to when you each purchased your properties. I think it has

come out of the discussion already that, in the written maintenance agreement between yourself and the community housing association, it makes provision for exterior painting and mowing, but it does not mention

Warden services. Have I got that right?

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Mrs MacMullen: You have,

Mrs Williams: Only inasmuch as if you have [Inaudible] the care phone, then the Warden, in an

emergency, should come over and open your property.

Q54. The Clerk: Right. It has also come out from the discussion that you see the provision of a Warden service as a fundamental element of sheltered accommodation, and that you thought you were buying

sheltered accommodation. Did you, Or did your advocate, query the lack of detail on Warden services in this agreement?

Mrs MacMullen: Mr Renshaw — if he is not allowed to speak — was the original purchaser of the very first

property and his advocate, Corlett Bolton, strangely enough, who happen to be advocates to the Kirk Michael

Housing Association, actually answered his queries in detail as to what he understood — making this purchase

of the bungalow — was sheltered housing and it is specifically stated 'sheltered housing'. Mr Renshaw had

that, but the rest of us did not. I did not. When we had this first meeting with Kirk Michael Housing Association on 27th May, I mentioned that

and asked the advocate who was present at that meeting, if, in fact, this had been a failure on the part of my

conveyancing advocates that the detail was not there. Her reply was, of course not, to which I replied, you would say that because you are an advocate, but I did ask that question: was my conveyancing advocate in

default by not going into the detail.

Q55. The Clerk: If you buy sheltered accommodation, and you think you...

Let us try to depersonalise it a bit. Do you think that if somebody goes to buy sheltered accommodation and to buy a warden service, it is not at least partly the responsibility of the purchaser to see what it says in

black and white about the warden services that he or she is trying to buy?

Mrs MacMullen: Certainly, I accept your point of view on that. It was not written down. It is not written,

but it is in practice. It has been in practice, but there is no written definition as such.

Mrs Williams: Neither is it written that we foot the bill for a huge percentage of the salaries of the staff of

Cannan Court. Also, in 2004, when I bought my property, I was a widow, retiring and looking at quite a small budget. I

wanted my advocate in the UK solicitor to thoroughly look at this document. My son was in contact with

an advocate on the Isle of Man and he did the same for me this end, and both of those advocates, solicitors,

whatever you want to call them, said that the document seemed sound. So I went ahead.

Mrs MacMullen: Perhaps, Mr King, our failure to have this particularly defined as warden services was

rather masked by the fact that all the conveyancing documents spoke of sheltered housing, which brings Me

back to the question that you asked, and that I said what I would like to come out of this was a definition of

sheltered housing, because that seems to be something that it is in the hands of the Keys, perhaps at least to do

that — to get a legal definition on sheltered housing.

Q56. The Clerk: It seems to me that you are looking for more than a definition. This is not just an

exercise in —

Mrs MacMullen: I am. But that is almost, it' you like, the pivot point of our dispute, because we find

ourselves in sheltered housing that is not sheltered housing.

The Chairman: Sorry, we are going to start talking over each other again.

Mr King.

Q57. The Clerk: Sorry. It seems to me it is not just an exercise in writing a dictionary definition, what

you are saying... well, are you saying that if someone purports to sell sheltered accommodation, there should

be certain features which must be included. You talk about regulating a sector of the economy.

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Mrs MacMullen: Yes, exactly, precisely. Thank you.

Mr Cook: One thing I would like to clear up. I know it has been partly cleared, but with the TV licensing

for ten years we were classed as sheltered housing by the housing committee. Then suddenly, we don't agree

to pay and we are suddenly not sheltered housing — and that is in writing to the TV Licensing.

The Clerk: When you say the...

Mr Cook: We are not sheltered housing, according to the committee, yet for ten years they have been claiming it for us.

The Clerk: This is the management committee of...? Yes.

Q58. Mr Robertshaw: Just to follow on Mr King's questioning, really, you clearly want a definition of

the words 'sheltered housing'. Would it not be true also to say that you would wish to see guidance as to how the owners in sheltered housing related to that sheltered housing administration and management? Would that

not be a fair point?

Let me put it to you again —

Mrs MacMullen: I am sorry, Mr Robertshaw, but I cannot hear you.

Mr Robertshaw: I beg your pardon. I will ask the question again. Clearly, you will be looking for

definition of what sheltered housing is; would you also be looking for how the relationship between the owners of sheltered housing related to the management of it, in a proper sense, so that you were involved

much more clearly in that sheltered housing administration?

Mrs MacMullen: I think that would be a difficult one, because that would depend on the ability and

interests of the people going into that. I do not know that that would... I am probably misunderstanding you

on this point.

Mr Rohertshaw: Well, it is the degree of representation and engagement in it, in the administration of the

services provided.

Mrs MacMullen: I think that would be helpful.

Mr Robertshaw: Am I putting words into your mouth a bit?

Mrs MacMullen: If you can find somebody... (Inaudible] prepared to take on committee responsibility on

this.

Mrs Williams: Can I just come in there? If we are no longer sheltered housing, which we have been denied on several occasions that, because we

are owner occupiers, freehold, we are in a sheltered housing complex, but individually we are not classed as

sheltered housing. So why do we foot the bill for three years of £5,369.52: that is the 2010 figures of what we

pay every three years?

Q59. The Chairman: Have you received a definition of what is sheltered housing from the TV licensing

people?

Mrs Williams: They are just being told that we are not sheltered housing.

Mrs Cook: Yes, but we did have a letter.

The Chairman: Did they define why you should or should not he?

Mrs Cook: Yes, I have got a letter here from the TV Licensing to us:

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'It has been brought to our attention by Kirk Michael Housing Association that they are no longer responsible for the management

and provision or care of the Carman Court bungalows. In light of the above information, it is regretted that your accommodation no longer qualifies for the concessionary TV licence, and you will be required to obtain the relevant full licence. I am sorry I am unable to give you a favourable reply.'

Q60. The Chairman: So, in other words, you do not have a Warden, therefore you do not qualify any more.

Mrs Cook: But, if we had paid the £3.50, all those things kicked back in. Now, that cannot seem right. If we pay a little bit more, then we would get the TV licence, because then

we would be being covered by the Warden, where the two objects do not go together. (The Chairman: Why?) Because we arc either in sheltered housing or we are not. If we pay £3.50 on top of what we pay now, we go back into sheltered housing with the Warden; whereas we have bought it as sheltered housing. So we are giving it, taking it away, and then we will give it back if you pay us £3.50 a week more.'

Q61. The Chairman: Mr Robertshaw? Mr Teare'? Mr King? Before I wrap this session up, is there anything else that anybody on your side would like to add? By way

of a closing statement or any further points that you feel we have not explored?

Mrs Williams: There was something. Some months ago, there was suddenly a notice put up at the bottom of the road at Cannon Court banning dogs. Not an antifouling notice, but clogs not allowed with a fee, a fine. Any of us, who live in these bungalows is capable and allowed to keep a clog, It is in our deeds, household pets are allowed. If we have, with the way it was then, if we had visitors bringing a dog to our premises, that

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was against the law, so called, which the Commissioners had done at Mr Cannan's request to ban dogs in the whole of Cannon Court.

Mr Parkinson, who has since moved from our complex, had many letters backwards and forwards, because he had a daughter who used to bring two dogs and he said it got to the point where they cannot even get them out of the car. We could be fined for this.

835 My next door neighbour has a dog, but David Cannon wrote her a concessionary letter, I mean, how pompous is that? Anyway they have changed the notices now.

Mrs Cook?

Mrs Cook: Yes, we waited a year for it.

Mrs Williams: We waited over a year and what does it say now?

Mrs Cook: Except for the bungalow owners. No clogs allowed, except for the bungalow owners. So, it has gone back the other way.

Q62. The Chairman: And that is a sign erected by the Commissioners?

Mrs Cook: Yes, because we got on to the Commissioners.

Mrs Williams: And that is where it was stated to Mr Parkinson, in a letter that I have not brought with me, that as it was a sheltered housing complex, each individual dwelling was not — because it was freehold owned — sheltered housing, which is what has brought us here today and on Tynwald Day.

Q63. The Chairman: Thank you. Mrs Young?

Mrs Young: Weil, I just wish we could all talk — sit down and talk as adults. We should speak to each other. It is no good passing the buck to other people. It needs to be resolved. It has caused a lot of unpleasantness, really, and people seem to take things personally. But when you are on your own, who else...? You trust what people do, and it is very difficult.

The Chairman: Thank you.

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Mr Cook: No, there is nothing else.

Mrs Cook: No, fine, thank you.

Q64. The Chairman: Mrs MacMullen it is only fair that I should leave the last word with you.

Mrs MacMullen: No, 1 think I have spoken quite enough. Mr King actually put very succinctly into what I was looking for, with regard to sheltered housing — the definition for our housing, what sheltered housing is, and a realignment of the whole thing, so that there is clarity, we know where we stand, we know where our money is going, what we are paying for. Just that.

Mrs Williams: And they cannot come along and whack another ..£8 a week onto our maintenance charges.

The Chairman: Ladies and gentleman, thank you very much for coming in and giving evidence today. The Committee will now sit in private. Thank you.

The Petitioners; Thank you very much.

The Committee sat in private at 4.07 p.m.

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EARLY PUBLICATION (1.00 p.m., 7th February, 2011)

PROCEEDINGS OF THE SELECT COMMITTEE OF TYNWALD

ON SERVICE CHARGES AND FREEHOLD PROPERTY

(PETITION FOR REDRESS OF GRIEVANCE)

EPTSCFP260111

Douglas, Wednesday, 26th January 2011

Morning Session: 10.00 a.m. — 11.33 a.m.

The Committee sat in public at 10.00 a.m. in the Legislative Council Chamber,

Legislative Buildings, Douglas

/MR WA7TERSON in the Chair]

Procedural

The Chairman (Mr Watterson): Good morning everybody and may I welcome you to this sitting of the Select Committee of Tynwald on Service Charges and Freehold Property, a Petition for Redress of Grievance. My name is Juan Watterson MHK and I am Chairman of this Committee. The other members of the Committee are Mr Eddie Teare MHK and Mr Chris Robertshaw MHK: our Clerk is Jonathan King and our Hansard reporter is Clive Alford.

Can I please ask at this stage that you switch of your mobile phones and I need to ask they are switched off not just on silent mode, because they will interfere with the recording equipment. When you are called on to speak, can I ask you to speak up and start by stating, for the benefit of Hansard, your name and the capacity in which you are speaking.

This Committee was established by resolution of Tynwald on 20th October 20 (0, that a select committee of three members be appointed with powers to take written and oral evidence, pursuant to sections 3 and 4 of the Tynwald Proceedings Act 1876, as amended, to consider the Petition for Redress of Grievance of Mrs Marjorie MacMullen and others presented at St John's on 5th July 2010 in relation to reform of the law relating to service charges, with specific reference to freehold property. The Prayer of the Petition reads:

`Wherefore your petitioner seeks that Tynwald Court appoints a select committee to examine reform of the law relating to service

charges, with specific reference to freehold property.'

We heard from the petitioners on 13th December 2010 and today we hear from the Kirk Michael

Published by C the High Court of Tynwald, 2011

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SELECT COMMITTEE, MONDAY, 26th JANUARY 20I0

Community Housing Association. As a Committee, we cannot take a view on any individual case. The petitioners have recognised this in their Prayer, which asks us, not to adjudicate in the dispute between them and Cannan Court, but to examine reform of the law. That said, in order to make any wider recommendations, we do need to fully understand the circumstances that led to the Petition.

We welcome this morning the Chairman of the Kirk Michael Community Housing Association, Mr David Cannon MHK.

Good morning, Mr Cannon.

Mr Cannan: Good morning to you.

Statement of Mr D Cannan

Q65. The Chairman: Would you care to make an opening statement, please?

Mr Cannan: Yes. First of all, I would like to draw to the attention of the Committee that one of the petitioners, Mrs June Young, has in the meantime sold her property.

The Chairman: Yes, we are aware of that.

Mr Cannan: So the Housing Association feel that there is no justification... that she can no longer be aggrieved or have a grievance.

We would point out that the purchasers of Mrs Young's property — and this is very relevant — Mr and Mrs Lague... Mrs Clague contacted me in the last two to three weeks, on two occasions, to double check on the

45 conditions. It was clearly explained to her that the service agreement... the Community Housing Association abided strictly by the terms of the agreement and that, if she and her husband wished any extra services to he provided by the Warden, there was a current charge of £3.50 per week. Mrs Clague said that she was quite satisfied and if she wished extra services to be provided by the Warden, she would be very happy to pay, and I believe — on that understanding — she has, of her own volition, bought the property.

50 That, then, is an indication, we believe, in the Association, of what all this problem is about: for services previously provided free by the Warden, the Association introduced a charge of £3.50 a week, and if you want it you pay for it, as one household... does, with a very elderly lady who needs it, and the others have declined to pay.

As you are aware, the land on which these bungalows were built was sold to Parkinson LW, freehold and 55 unencumbered. Later on, Parkinsons approached the KMCHA and asked would they be willing to provide a

service agreement if they attached it to the sale. So, in other words, we were not involved in the sale of these bungalows whatsoever. The sale was between Parkinson Ltd and the purchasers, and Parkinsons drew up a service agreement which, obviously, we agreed to. Otherwise, we had no involvement. The only involvement we have is when the sale is complete and the lawyer writes to us and asks us to countersign the service

60 agreement, which the purchaser has already signed in the presence of their lawyer. So, as you will see, in the case of Mr and Mrs Clague, who have bought Mr and Mrs Young's bungalow, there is no coercion whatsoever by the Community Housing Association. People buy their bungalows of their own volition. We are not involved, and we know nothing of them. We only eventually hear who has bought a bunglaow when the lawyers contact us.

65 As I say, the Community Housing Association agreed with the terms of the agreement. The Housing Association considers the agreement to be a civil and legal contract — nothing to do with sheltered housing, as we will show. In the case of Mrs Young, she never lived there: first of all, tried to rent it out, then went on to put it up for sale, and she now has a sale. Two of the purchasers of the bungalows were in full time employment. They were not elderly or anything to do with sheltered housing. They bought the houses, we

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believe, because they were below market value, in the sense that they were value for money at the time they were constructed.

From the beginning, all went well and the KMCHA, because they had achieved to build an apartment block that is truly sheltered, in the sense that the apartments are rented out, there is a full time warden, etc, through reasons of altruism, felt that they would provide these extra services through goodwill.

75 The days of goodwill came to an end, when we felt that we had to impose a charge — not an onerous

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charge; 50 pence a day. You would not even get a home help for one hour for £3.50, and yet they were getting a warden calling daily and dealing with other matters, such as, in certain cases, watering their pot plants while they were on holiday, forwarding their mail, and doing all these extra services, which were being taken advantage of and, in one or two cases, the Warden reported that she was in receipt of unfriendly language.

80 So we decided that, in the circumstances, we would adhere strictly to the terms of the agreement. I think, in the Petition, you will see that it says there is no redress of law but, of course, there is a law, because it is a civl contract, freely entered into by both parties. We truly believe that we abide by what that actually says. The argument is that we have withdrawn services previously provided free and imposed a charge of £3.50 per week, 50p a day, if they wish it.

85 As I have said earlier in the evidence, for the purposes of no. 25, [Inaudible] ...accepted it and said when we need it, we will buy it. You cannot service at that current charge, and one household, having completed it, were only too pleased to have it, to save them, perhaps, from going into a nursing home with all sorts of things... [Inaudible] three times a day... I am giving them a fair... and it is nothing to do with sheltered housing: the houses are nothing to do with sheltered housing, they are freehold and it is a civil contract by

90 Parkinsons, which we adhere to. There are two flaws in the contract. One was that we agreed the rate, set at £25 a week, was too low; and,

secondly, that it was going to be increased by the rate of inflation published by the Treasury — but as you know, the rate of inflation published by the Treasury is an average rate of inflation. So some things are more expensive and some things are less expensive. To give you an example, in the apartment block because we

95 had, when the apartments were all built, a housing officer from Government come and assess the initial rent and the rents have been increased annually in accordance with the Government's sheltered housing rent, so there is no dispute. The staff are paid on Whitley Council rates, so there is no dispute on those: the dispute is not with us, it is the Government rate setting and the rate of inflation for the year before last — we are in 2010 now — was 0.6%, an 18p increase on what they were paying.

100 The rents in the apartment block went up 5%... (Inaudible] and are going up again 5%. I digress again, but I am just giving you an example.

So we felt it was too late. There was, in that service agreement, no flexibility to cope with reality and the rate of inflation, because the rate of inflation, in reality — as we are all now suffering at this present time with the rate of inflation, sir.

105 So that is the basis of what we have to say. They were bungalows built by somebody else, and which we had no party to. The land was sold free and unencumbered. They asked us to provide a service agreement and we did, bearing no relation to sheltered housing as seven of the purchasers were in full-time employment. One of the original people who have a general grievance... has returned to the UK to full-time employment. This

1 10 agreement is nothing to do with us. They buy and sell their houses as they wish and we found that... [Inaudible] the service charge was not enough to cover our costs and called a meeting, tendered in May 2009. [Inaudible] ...residents there. We had our lawyer and our accountant. We explained to them. It was quite a torrid meeting. We had run-up a deficit on the bungalow maintenance account... [Inaudible] Everything is now running smoothly. They are paying the original charges and if you want the extra surplus service, you get the surplus service and nobody can chit £3.50 or 50 pence a day. It is exorbitant for what they would get.

115 So I think, in summary, as I have already said, the maintenance would be a civil and legal matter. It has the Association adhered strictly to the terms of agreement — it is a civil contract, so there is a remedy of law if anybody wished to... I think the proof of the pudding is that people have, since this difference of opinion... there has actually been a sale of a bungalow and the purchasers are quite happy with the present arrangements.

120 1 recollect that the Housing Association has another civil contract... also... a contract previously with the DHSS and now the DHA

The Chairman: DHA?

125 Mr Carman: Sorry, DoH. I beg your pardon. DoH. It is only the initials — the Department of Health — to provide a minimal doctor's surgery in Kirk Michael— what was originally agreed — pending the construction of a proper surgery. That was cancelled, for reasons that the Hon. Members know, so this temporary arrangement carries on, but it is purely a civil... It is not a... it is a civil contract, in the sense that we have that.

130 I think that is the case.

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EVIDENCE OF MR D CANNAN

Q66. The Chairman: Thank you very much. You have set out the land pretty well, but if I could just get clarity on some specific points.

You say that the bungalows were sold to Parkinsons on a freehold basis?

Mr Cannan: That is correct. You have a copy of the agreement.

Q67. The Chairman: It was not a condition of the sale that they provide sheltered housing with that.

Mr Cannan: You have seen the deeds, sir.

Q68. The Chairman: I know what the paperwork says; f am wondering whether there is any other gentleman's agreement or understanding that perhaps was not reflected in that.

Mr Cannon: No, they were going to construct bungalows.

Q69. The Chairman: So it was not a condition that they would be sheltered housing?

Mr Canaan: No, there was no condition, no.

Q70. The Chairman: Obviously, that is in the deeds and you have drawn out the difference between what you see as their housing not being sheltered housing, compared with the accommodation that is provided in the block, which is sheltered housing. How would you define sheltered housing?

Mr Cannon: Sheltered housing, as defined, they are apartments that are rented and where the proprietor, the landlord, determines who should rent the apartment, just exactly the same as Government.

Q71. The Chairman: So, you would say the fact that they are apartments is a requirement for it to be sheltered housing?

Mr Cannon: And that is in law, too, sir, because we, misguidedly, in our goodwill originally, included the bungalows in the provision of television licences for sheltered housing, but the television authorities informed us that freehold housing is not sheltered housing and is not part of the overall —

Q72. The Chairman: So you are talking about the Television Licensing Authority's definition, rather than it being in Manx law about a definition of sheltered housing?

Mr Cannon: Well, the definition of the UK is that private houses cannot be sheltered housing.

The Chairman: Okay —

Mr Cannan: And that is my conception, too. How can a private house be sheltered housing?

Q73. The Chairman: And also you state that a key part of the definition of sheltered houses is the ability to allocate those houses.

Mr Cannon: Absolutely.

The Chairman: I am just trying to clarify —

Mr Cannon: We would not allocate an apartment to a working couple to be allocated on a need basis, but that is a different issue.

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Q74. The Chairman: Whilst that is a fair point, what that does do is... As you say, it does not allow someone to have a freehold property that is sheltered, and I think of St Ninian's and there are other examples

190 of freeholds that might be considered 'sheltered'. I am just looking to try and work

Mr Cannon: But these are private bungalows of which we have no control over whatsoever.

The Chairman: Okay. Mr Teare.

Q75. Mr Teare: There seems to be a contradiction, here, Mr Carman, because if I could just basically draw out, or flesh out, our understanding, what you are saying is that the bungalows are not sheltered accommodation. They fall outside the definition, in your mind, of sheltered accommodation. Is that correct, sir?

Mr Cannon: They are not sheltered housing, as far as the Kirk Michael Community Housing Association is concerned, because the Kirk Michael Community Housing Association has no control whatsoever over their construction. They are bought and sold

The Chairman: We arc not necessarily talking, I do not think, about Kirk Michael Community Housing's involvement; it is whether it is sheltered housing or is not sheltered housing, irrespective of the contractual relationship between the two.

Mr Cannon: It was not sheltered housing.

Q76. Mr Teare: So the short answer to that, therefore, is no. Right, well —

Mr Cannon: It is a contractual... Sorry to interpose. It is, as I say, a purely civil contract.

215 Q77. Mr Teare: Okay. No is the answer, then. In that case, then, why, on 8th November 2002, was a caveat filed in the Land Registry referring to the bungalows as sheltered accommodation?

Mr Cannon: In what year, sir?

Mr Teare: On 8th November 2002.

Mr Canaan: Who was this caveat filed by?

Mr Teare: It was filed by your lawyers, acting on behalf of the Kirk Michael sheltered housing.

Mr Cannon: I cannot account for that, because it is not sheltered housing.

Q78. Mr Teare: Would you agree, then, that that should be lifted in the light of the evidence today?

Mr Cannon: Yes, absolutely.

Mr Teare: Our Clerk will just refresh your memory.

A document was produced for examination by Mr Cannon.

Mr Canaan: I believe that, as a restricted covenant, it explains... You will see that it is restricted to a private dwelling house, and sheltered accommodation or elderly persons' accommodation in the development of Carman Court would be conducive to the development of the estate as 'sheltered accommodation'.

Q79. Mr Teare: I the light of that, sir, having refreshed your memory, would you like to reconsider your original statement, that they are not sheltered housing?

Mr Cannon: No, think this was... As I understand it, they are private houses, therefore they cannot be

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sheltered housing, because we have no control over them.

Q80. Mr Teare: But arguing that again, it does use the expression, does it not, that it is sheltered accommodation?

Mr Carman: The expression 'sheltered accommodation' has been used when it should have been 'elderly persons' accommodation'.

Q81, Mr Teare: Well, in that case, then, has that caveat been filed in error? Is that what you are telling the Committee?

Mr Calmat!: It can obviously be reversed.

Mr Teare: So, yes, it has been filed in error?

Mr Cannan: It has been filed by mistake...

Mr Teare: In error. Right. Thank you.

Q82. The Chairman: Okay. Thank you very much. Again, whilst you said that Kirk Michael Community Housing Association has no residual interest in the

land that was sold unencumbered to Parkinsons, at about the same time, just for clarity, there was also a Government grant and I think this might relate to your agreement with the Department of Health, more so than this, but there was no element of that Government grant that was in respect of either the land or the building of the bungalows?

Mr Cannon: None whatsoever, sir.

The Chairman: Okay, thank you very much.

Mr Cannon: On page 29 of the Government grant it says 'save and except the land sold to Parkinsons'. Would you like to see that?

The Chairman: No, that is fine, I just wanted to confirm. I just wanted to clarify my understanding. I just wanted to confirm that.

Mr Carman: ...have been entirely accommodating... [Inaudible] and that has been acknowledged by the Government.

Q83. The Chairman: We have discussed a bit about the caveat. Clearly, despite the fact that that caveat was placed in 2002 by Kirk Michael Community Housing Association, which you say results from a misunderstanding, that caveat then does provide an interest of sorts on the owners of the properties to ensure that they are either seeking sheltered housing or elderly persons' accommodation.

Mr Cannan: Not really. We have no say in who they sell their houses to.

Q84. The Chairman: But it is a restrictive covenant. You have that interest in the restrictive covenant, don't you?

Mr Cannon: We have never exercised any concern as to whom the houses are sold to —

The Chairman: So whilst there is —

Mr Cannan: Sorry to interrupt. — so there have been working people in full-time employment...

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Q85. The Chairman: The caveat gives you certain rights, though, doesn't it, but you are saying that, since 2002, those rights have never been enforced by the Housing Association board.

Okay. Can we move on, then, to the maintenance agreement and how this came about. What prompted it? This was Parkinsons felt that they wanted a relationship between the bungalows —

Mr Canaan: She wanted to sell the bungalows with the relationship.

Q86. The Chairman: Quite. Why, then, was that maintenance agreement not included in the conveyance of the properties?

Mr Cannan: I have no idea. This was all done privately, through their lawyers.

Q87. The Chairman: But it must have had a certain amount of input by the Community Housing —

Mr Cannon: 4o, we said that we did not wish to be... They wanted to sell their property, with the addendum that there would be this service agreement. They drew up the service agreement, sent it to our lawyers for consultation. It is all done by the vendor.

The vendor then was Parkinson.

Q88. The Chairman: So, basically, Park inson's prepared a model contract, if you like, that you agreed to be a party to, and that is then down to each individual property buyer as to whether they wish to sign up for that.

Mr Canaan: As I understand it, yes.

The Chairman: Well —

Mr Cannan: Well, yes it is, because if they want to buy the property, that goes with it —

The Chairman: Well, it is not —

Mr Canaan: That was the original... when Parkinsons sold the property.

Q89. The Chairman: But it is not a requirement of people moving into the properties that they have to take up this agreement?

Mr Canaan: I think it is. If you read the agreement, yes, they are obliged to.

Q90. The Chairman: Flow are they obliged to sign up, because it is not actually referred to directly in the 340 deeds of the property, so what requirement is there for them to sign up to the maintenance agreement?

Mr Carman: I am not a lawyer. Every time there has been a house sale, the lawyer has sent the agreement to the person for signature. We are not involved. I cannot emphasise too strongly.

345 Q91. The Chairman: But if they did not send you a copy of that agreement, you would not... it would not matter?

Mr Canaan: It has not occurred, so we have not...

350 Q92. The Chairman: No. I am just trying to tease out the difference between, say, custom and practice and the contractual commitments.

Mr Cannon: Well, I am not the lawyer for contractual commitments, but there may be in the sale of houses — and we have not got a copy of the deeds for sale of houses, of individual houses — I do recall being

355 told, but I have not got a copy of each individual sale. Maybe there is something in there they require.

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Q93. The Chairman: But would it give you some form of cause for concern if somebody moved into those bungalows and did not sign up to the maintenance agreement?

Mr Cannon: I think the lawyer, it would be a cause of concern to the lawyer if, as I suspect, there is a clause in the sale of the houses, but we have not got it.

Q94. The Chairman: Okay. As I say, our understanding so far is that there is no such clause that requires entry into the maintenance agreement, so I was looking to test that with you.

Mr Cannon: We see the house contracts, so each time the house is exchanged, bought and sold, the lawyer sends us a copy of the agreement, signed by the purchaser.

Q95. The Chairman: Okay, and that is something that you have never sought to include in the conveyance of the properties, because you have presumed it is there?

Mr Cannon: We are not involved in the conveyancing of the property, Chairman.

Q96. The Chairman: But you do have this presumption, though, that everybody who moves into the property will automatically sign the maintenance agreement.

Mr Canaan: We presume so, yes, but we have not called for the conveyance to... We have never had cause to.

The Chairman: But you would be —

Mr Cannon: Parkinsons assured us that it would be in the conveyance... without checking other people's conveyance.

The Chairman: Mr Teare.

Q97. Mr Teare: On the back of that, the corollary to my mind would be that you and your colleagues would not have any difficulty at all if the freeholders, in effect, stepped aside, rather than the services provided by the Kirk Michael Housing Association, including the maintenance, and set up their own arrangement for it, and took it away from you. Would that be acceptable to you?

Mr Canaan: It would be acceptable, in the sense that we would call a meeting of all the bungalow people and explain to them that, if they wished to withdraw from the agreement in Coto, it would be completely in two. Then there may be concerns expressed by other bungalow residents who wish to have the agreement, that they had the agreement on the understanding that all the properties would be maintained to a standard, or the garden maintained to a standard, etc.

We would seek their views as well, but we have not made a definitive decision, but we have basically said yes, subject to those who have signed the agreement, in the knowledge that everybody else has signed it, and therefore the gardens are maintained, the property is decorated, etc. So it maintains the standard of the community.

Q98. The Chairman: But according to the evidence that you have given, the agreement is a private contractor agreement between a householder — not the bungalows en bloc, but a householder — and the Kirk Michael Housing Association.

Given that it is essentially just a contract, by mutual agreement that contract can be ended. If it was the wish of a bungalow holder, it would then be a case of whether the Housing Association would be willing to —

Mr Canaan: In all probability, but it is a question of how do you put the question? It could be a question that could be addressed. but, following this inquiry into a report, the committee will be addressing it. That I think you can be assured of.

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Q99, The Chairman: When you say 'addressing it', what do you mean?

415 contacted and given the option. Mr Cannon: Addressing the indication that the option will be given. All bungalow owners will be

The Chairman: Right, okay. Mr Teare,

420 Q100. Mr Teare: Thank you very much. Mr Cannon, I really think that we should not take our eye away from the fact that you have done very well

with this. To establish it, to raise the financing and to get it up and running, I have to say, is a credit to you. You and your colleagues have done very well.

Could you give me a bit of background information, please? How was this financed at the beginning? I 425 know that there was Government funding and, in addition to that Government funding, there were nomination

rights in respect of the main block, but could you give us a bit more depth into how it was actually funded and put together?

Mr Cannon: Yes. There was a need for sheltered housing in Kirk Michael of some sort and the 430 Department then — we are going back over 20 years — considered that about seven or eight units was sufficient

and that they would probably buy a couple of houses and knock them together and perhaps separate the units somehow. It was all airy-fairy.

I decided, in consultation with others, that this was not what the community wanted: the community wanted proper sheltered housing accommodation. The only way we could do that was by having negotiations

435 -- or talks, not negotiations at this stage — with the then Minister, that if I formed a charity and was able to raise the funds, would they contribute what they had set aside for some sort of sheltered housing. So a committee was formed and we set about raising funds and called for public subscription, and we realised... our ambitions were that we were required to raise £1 million and our overall cost was estimated at £1.7 million.

440 So, to cut the story short, we had... [Includible] fund raising and the whole community gave according to their means. Some benefactors, whom I might class as 'millionaires', gave very substantial sums, each according to... Some gave £5,000, some gave £1,000, some gave £500, some gave £250 — throughout the village. It was a community housing association and in order to get... when we had raised £600,000, in order to show progress on the ground we went to the bank and asked for a loan of £300,000, because only when we

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could have a document showing that we had the ft million — I know six and three do not add up, but then you add... — (The Chairman: Yes.) would the Government agree to the grant of £700,000.

We showed that we had it — this was 1996-97 — and the then Minister went to Tynwald and said that the allocation for Kirk Michael was £700,000 — it was a bit more, but you know what I mean — and they had documents to show that we had cash in the bank — six hunched and something — and that the bank was going

450 to give us £300,000 and they were fully satisfied. As I say, with some very generous donations, we formed the Kirk Michael Community Housing

Association. Most of the meetings were... [Inaudible] information. Some of the meetings were... round the table, if you like, when we engaged architects who, because we were a charity and we were not a Government contract, did not charge the fees that they would charge for a Government contract,

455 As a politician, I know what I am talking about. We did everything ourselves. We engaged architects, surveyors, quantity surveyors, civil engineers. We did the whole thing. We progressed at each stage, and when we got to the stage when we were ready to sign the contract, we called on the Department of Local Government and they were satisfied we had done everything required, it was subsequently approved by Tynwald and then we signed the building contract.

460 Since the building was officially opened in December 1998 — in the next 10 years — we have cleared the mortgage through public subscriptions and fund-raising activities and it now... the property is free and unencumbered. Of the 18 units or apartments, the Government has nomination rights of eight. Ten are in the Community Housing Association because that was the proportion of the money provided.

465 Q101. Mr Teare: You said you had some foreign benefactors. Could you name the two top benefactors?

Mr Cannon: I do not think that is appropriate, sir.

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Mr Teare: Why not?

Mr Carman: Why should the two top benefactors be singled out?

Mr Teare: Well —

Mr Canaan: Mr Chairman, I appeal to you. Should you name, publicly, the benefactors? Well, I am quite happy to name... Well, why pick two? Why not three? Why not four?

The Chairman: If you want to tell us four, I do not mind. (Laughter)

Mr Canaan: Why should I tell anybody? These are benefactors.

The Chairman: Mr Teare, I presume you are just trying to find out more background on the financial arrangements for the Association?

Q102. Mr Teare: You have always been very successful to get to the stage where you are today. A bit of background information would give us the whole picture.

Mr Canaan: The building was opened by Mr and Mrs William Showell, of the Showell Foundation of America, and the major contributors have been the Lottery Trust, the White House estate, the previous owner of Bishopscourt... I can go on, there are people who paid £100 and so on.

Q103. Mr Teare: I take it that the previous owner of Bishopscourt means Mr Ferguson Lacey?

Mr Cannan: Mr Ferguson Lacey made a contribution and the previous owner, Mr Lomas, also made a contribution.

Q104. Mr Teare: Okay, thank you very much. What was the basis of the proportionment of the costs? You said there arc 18 apartments, there are 12

houses, so in terms of —

Mr Canaan: Twelve houses? It is nothing to do with 12 houses.

Mr Teare: Well, could you just set out the basis of the apportionment of costs?

Mr Canaan: The construction costs?

QI05. Mr Teare: No, sorry. The maintenance costs going forward. What you said is that there is a maintenance charge, so how was that calculated'? How was that set up?

Mr Canaan: The calculation was there are 18 units and 12 bungalows. The services are provided universally. So the cost of the maintenance of the grounds, which include all the bungalow gardens, etc, was done on 40:60 — 18 units were contributing to the gardening wages and 40% from the 12 bungalows.

Q106. Mr Teare: Just to stop you there, sorry, sir, you have said that the services were provided universally; but people in the apartment block get the services of a warden, and they also get a concessionary TV licence, but the people in the bungalows do not. Is that not a contradiction in terms?

Mr Canaan: The services that were required under the maintenance agreement are provided universally, sir. The TV licence is specific, from the TV authorities in Bristol, for sheltered accommodation that is not freehold.

Mr Teare: Well, I have evidence in my file that proves different, but we can move on from that.

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525 Mr Cannan: Well, sorry, sir, we have the letter from the TV people, stating that.

Q107. Mr Teare: So what you are saying then, is that the — (Interjection by Mr Cannon) Sorry, sir, I have the chair.

The Chairman: Oh, I think you will find I have got the chair! (Laughter) Interjection by Mr Teare) 530 Right, if you complete your question and then Mr Cannan will have the ability to answer.

Mr Teare: Don't you think, sir, that this is a bit of a rough and ready apportionment, as opposed to a scientific apportionment of the costs?

Mr Canaan: The costs involved in the maintenance agreement, which were universal — not the extra costs that are provided in the apartment block because there is a lot of extra cost there and it turned out that it makes no relevance to the maintenance agreement — they would provide an apportionment. If they are to be scientific, then each garden should be measured out in square yardage and the cost of the grass cutting and maintenance should all be apportioned... and then the service and then the general area should be apportioned, and then the call centre costs — that was apportioned.

The costs of the painting of the bungalows, that was separate because we asked... (The Chairman: Yes.) but not each bungalow, sir. If you are going to do 12 bungalows, then it would be _Ex thousand pounds.

Q108. The Chairman: The cost of the Warden was split, according to the —

Mr Canaan: That one was split because we have to have a warden on call. That is like a retained fireman. He is paid, whether he is called to a fire or whether he is not.

Q109. The Chairman: Just before we move on, would you be content to share with us the correspondence from the TV Licensing Authority?

Mr Canaan: Yes, absolutely but, unfortunately, I have not got it with me.

The Chairman: Of course, but after this —

Mr Canaan: I will send it to you.

The Chairman: Thank you very much. Mr Robertshaw.

560 Q110. Mr Robertshaw: Mr Cannan, good morning. From my point of view, it is trying to understand precedence of the allocation of the charges that I am not

clear about. There are certain charges which are very specifically laid out in the maintenance agreement, as covered and chargeable. I do not sou that same precedence appearing in the presentation of the accounts of the

565 bungalow holders. I just wonder whether you could enlighten us a little bit there. I think, at the beginning, you did indicate

that certain provisions were provided — I do not know whether you used the word 'altruistic' but a goodwill basis at the beginning. Would you agree with me that issues like painting the house and cutting the grass and things, which were very specifically in the agreement, should appear first in the maintenance agreement, in

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terms of charging or apportioning that out first and then applying the residual cost to any other services that were available, applied, allotted?

Mr Canaan: The specific charge for external decoration of the bungalow is specific in the accounts. You

575 get a bungalow maintenance account, showing it as specific.

Mr Robertshaw: But would you agree that it has priority in the accounts, the apportioned charges against the — ?

Mr Canaan: [Inciudiblei ...the apportionment, that was a specific charge, because you get a separate

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estimate and account for the bungalows. You have the bungalow maintenance account. Surely the actual cost of doing the bungalows, the actual cost of doing the gardens is... The gardener does the whole lot and, in actual fact, while they are only charged on the account 40%, the area of gardens is probably greater than the gardens.... than the main gardens, if you follow what I am saying.

Q111. Mr Robertshaw: It is just the way it is presented in the accounts, in the sense that the... we are talking about precedence here, that there are very specific things which are chargeable against the amount of revenue received from the bungalow holders, but those charges appear, not as an afterthought in the accounts, but after other charges are apportioned. That is what I am confused by.

I am asking you to look at the possibility that perhaps the painting and the grass charges, the grass cutting charges, should be apportioned off against the revenue received from the bungalow holders first. That has not been the case and perhaps would appear to be why a deficit would have appeared later on that you have subsequently written off.

Am I not being clear in my questions?

Mr Cannan: Perhaps you might ask our accountant when he... (Mr Robertshaw: Indeed.) The bungalow maintenance account shows the ratio of 40:60 on those services that are universal, in the

sense that then... that's it.

Q112. Mr Teare: If we just have a look at the bungalow maintenance account, the figures which you have been circulating to the freeholders. The 2009 accounts, service charges — that is the levy, income coming from the freeholders, I assume — E21,27 I ; expenditure, salaries, £[6,500. Can you give the Committee a breakdown to be more precise of those salaries?

Mr Cannon: Well, I cannot do it off my head hut, basically, it is 40%: the Warden has to be there for the... [Inaudible] in the agreement, so 40% of the salary of the warden is included; 40% of the secretarial charges is included —

Q113. Mr Teare: Is there not an argument to say, then, that they are paying...? You said that the warden service has not been withdrawn, but they are not getting the same level of service from that warden as those who are living in the accommodation block, but then the inference is that they are not benefitting from that, in terms of the charges they are paying.

Mr Cannan: But the inference is that the Warden has to he there, whether... As I have said, a fireman gets a retained salary, whether there is a fire or there is not.

Q114. The Chairman: Can I try another angle, then, in terms of the secretary? The only thing that the secretary would administer is the grass cutting.

Mr Cannon: I beg your pardon. She administers the grass cutting, the payment of the money coming in, getting the tenders... She is there to provide an office service, and she is only employed two afternoons a week for two hours.

Qt15. 'The Chairman: But given that the relationship that you have with the bungalow holders is a sort of arms's-length freehold contract, it is not as intense as the service that you need to provide in the block, is it?

Mr Cannon: It may not be as intense, but if you look at the bungalow maintenance account, it is running at a deficit, so that... and we have written off the deficit...

Q1 t6. The Chairman: So it has been charged and then sort of rebated because you accept these facts.

Mr Cannon: Yes, because we are carrying out the terms of the agreement.

Q117. The Chairman: Was there an explicit agreement between the Housing Association and the residents as to this is how the apportionment would work?

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Mr Carman: No.

The Chairman: Right, okay, thank you. Mr Teare.

Q118. Mr Teare: Has any offer been made to the freeholders to nominate a representative to join the trustees?

Mr Cannon: No. There was, but it was withdrawn.

Q119. Mr Teare: Why was it withdrawn?

Mr Cannon: Because it was only going to be conditional on... well, we withdrew it when we set aside the 650 deficit, so that, therefore, things were continuing in accordance with the agreement.

Q120. Mr Teare: Could the argument, then, not be advanced that this cost is taxation without representation?

Mr Carman: This is no taxation, sir; this is a civil agreement.

Q121. Mr Teare: But, surely, you are levying a charge, but arc you providing a high level of detail to justify that charge? In the figures that you send out to the freeholders, there is no breakdown in respect of salaries, and so on and so forth. It might be said that those freeholders are, in effect, subsidising the operation of the main block.

Mr Cannon: We do not see it that way, It is running at a deficit, and we have set aside the deficit and we arc now rebating the deficit. So there is no subsidy in it at all.

The biggest single cost, apart from the wages and the grass cutting, is the tri-annual external decoration.

Q122. Mr Teare: When did it become apparent, sir, that the income was insufficient to cover the outgoing?

Mr Cannon: After about six years. 670

Q123. Mr Teare: After about six years, so that would be 2005'?

Mr Cannon: 2004-05.

675 Q124. Mr Teare: 2004-05, yes, and what steps were taken at that time to address the issue?

Mr Cannon: The issue was not addressed immediately. We waited to see a further three years, on the... because the initial single cost was this redecoration, which we are quite happy to do. It is contractual and we carry it out.

Q125. Mr Teare: So, to summarise, sir, there was no immediate pressure to resolve it then, but the pressure came when the redecoration was necessary.

Mr Cannan: Yes.

Q126. Mr Teare: Yes, okay, thanks. At that time, when the redecoration was necessary — and, from the papers that we have read, there was a

view that the terms of the maintenance agreement should be varied — was any attempt made to negotiate that, or was it presented as, 'Well, that is what we have to do, so that is what we are going to do'?

Mr Cannon: There was a meeting in May 2008, as 1 have already said, with our accountant present, our

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lawyer present and, as I have stated, we found that there was no agreement and that people... the residents said they wanted to stick with the agreement and that was it... (Interjection by Mr Teare) tinaudible] nature of the agreement, and that all the accumulated losses would be written off.

As I said at the beginning, we just carried on with the terms of the agreement and just said that if they want extra services, which were not provided through goodwill, there is a charge of .0,50 a week.

Q127. Mr Teare: Okay. So from your perspective the trustees were prepared to negotiate, but you felt that the freeholders were

not?

Mr Canaan: We felt that the freeholders, at that meeting... some of them felt they were paying too much, anyway.

Mr Teare: Sorry, to get back to the question, sir. The Committee were prepared to negotiate, but you felt that the freeholders were not prepared to?

Mr Cannan: The meeting was called and the outcome of the meeting was quite obvious that there was no point in negotiating upwards. Nobody was interested in paying any more than they were paying at the present.

Mr Teare: So, to get back to the question again, and split it down into two parts, were the trustees of Kirk Michael Community Housing Association prepared to negotiate?

Mr Cannon: They were prepared to negotiate the rate upwards, but there was no... At that meeting, it was clearly indicated by everybody present that there was no interest in negotiating, so therefore we wrote off the deficit.

Q128. Mr Teare: But there was no view that an alternative approach should be adopted, a round-the-table meeting to see how the costs could be controlled?

720 Mr Cannon: The indication at the meeting was that they must abide by the terms of the agreement, and so

we carried on on the terms of the agreement. To change the terms of the agreement, we would have had to have every individual bungalow owner change the... be involved in legal fees etc.

725 Mr Teare: So the answer to my original question is no?

Mr Canaan: Yes.

730 Mr Teare: Thank you.

The Chairman: Mr Rohertshaw,

Q129. Mr Robertshaw: Mr Cannan, the agreement has been running for some time now. Was there,

735 between the parties, a recognised resolution procedure for disagreement in place already, or not?

Mr Canaan: The agreement was when Parkinsons sold the houses. They sold them with the agreement.

Q130. Mr Robertshaw: There was no process recognised by both parties that there should be a resolution

740 procedure in the event of a dispute?

Mr Cannon: The parties signed... they all signed it willingly. There was no... They signed it with their lawyers.

745 Q131. The Chairman: So the only resolution procedure, in effect, is through the court?

Mr Cannon: Yes, well, just the same as a farmer renting his field. There is no difference. It is civil contract if a farmer rents his fields.

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Q132. Mr Robertshaw: Would you welcome the extension of any of the provisions of the Property 750 Service Charges Act 1989 in terms of recognising the situation between yourselves and the property holders?

Mr Cannon: It is indicated, at the hearing when you had the petitioners, that they wished to withdraw from the whole agreement.

1 have indicated that we will address this problem as soon as you have made your report.

Q133. The Chairman: The question I think, though, is in terms of the Property Service Charge Act, which you are aware of, and whether you would welcome the extension of that in circumstances such as this, whether you think it would be a useful tool which would give... Effectively, one of the things it would do could be to give a dispute resolution procedure through the Rent and Rating Appeals Tribunal.

Mr Carman: No, this is a civil contract.

The Chairman: Yes, that is the status at the moment.

765 Mr Carman: And that status should remain. Those who wish to withdraw from it, we feel that we will address the subject and we will agree to it after you have written your Report.

The Chairman: Mr Teare.

770 Q134. Mr Teare: Do you not feel, though, that somebody who rents a property on a leasehold basis also enters into a civil contract?

Mr Cannan: These are not rented bungalows.

775 The Chairman: No, no.

Mr Teare: No, I am sorry, sir, that is not the question.

780 Mr Cannon: I am not a lawyer.

The Chairman: No, but if you buy a property in a block of flats, there is a maintenance agreement with the management company of the block.

Mr Cannon: Yes. 785

The Chairman: That is a civil —

Mr Carman: That is right.

790 The Chairman: — agreement, inasmuch as the arrangement that you have is a civil arrangement.

Mr Cannan: That is right.

The Chairman: Yes, okay, I think that was the question.

Q135. Mr Teare: So isn't there a corollary, then, that there should be a similar arrangement for freehold property?

Mr Cannon: I do not have an opinion.

Mr Teare: But you would not disagree with it, then?

Mr Cannon: I do not have an opinion.

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The Chairman: Mr King.

Q136. The Clerk: Thanks, Mr Chairman. Mr Cannan, I am relatively new to the Isle of Man: as you know, I have been here for about four years.

All this happened before my time and 1 would be very interested — and I think the Health Committee — if

you could say a couple of words about why you ended up with such an innovative development. You had a combination of apartments, which are rented and houses which are sold and it seems to me to be quite

unusual. Why did you go down that path?

Mr Canaan: We did not go down that path. We were invited by Parkinsons — we sold the land free and

unencumbered by Parkinsons to do what they wanted.

Q137. The Clerk: Do you think that Parkinsons would have done the same thing, if there had been a

greater level of regulation on the sheltered accommodation market — or the sheltered accommodation industry?

Mr Canaan: I cannot speak for Parkinsons. They bought the land from us and decided to build elderly

persons' bungalows and asked us would we provide a service agreement which, in hindsight, we regret we

did, but that is another issue.

At the time we were full of goodwill and we built the apartment block. We were exceptionally successful,

we raised money, we were full of goodwill.

Q138. The Clerk: Forgive me, I have not been to Carman Court, which is a terrible omission, but I was struck by your description of sitting round the dining-room table with architects and so on, in the white heat

of creativity. Was your original vision one just of the apartments blocks, to which Parkinson then built on the

bungalows, or was the whole thing part of a concept?

Mr Canaan: No. The concept was that the landowner sold us the land and, at the time, when he sold us

the land, we did not know how much land we wanted. So he sold us a portion of the field, and he said, `If there is surplus, you can sell it.' That was the donation.

Q139. The Clerk: Was the initial vision of the Community Housing Association just to build an apartment block?

Mr Canaan: It started off with just a... That was a big enough commitment without anything else. We were concentrating on building this apartment block and raising E I million, and I can assure you, Mr

King, to raise .E l million on a community basis, not an all-Island basis — this was a community basis — is no mean feat and the committee did very well and we are exceptionally grateful to the benefactors. No mean

feat! It was not like the Hospice raising L I million, which is everybody contributing from the Calf of Man to

the Point of Ayrc. This was parochial.

Q140. The Clerk: When you envisaged building an apartment block, did you envisage having a warden in it?

Mr Canaan: Yes.

Q141. The Clerk: And what did you envisage the warden doing?

Mr Canaan: What all wardens do.

Q142. The Clerk: What does the warden do for the residents of the apartment block?

Mr Canaan: The warden... and they pay, it is in their rent. They pay... Because the rents are the same as the Government's sheltered housing accommodation and the charges are

the same, they do exactly as the wardens in Government sheltered accommodation.

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860 The Chairman: So it is a good neighbour.

Mr Cannon: Sorry?

865 Q143. The Chairman: It is a good-neighbour system. You knock on the door: 'Are you alright, Mrs Jones?'

Mr Cannon: Yes, and there may be a little bit extra because this is not bound by the Government rule book.

870 Q144. The Clerk: Okay, well, the other question that I was going to ask, Mr Cannan: in the maintenance

agreement, it refers to the Warden, and it says that the grantor — that is you — grants to the grantees — that is, the residents of the bungalows —

875 to use, in the case of emergency, the telephone and intercom system installed M the premises to notify the Warden residing in the

apartment block of such emergency'.

Mr Cannon: Well, that is alright, they have all been fitted with it.

880 Q145. The Clerk: What is the Warden supposed to do in such emergency?

Mr Canaan: The Warden is supposed, in such emergencies, to get a doctor, see about an ambulance etc, depending on what the emergency is.

885 Q146. The Chairman: And the Warden holds keys to each of the properties?

Mr Cannon: If the bungalow person wishes, the Warden will,

890 Q147. The Chairman: Does the Warden not hold keys to all of the properties?

Mr Canaan: Not if person in the bungalow... It is their own private home.

Q148. The Chairman: But, in practicality, does the Warden hold keys to all of the properties? No? Okay. Mr Tears? Mr Robertshaw?

895 Just one more question from me. Would you have any concerns about the relationship that there is at the moment between the Housing Association and the occupants of the bungalows? Would you have any concerns about that contract between the two parties falling under the auspices of an appeal system by the Rent and Rating Appeals Tribunal?

900 Mr Cannon: I do not think it comes under the terms of the Rent and Rating —

The Chairman: No, it does not at the moment. I am asking you if you would have any concerns if it did, as a lower-cost appeal of —

905 Mr Carman: It would have wider implications and it would be for the committee to consult on it. It would not be for me to give an opinion. It has implications for not just the Kirk Michael Community Housing Association. It has wider implications.

Q149. The Chairman: Of course, C can only ask you to reflect on the circumstances of the committee, but 910 what other wider implications would you consider there would be and, specifically, which of those would

give difficulties?

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Mr Canaan: Well, if I can say so, sir, of the bungalows I have given you the case of Mr and Mrs Clague, who are quite happy with that, so they do not obviously need to... and they have done that of their free will. There are one or two...

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Of the petitioners, there were four houses; now there are three. There are Mr and Mrs Cook living in one of the other bungalows. There is another bungalow that has a very elderly lady living there now, in her 90s, who is happy to pay the —

The Chairman: I am just asking what other implications.

Mr Cannon: — and there are others who are quite happy with the present arrangement. It is only now, basically, three petitioners — four persons but three petitioners.

The Chairman: That did not answer my question about what wider implications would there be for you and your organisation for having this contract sitting under the appeal mechanism of the Rent and Rating Appeals Tribunal.

Mr Carman: That is a matter for the future but, as I have said earlier, we will be reviewing the agreement and giving the householders the option to withdraw.

The Chairman: I understand that, but I am just trying to narrow it down: what concerns it would give you if this was, potentially, a recommendation that the —

Mr Carman: I will discuss it with the committee, sir. I am not a one-man band.

The Chairman: I understand that, but off the top of your head, there is nothing that springs to mind?

Mr Cannon: Off the top of my head? I am too old, sir. (Laughter)

The Chairman: Okay. If there are no other questions around the table... Thank you very much, Mr Cannan, for coming in and giving your evidence today.

Mr Gardner was called at 11.10 a.m.

EVIDENCE OF MR M GARDNER

Q150. The Chairman: Good morning, Mr Gardner. If you would not mind, just for the sake of the Hansard record, giving us your name and your relationship

with the Kirk Michael Housing Association, please.

Mr Gardner: Sure. My name is Michael Gardner, I am the financial adviser to the Chairman and Committee of the Community Housing Association.

Q151. The Chairman: Within that role, you are the preparer of the accounts?

Mr Gardner: I am the auditor of the accounts..

Q152. The Chairman: Right, so who would prepare the accounts?

Mr Gardner: Well, Mrs Stewart is the accountant per se.

Q153. The Chairman: In terms of the basis of your instructions, then, do you have a contract with the Kirk Michael Housing Association?

Mr Gardner: That is a very good question. I would say yes, but I have to say, firstly, I have not got a copy with me.

Q154. The Chairman: Okay, and you do not see there is too much of a conflict of interest between your

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role as a financial adviser to the Association and the auditor of the financial statements?

Mr Gardner: No.

Q155. The Chairman: Okay. In terms of... Obviously, as you have heard during the previous evidence session: one of the significant

matters that has been raised is about the apportionment of the costs, especially the Warden's and secretary's costs. I was just wondering on what basis you were involved in that apportionment process and were able to audit the validity of that process.

Mr Gardner: Well, it is an assumption, at the end of the day, as to what percentage of those costs should be allocated to the bungalows. We have clearly taken, or the committee has taken, a fairly simplistic view and allocated

985 There are, potentially, other methods of doing it, as we mentioned before in terms of grass cutting — we could measure each individual plot size and work out a more scientific method of allocation but, at the end of the day, it is felt this is disproportionate to the benefit.

Q156. The Chairman: So you have been working on the basis that, as the residents have quite happily been paying out their money on this, there must be a certain amount of agreement.

Mr Gardner: Well, I do not think the residents necessarily pay their money on the basis of the allocation that is in the maintenance scheme. They pay their money for the services they receive.

The Chairman: Right, okay.

Q157. Mr Team: Do you feel that the apportionment is fair, equitable and would stand external scrutiny?

Mr Gardner: It is a set of assumptions. I suspect you could have 20 different assumptions from 20

1000 different people. So, it is a set of assumptions: yes, they are fairly simplistic but, at the end of the day... they are reasonable.

Q158. Mr Teare: But if you actually add the cost to the block and the cost of the maintenance agreement with the freeholders, and then apportion that out in respect of the two parts, would that not be a fairer system and better to justify?

Mr Gardner: Could you give me an example. When you say costs, what do you mean?

Mr Teare: The grass cutting, the painting —

Mr Gardner: The grass cutting is always done — as I understand it, I am not clown there, but as I understand it, the grass cutting is done for the whole complex at any one particular time. So you do not come clown and just cut the grass at the bungalows and come back another day — so, I am not sure... As far as I understand it, the Association gets a bill from the grass cutter and that is for the whole complex. Sol am not quite sure how more accurate —

Q159. Mr Teare: Right, but in terms... just take the accounts which you sign off, as it were, in terms of the actual cost of redecoration. It. seems in 2008 it was .£9,600, 20 11 it is estimated to be £10,000, so we work on that £10,000 basis and spread that over three years, it actually comes out at 123 per bungalow per calendar month —

Mr Gardner: I will take your word for that!

Q160. Mr Teare: So there is not an awful lot left for the grass cutting, then?

Mr Gardner: Well, and the services of the Warden, I think if you look at the maintenance account, the significant expenditure is [Inaudible]

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Q161. Mr Teare: It is, but we have just heard before, that the availability of the Warden services is

severely truncated.

Mr Gardner: Well, the Warden is there as and when... If somebody has a fall every single day of the year,

the Warden would be there every single day of the year. The fact that they don't is hardly the Association's

problem.

Q162. The Chairman: I think this is where we come to the difference about those who are paying the

£3.50 and are able to get that service and those who are not, perhaps, but that is not something that you have

been involved in at a detailed level?

1040 Mr Gardner: No.

Q163. The Chairman: And in terms of the apportionment, is it a piece of work that you would do to

ensure that there is a contract in place between each of the bungalow holders and the Association, to ensure

that there was a contractual requirement for those fees to be paid?

Mr Gardner: No. The income has been received by the Association.

Q164. The Chairman: So there is an implied contract because the income has been received.

Mr Gardner: Correct, sir.

The Chairman: Okay.

Mr Robertshaw.

Q165. Mr Robertshaw: Good morning, sir. I come hack to the question I posed to Mr Carman, and he referred it to you, (Mr Gardner: Thanks!)

It is a concern on my part about the precedence in the application of these costs. There are certain costs that are specifically identified and require to be paid, and there are other areas of cost which we have heard, to

some degree, fall under the heading of goodwill or possible goodwill. What I am at a loss to understood is

why areas which can be classed as being under the area, or possibly under the area, of goodwill show

precedence in the accounts over those items which are very specifically within the agreement. Would you not agree that that is... why a deficit was eventually shown?

If the reverse had been the case, would you not agree that there would never have been an instance of a deficit showing, anyway? As adviser, why would you be comfortable with that particular reverse precedence?

Mr Gardner: I am not sure I fully understand the question.

Mr Robertshaw: Well, why if you, in simple terms, place the revenue at the top — (Interjection by Mr

Gardner) No, I am talking about the accounts, as presented; you place the revenue at the top. 1070 1 would have thought, as adviser, you would have wanted to see the application of those costs which were

specific to the agreement identified, deducted first, and then looked at the balance of revenue available left and apportioned that off to other possible goodwill services provided.

To me, it appears upside down and back to front, and the cause of the disagreement in the first place. I just wondered what your comment on that would be.

1075 Mr Gardner: I am afraid I —

Mr Robertshaw: Are you familiar with the accounts?

1080 Mr Gardner: Yes: are we talking about the [Inaudible] ...accounts or the actual financial statements?

Q166. Mr Robertshaw: Both, effectively, but if you look at the presentation of the deduction of costs,

you see the apportionment of the costs against salaries etc first but, higher up the page and then at the bottom,

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you see the deduction of the apportionment of costs for the painting. Wouldn't it have been better to turn it the 1085 other way round, to make absolutely sure that you had the cost of the painting and the grass cutting — which

were specific to the agreement — clearly deducted and protected in the presentation of the accounts, and then find a way to apportion the balance of the costs off to salaries?

Mr Gardner: I think the structure of the (Inaudible] ...accounts as they stand at the moment was... 1090 Because the decoration is once every three years, whereas a lot of the other costs are annual, the ongoing

regular costs... Because the decoration — the redecoration — is a triennial event, the theory was that the maintenance account would produce a surplus each year which would build towards that three-yearly cost of redecoration.

1095

Q167. Mr Robertshaw: The difference being, though, that the triennial costs were absolute and clear and specific liabilities, and yet there were the deductions against salary etc which, albeit were annual, were actually partially, potentially, in the goodwill area.

1100 Mr Gardner: Not necessarily.

Q.168. The Chairman: I think I have got the gist of where we are coming from here, in terms of... (Interjection) No.

Correct me if I am wrong, Mr Robertshaw, but I am saying that against... What you were looking to see is the first thing that would come off the revenue would be those costs that were legally required to be borne

1105 under the contract, not those... and then, after that, you see if there is anything left to then be apportioned.

Mr Robertshaw: Exactly.

1110 Mr Gardner: But the provisions for a warden, for instance, is in the contract.

The Chairman: Yes, but the provision of a secretary, for example, isn't.

Mr Gardner: No.

1115 The Chairman: And I think that is perhaps where (Interjection) Mr Robertshaw is coming from. That would be a matter of presentation of the accounts.

Mr Gardner: But, at the end of the day, I asked Mr Carman this, as you have referred to already, the need for a secretary's services for two afternoons a week. So the actual allocation of the secretary's salary costs to the maintenance agreement is relatively small.

Q169. The Chairman: But perhaps compared to the way that Mr Robertshaw would have liked to have seen the accounts prepared, as opposed to the way that you have prepared them... sorry... the way they have been prepared by the Housing Association, perhaps you would just care to explain why they have been prepared the way that they are prepared.

Mr Gardner: I would not necessarily see the secretary's costs as a goodwill gesture, for instance. They are a necessary expense of running the complex.

Mr Robertshaw: In accordance with the agreements that the —

Mr Gardner: In accordance with running a complex and, if that means collecting the service charges from the residents —

Q170. Mr Robertshaw: But not necessarily in accordance with the agreement that the bungalow holders signed?

It is a question of from which position you view the accounts, isn't it? Is it fair to say — is it unreasonable to say — and please shoot me down in flames if you think you wish to — is it unfair to say — and I have perhaps picked something up wrongly here, but I am given to understand that the rents that people who actually will

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live in the apartment block pay, are tied to set Government rates? That is correct? So, was the priority of concern, therefore, on the part of the apportionment, such that the desire is to make

sure that the rents that the rentholders in the apartments paid, has stayed within the terms of Government rates and, at the same time, you managed to cover — properly cover — the salaries of the Warden and the secretary?

In other words, would you agree with me that the position you were viewing the bungalow holders' agreement was secondary to your concerns about making sure the presentation of the accounts within the complex, as a whole, were contained and covered?

Shall I try that question again'?

Mr Gardner: You might.

Q171. Mr Robertshaw: Okay, let us look at it another way. Supposing you were not able to apportion the Warden's and secretary's salaries to the bungalow holders to the extent that you have. How then, would you, thereafter, manage to retain the rents that the people in the apartment block pay, and yet still cover the cost of the secretary and the Warden?

Mr Gardner: Sorry, were you saying, if we did not have the bungalow —

Mr Robertshaw: Yes. How would you retain the rents within the apartment block at a level which would stay within Government levels, or agreed levels?

Mr Gardner: There would have to be additional fund raising. I think, as you can see from the financial statements, each year there is a significant level of voluntary donations and fund raising which takes place and which obviously goes towards the central pot.

Mr Robertshaw: Thank you.

Q172. The Chairman: Mr Carman made clear in his evidence that there was no explicit agreement on apportionment. You, therefore, have adopted the view taken by the committee on this. Clearly, I presume that you would have reviewed that if there had been significant complaints or a payments strike from the residents?

Mr Gardner: Yes.

Q173. The Chairman: Was it, therefore, your advice to the committee that the £13,999 deficit in the 1 175 bungalow maintenance account should have been written off because it was not reclaimable?

Wr Gardner: I was at the meeting with the residents in May 2009. There was clearly confusion about that deficit and understandably so. I think there was a feeling from the residents that they felt it was either an overdraft or a loan facility that had been granted to them, in that they were liable for that deficit, whereas that was not the case. It is an internal application, if you like, between the bungalows and the apartment block. So to take away that confusion, the committee decided to, effectively, eliminate the deficit at that date.

Q174. The Chairman: Would it be your view that that money would not be reclaimable from them in retrospect, anyway, because they had fulfilled the payments in accordance with their contracts?

Mr Gardner: It certainly would not be reclaimable from the residents.

The Chairman: Quite. Hence the —

Mr Robertshaw: Sorry, was that wouldn't'?

Mr Gardner: Wouldn't.

The Chairman: Okay, that answers that question.

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Mr Gardner: Not as far as I ant... unless there is something in the agreement to say that there was, but my understanding is that that is not reclaimable from anybody. It is an internal allocation between the two.

The Chairman: Thank you.

Q175. Mr Teare: Just for the record, Mr Gardner, the accounts that we have in front of us are for the year ended 31st December 2009. In terms of your audit opinion, and I quote:

I have not obtained all the information and explanations that I considered necessary for the purpose of my audit and I was unable to determine whether proper accounting records had been inaintained:

Could you give us a hit of background about that, please? I have seen it in other accounts before, so if you could let the Committee know why you felt it appropriate that it should go in this particular set of accounts, it would be helpful.

Mr Gardner: Well, it would go into the vast majority. I would say 95%/99% of all charity accounts would have similar wording.

Charities, by their very nature, tend to have significant levels of fund raising or donations which, by and large, come in by cash. It is very difficult, as an auditor, to verify that level of cash. In a normal trading

1215 transaction, if you go into a shop and hand over cash, you get something in return. You get your goods that you have purchased. In a charity situation, you purely hand over the cash and get absolutely nothing in return, so there is no other half of the entry. So where there is fund raising which is largely cash, it is very difficult, from an external point of view, from an independent point of view, to verify whether that cash...

So for instance, I could... I am sure you guys are members of charities or trustees of charities, but if I 1220 passed you a El 0 note and said, This is for your charity,' and you forgot about it and left it in your trouser

pocket and it went to the cleaners, there is no record of that anywhere. Therefore, the auditor of your charity would not know if that E10 did not appear in the accounts. It is more a question of what is not there than what is there.

1225 Q176. Mr Teare: So, for the record, then, the qualification has got nothing to do with the freeholder issue, with the apportionment — nothing at all.

Mr Gardner: No.

1230 Mr Teare: That's good. Thank you. That has cleared that up.

The Chairman: Mr King.

Q177. The Clerk: Thank you. 1235 1 would like to ask a few more questions about the apartment block side of the equation, because it has

come out already, this morning, that particular salaries were one of the big expenditures. It is divided 60:40, based on the number of units — 60% by the apartment block and 40% by the freeholders.

We were talking about the freeholders but, turning to the apartment holders, they pay rent. Mr Carman said earlier that the rent is based on the Government system of setting rent for sheltered accommodation, and the

1240

warden services were based on the Government system for sheltered accommodation. So my question is: that 60% of salaries, is the rent received from the apartment holders enough to cover that?

Mr Gardner: I think this comes back to Mr Robertson's question.

Q17$, The Clerk: There may be another way of asking the same question. Does that 6% come from the apartment residents or is it subsidised by other income?

Mr Gardner: It is very difficult to say, isn't it'?

The Chairman: It is not a specific element set out in the rating.. in the rent setting criteria, is it? Therefore, it all falls within general funds.

23 EPTSCFP260111

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63


Q179. The Clerk: So, if you paid rent, as an apartment holder, the rent you pay provides a roof, heating, perhaps [Inaudible] „ .but it provides you with the right to be there, as well as the normal service. Is that

1255 right?

Mr Gardner: Yes, there are the rents that the apartment people are paying, [Inaudible] ...so the rates element of the rate they pay does cover the rates that the Community Housing Association has to pay. So there is a direct match there. Similarly, the heat and light, although it is very difficult to know what the meter volume is, heat and light charges are going to be: there is an attempt made to match up the income with the likely expenditure, so they should match.

The rent, the floor rent, the amount the apartment people pay, is there to, as you say, to provide them with a roof over their head and for the other services that are provided. But it is difficult to say, because there is some other fundraising and donations that go on, which go towards running the properties.

Q180, The Clerk: I think you said that if the costs went up and the rents prevailing — Government level —then there would have to be other income generated. The Housing Association would have to fund that gap from somewhere else.

Can I ask — we have been told that the rents are set at a Government level — is that a matter of contract? Is there a contract with each apartment resident which says the rent will be the same as the Government level, or is it a matter of discretion and you decide each year to match the Government level, but you could do something different?

Mr Gardner: I am not party to those discussions, I am afraid. The rents are set by the Community and I do not have a say in those, so I am not able to answer that question, I am afraid.

Q181. Mr Teare: In view of your detailed knowledge of the finances of the charity, do you feel that there is a element of cross-subsidisation between the freeholders and the leaseholders?

Mr Gardner: On the basis of the maintenance account I would have to say, yes, because the maintenance account shows that [Inaudible] ...but, again, it is based on those assumptions. Those assumptions, as we said from the outset, are set assumptions and twenty different people would give you twenty different sets of solutions.

Mr Teare: Is that wise? (Laughter)

Q182. The Chairman: Okay. Are we all done?

Mr Gardner: Could I just have one... sorry, Mr Chairman. Just to pick up On something that Mr Carman said earlier, that I think you raised, Mr Teare, in terms of a mediation service. At that meeting in May 2009, Sally Bolton was there as the legal adviser to the Association and she did offer to act as a mediator ...to use Sally Bolton as a trained mediator on legal terms, and she did offer to act as a mediator.

The Chairman: But she is employed by the Housing Association, or retained by the Housing Association, so there might have been a perception of bias. However, I take the point, yes, thank you.

Okay, well, thank you very much. Thank you for your time. Thank you, ladies and gentlemen. The Committee will now continue to sit in private. Thank you very

much for coming this morning.

The Committee sat in private at 11.33 a.m.

24 EPTSCFP260111

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Appendix 1

65

Appendix 2

KIRK MICHAEL COMMUNITY HOUSING ASSOCIATION Telephone/Fax: (01624) 878193

Registered Office:

Cannan Court, Main Road,

KIRK MICHAEL, Isle of Man.

IM6 1 FA

14th February 2011

Mr Jonathan King Deputy Clerk of Tynwald Legislative Buildings Finch Road IM1 3PW

JJ Dear

Select Committee on Service Charges and Freehold Property

In response to your letter dated 8th February regarding the rent paid by residents in the Apartment Block at Canaan Court, I am pleased to provide the following information.

At the time of completion of the construction of the apartment block it was agreed with the Department of Local Government that the initial rent of the apartments would be assessed in accordance with Government guidelines by the Housing. Officer, Ramsey Town Commissioners, and thereafter the annual increase in rent would be identical to the annual increase in rent for public sector sheltered housing.

The Management Committee have strictly adhered to this agreement.

Yours sincerely

David Carman Chairman

Isle of Man Charity Registration No. 670

Chairman: David Carman, M.H.K. Company Limited by Guarantee

Warden: Mrs. S. Wallis

Registration No: 060705 C

Clerk/Administrator: Mrs. J. Stewart

67

rilaoe < Acp pendix 3 di , o f (61 r One thousand nine

hundred and ninety seven BETWEEN ISLE OF MAN PRODUCE COMPANY

LIMITED a Company incorporaited in the Isle of Man and having its Registered

Office situate. at Whitehouse Farm in the District of Kirk Michael (hereinafter

referred to as the Vendor" which expression uniess inconsistent with the context

shall include the said Isle of Man Produce Company Limited and its successors and

assigns) of the one part and KrRK MICHAEL COMMUNITY HOUSING

ASSOCIATION a Charitable Company Limited by ;-.aving Re..c4istered

Office situate at Whit' gables Curra:.-1-n Road Balla: Crleremaf',er referred to as "the

Purchaser" which expression unless incon.sisten7. shal:Mclude the

successors and assigns of the said Kirk Micha,:?.; Coil :TILH:y Assoc:Jai:ion ) {)::

the other part

WHEREAS :h2 'V'endor is seised and possesed ch.. A Li_

t he- Whichous- Es:a:e

'.() te Fsza:c")

(inter aka) i tj by a Dean of COnucyanc.%. beuri:iv dayo May t973 .ram

John Wilfred (2) by a Deed of Exchia:12

.

9

January 1997 alac'. between Ann GoY:,..-Jon

S;ephenson of

. C I., EI

bc,,aring date :he 1st. das of Oc...obe:.

AND WHEREAS the Vendor h c d barE of the

Estate as set }r :h and &scribed the Firit

p„t;: ,‘•

rerrred to as "Ole. Ra.:a:nt.ci Lan(f")

WITNESSETH that the Vendor in considerat i on of the sum of TWO :HUNDRED

AND SEVENTY THOUSAND POUNDS (f270,000) to the Vendor now paid by the

Purchaser (the receipt whereol is hereby ac1Knowlded) r.).:_: h, -Hereby grant baroa i rl

and for ever absolutely SELL ANT) CONVEY unto the Purchaser ALL AND

SINGULAR the Scheduled Property TOGETHER with all ways wa ters watercourses

easements liberties rights members privileges and appurtenances thereto belonginci, or

in anyv.-ke apprtaining thereto Or reputed or known as part or parcel thereof or

21DPure,lar- thereto ANT) IN PARTICI:I-AR so .f. a-' '-h.':!' may re l ate to the

Scheduled Property with the benefit of those con, aired H ( I) a certain Deed of

Conveyance bearing date the 29th day of October _196? from Marie Elisabeth

Geor,ina Seligrna;i to Keith N-for Skeh (2) a certain Dccc of Conveyance bearing.,

da:c.f: the IS:h Li v of October 1990 from the Veroior to K...,,saiii ,:zas (Isle or Mar;)

1 i:,,,,. ai,. c.,):_.,:.. 53 ,..... cor.d sch,::,,,,: l e. h,27,?..;.0 TO 1-LA VL \ f TO HOLD the same

P:..ii:.-...1e; ';';0:7; '.h .:: C.:`,1:,' 0: :':::', :::','. -2. :'.::7:2O: ::::-...' :,_-..1. and fo:',..-.'.ve;. but

SUBJECT n.e., e;heiess :o an:d wiWs. the 5e:-;en oT. a: ,..: .,-, \ - :.:, -,,,m.:. 2.;:1]:',.:OC.5 l'eSY:iCi0:-IS

piOvISOS ;:r =2:7.1-1z-lrits after :r1g the Sche,uld Property a: id :201-1...aird or referred

to in anv D,,,,efi of Conveyance or other iTIS',.TUITle;It Of ',::.,' :'.1.:'!'0F;:ir:,..)1 ir, daze hereto

, ' o,, ,H1H .-.:5::;‘g an,j ;apable or and Wilvreror,fec: so ;ar ieli:h as the same are n , .

b,.,g , :,, r.„.„-.,,,: -2.. : d SOB,) ECT ALSO to ail ea:,e; :.2:::, .,:.,:.:-.: .i2i, ' •:,:' l:-:::a''.. A.\ D

1N PARTICULAR th0S2%.0:"IL:111....:::! it :',.•.: Th. ,,H..: :::;.::...-..!".::.::

AND the P:.:7,:haSer DO:k 1-1,72rebv covenant wIth ?I.,. or oy.ner or o.Aners ror.

ihe :i'...', l',..,:,2 of the Retaine(i Land or any part tnereo: ;.....; ,

::;II.ALL_ ic.t a: ah ,, Wne. i.,2reat.,..-; eric..: , i :. ,,: ..::,.:11:..:-..1 Proper7.y

..iii .:!.. , ,.v‘.,...:. '.ha:ii re,,iden:ial .,i'::::, ..,.::: ,,-

/ I

4

70

outoffices and other relevant commercial/or service establishments

conducive to the development of the Scheduled Property as Sheltered

Accommodation as shall b'e required and or approved by the

appropriate Planning and Bye-Law Authorities and in par,,iciitar in

accordance with the Piannin,q, Permission No. 94/1193 or with such

amendments or variations thereto as the Vendor may aerec. in writino

(ii) SHALL forthwith erect and for ever after maintain a rood and

substantial stock proof fence and a and tr. such ina:ei-ials pis shall

be approved by the Vendor between the points marked A to B and B

to C on the plan hereto annexed

(ill) SHALL construct prior to the completion 07 cleveioprn,e7i: (-2:. the

Scheduled Property up to and C0f:;0;:iv. ith the boundarl; of the

Retained Land between the poin:s mar',:e.,::! X and Yon the pkIn he eto

annexed a .4k a:: r21..esisji.,.r:, z

shall be necessary for adoption and for use by vehicuan and pedestrian

traffic to gain access to and e`-) ' :s Retained Land. to the isitlin

Road marked on the plan hereto anreved and to :,:eet.) and maintain

such road and footpaths and ii no: and fooiat..'"....; tc,

constr;.:cted on the. St.:neduied and

condition and state of repair to the

(iv) SIIALL prior to the corripketon zi]omnen: o :he

Property construct and an up to am: c:ort:kruoti--; an-jEh

the Retained Land be:.ween the `< arc Nt. °r1

hereto annexed ail

71

connect the Retained Land to foul and surface water drainage water

electricity gas and telephone services to the satisfaction of the Vendor

(,) SHALL not erect or cause to permit to be erected any temporary

buildings or compounds on the Scheduled Property except such as are

necessary or convenient to facilitate the Purchaser's proposed

development of the Scheduled Property without the prior consent of the

Vendor and on the completion of the '•';e:;:i the Purchaser will remove

all such temporary buildings or corn p0,,M(iS

(vi) SHALL use reasonable endeavours to keep the roads both constructed

or to be constructed on the Scheduled Property and all roads now or

hereafter constructed on the Scheduled orovtcl i n access to or

egress from the Scheduled Prooe: .), R:-.:aned Land free from

mud clay lime or other materials •the wheels _racks

outer pars of any vehicles nain i ri - S,:r,reduied Property,

rri this clause "vehicle" includes ai:\, !raie:' or any imblement or

machine

iyii) SHALL at all times keep the porticv road coloured Blue

on the plan hereto annexed in a ‹an,od stare o 7Y:',:1- and

condition and free From ail the

exercise o f ;.1.,, e hEtt W a n cf:F :n u :-

of the Vendor

tviii) SHALL not except the ;!;,3 deposi: or

permit to be deposited on all or no,A

part or hereafter to be i); Ebr on

72

unreasonable time building materials or any building machinery nor

shall the Purchaser open up or disturb or pet- rnit to be opened up or

disturbed the soil or surface thereof exet-Tt with the consent of the

Vendor such consent not to be unreasonably withheld or delayed for

the purpose of laying drains or or water pipes or subterranean

conductors of electricity and telephone to ;he Scheduled P roperty

(ix) Further anon completion of the development by the Purchaser of the

Scheduled Property or at any prior tune that may be requisite to

arrange the cleansing and jetting or al Coui and surface waterdrains

laid under the Scheduled Property to eris;.ire the proper use thereof to

be made available for the bone... et. Lar..i and further

SO required to facilitate the aciop..):‘. :-oacl.s and fo(xpaths

sewers and drains construction or any par: or puts

:hereof and willforthwith :ne Vendor toEzether ith cii

others entitled to share the use and proper proportion

aceording to user of tan ironer*. tan V C:;Si , iris cleansing and

jetting our ad or any rbi.:1 and of Craiiis serving the

etained Land as ma:..

appropriate Statutory AuthoritiC:s

(X) SUALL nor prior to adoption o! 0,.eror r,.:1Q same hy the

relevant Authority do or rktrirHt or • •o o: omit to do or

permit or suffer to he omi.tied about the Sch:.'dtiled

•••:: Property"any act which may.' or darnat:te to th.

inte_rterence with an ,: roads r'k.)01p,:fl COM] UCLifIE

73

media now or hereafter serving or intended to sere e the Retained Land

or any past or parts there6f

) SHALL at all times:-

Consult with and keep the Venda:- informed wth regard to each and

every planning application or Appeal made by or on behalf of the

Purchaser relatingto the general layout the. Scheduled Property

including roads sowers services plots and amenity areas

(xii) AT ALL TIMES hereafter indemni and keep indemnified the

Vendor and its effects from and ag2lInsz a l .irsses cos ts damages and

zo" 0.0 expenses and all actions procee.dirgs cHaims dernands and

axisir:a o:

ce by the Purchaser cona,:led Gr non-Derfbrmari •

mentiched or referred to in this Dec.•:!, o:-

AND the Purchas..2r fwth the obiec, and inteh;:on o the Vendor a f:.111

and sufficienr. indemi-lity respec: the sad ;()\ :•,•••••,s restric,..ions

provisoes arid az.-.-e.ements but not ftirthe-roi- He:•ebv cover-ail(

mill the \.::::..ndor Purc...ha•se- a,!

bound by all the said covenants conditions r.estric:ion and ag.,reernencs and

will indemnify and save harmless the Vendor a -.1a;:l• ail

responsibility the Vendor may incur b‘, reason non-obse:vanct

or non-perl:Ormance thereof

AND the enior Dodl %k•

rink[ full power and law tJI a..;-i-ion•,y to orar::

"-a

bath

Sche...dJied

74

,:•.• • ti"

47' •

Property in manner aforesaid and that the Vendor )11;ill and will warrant maintain

uphold and defend the same unto the Purchaser free front ,n1:-.::mbrarices and from and

against the claim challenge and demand of all anc.1 eve::ry pL.r...rsons and person

whomsoever

1..,•'ITNESS WHEREOF the partis hereto havc d these presents this the

day month and year first befoR_i

FIRST SCHEDULE WITHIN REFERRED TO

ALL AND SINGULAR

land parr, 0 .E.- thcf.~~iand

Parish of Nfichael and being represented (for !..k or.I and

no!.. of limitation) on the Dlan ahr.exe;i hv :he and

(2) tha: poriion of the acce:s.s road delineated wid on the herer.o

annexed...

SECOND SCHEDULE \VITHH R EFERRED

THE • •'%.!

occupier for the time being of :he Scheduled Proile,::. and those

deriving title under it or them to and each of e\,;-,i Dart thereof

full, and free right and re in respect of the points

marl<ed E to C on the plan here.:o ahhexcda rea:,onai.;te hours

daring the day time over the Retained Larid and

repairs fence

75

THE person or persons exercising such rioht hereby granted causing as little

inconvenience and damage as possible and forthwith making nod all such damage

to the satisfactionof the Vendor or other tie ov..ner ow;ii-:3 for the time being of

the relevant parts of the Retained Land

THIRD SCHEDULE WITHIN REFERRED TO

IT IS EXCEPTEDAND RESERVED out of this conv'y•nce (and :he Purchaser

hereby grants) in fee simple to the Vendor or o, Amer or owners for the tie being or

thc Land or tmv part thereof and other the owners andior

OCCUpiers fore time being., (and those ......... or them) of the Retained

Land and each and tiny part thereof

FULL and fr-e. rio. ht and - \ ar.d its respective

servants licensees and invir_ees C'onmor, ParcliaSer and

others from time to El:Mt'havin r.J.) Jas aric.'. repass at atr

times and for aA puToses alono: roads and footpaths to he

consructwi nte Scheduled Prone- - or an;., Lhereof and all

;.tc) and ne.zessan]; for

the deveiopmer:t. and i, Itor an, purpose

authorised by the Plartnin!.-,

1;)e,t;ar .i n e n t or L.oca:

GOvernMerli and the Environrilcfn

LL and free r- ioht and tor e.lcor and its respective

servants licensees and invli.Le's Purchaser and ail

others from time to !;) n and repass at all

76

times and for all purposes without restrictiii with or without vehicles

and animals over and along the poHon of the access road delineated

and coloured Blue on the plan hereto annexed

(iii) FULL and free right and liberty (in common with the Purchaser and

all others from time to time having the like ri.tht) to connect into and

to use drains wit h in the S'ched'uled P:.c, perzy and all connections

therto for the drainag,e ror foIA ,,c-at:ir and storm water from the

Retained Land and from all or any an-d!or orfmr structures•

now or hereafter constructed or to be coristr,:oted thert;Dr1 or on any

part thereof and all rights incidental thereto

FULL and free ri t and ibeT.. %,.itn the Pl.irCi‘,aszn- and

all others from time CO time haiti.;:. 1010 and

to uso, services a:I ,::.onne:ctions

thereto fo:- the suppil; of wa:e'r :.,1*-phone and other

:services to the. Retaind land and structures

now or constructeci to he ,n)h.,;;;- .1...s.tel theye;:ln or on any

part thereof and all rights incidenia.

TEE . 7'01

the purpose of inspecting, repaHii:-; am: m,,iL;;ainirnl• an,, of the roads

drains and/or i.he services perdu :iii, , : ,,, ,.., 1-..2. same.

0 i t A right or support for walls am,l i.),:1(..1;;;...., ,.,..-y, a iak,:“ of acce:ss at all

reasonable hours durin-c.Ehk:i..da ,, „.. c ,...,:.— •-::' S.,:h:::(..lul.,:id Pri-Ter:Y for ...

s tre,...i.ktid or the purpose o; 'L •

to be en.t.70r...,2-d on tire boui.1,..lan, L -∎ . ':ii i•eiaine,d f.rom the

77

Scheduled Property and the to co:!S;1711C. maintain

overhanging eaves and gutters over th-

THE person or persons exercising any o si,:ch s hereby gra:IR:IL (i)

(Th) or (v) p0;;sit),-.;

aid forthwith makinY, Goody all such dama:.,: rcasomtle of

the Purchaser or other the owner or owners ':or the Y.rne.'oci:- o r,c:cvant

par. or parts of the Sc)cci,,iled Proper.

(vii.) in the event tha: the Piz:chase - ,-,ersons

responsibL1‘. for the n-lainEcria• :ne adoption

(•ithir, the Schcdolcd palhs

ar.c'„'or ari-i.cr al: H,•)c)

sac.. ra.:1 ,:oir:Dic:le

vC7 cas

F.C1

the ocolipiers Cor the

under ti andi or the;

;•11:: 7..; .• - • •

o:

:hcreoT and in 1,.s

0?.her tan person

3rproprlac

78

sewers and/or the appropriate existH: sewers and/or the appropriate

conduct mg media and/or the appropri;:ite connections for public

purposes in connection therewith) to eat' into and upon the Scheduted

Propeicy and itself or themsei ,,,e;) and wi:hoLv. i;ability for any

unnecessary damage thereby caused to carry out and do such acts or

things thereon as may be necessary to remedy any breach of anY Of the

covenants on the part of the Purchaser herein contained and in

particular as may he necessary to procure ftle adoption or takino: over

(as the case may be) of the same and;or any of them and in the event

O SUCh breach as aforesaid in cue name and on berm! (od' at the cost

and ex ease) of the Purchaser or or owners for th v.

time being of the Scheduled relevant par: or parts

thereof as aforesaid to enter into W:d1 the relevant

Local or other s7..zi:u',ory or oj:,:: as may be

requ':sie to procure the adoptio:1 or er (as the case m ay be)

of the same or ahv or them

ti

EXECUTED by the Vendor in the presence co

A •

•

79

;;T it?....v...1 q.' 'ffs. .' . .1-Wil. T'1,1!.1:-' . ,

.,.;:,,ii- '.'.,

,'1. , .1-iJ

/is, :

rIzz 7

i ,

'

81

L \ _

EXECUTED by the Purchaser in the presence of:

1-4

;'■.41'4 ,

a

"-) 71- .

1

,meesymyean1,04.7,44.7.60.01.010tIONNINI~OleleakqW

REGISTERED

-9 MAR 1998 at I IS50 0 No. ttk,0

Appendix 4 ki

(c-YJ M CHAEL

THIS DEED made this I-4w day of 1-6201-koit One thousand

nine hundred and ninety eight (1998) BETWEEN KIRK MICHAEL

COMMUNITY HOUSING ASSOCIATION a Charitable Company Limited by

Guarantee and having its Registered Office situate at White Gables Curragh Road

Ballaugh (hereinafter referred to as "the Vendor" which expression unless

inconsistent with the context shall include its successors and assigns) of the one part

and PARKINSON LIMITED a Company incorporated in the Isle of Man and having

its Registered Office situate at Parkinson House Peel Road in the Parish of Braddan

(hereinafter referred to as "the Purchaser" which expression unless inconsistent with

the context shall include its successors and assigns) of the other part...

WHEREAS:-

I. The Vendor is well entitled to seised and possessed in fee simple of ALL

AND SINGULAR certain hereditaments part of the Whitehouse Estate in the Village

District and Parish of Michael purchased by the Vendor by Deed of Conveyance

(hereinafter called "the Isle of Man Produce Conveyance") bearing date the 20th

day of October 1997 from Isle of Man Produce Company Limited (the said parcels of

and purchased by the Vendor being hereinafter together referred to as "the KMCHA

Estate")

2. The Vendor has prepared plans for laying out the KMCFIA Estate as a

building estate and the plan hereto annexed shows part of the layout thereof including

certain proposed roads and footpaths delineated and coloured Brown on the said

plan...

3. The Vendor has agreed to sell to the Purchaser the hereditarnents more

particularly described and set forth in the First Schedule hereto upon the terms and

conditions hereinafter appearing (the said hereditaments set forth in the First Schedule

hereto being hereinafter referred to as "the Scheduled Property")

4. The section of the proposed roads (including the pedestrian way) coloured

Brown on the plan hereto annexed are hereinafter referred to as "the said road"„.

NOW THIS DEED WITNESSETH that the Vendor in consideration of the

sum of ONE HUNDRED AND EIGHTY THOUSAND POUNDS (i180,000.00) to

09/10796 11 11t55 ORDINARY FEE X394,00

83

the Vendor now paid by the Purchaser (the receipt whereof is hereby acknowledged)

DOTH HEREBY grant bargain and forever absolutely sell and convey unto the

Purchaser ALL AND SINGULAR the Scheduled Property WITH all ways waters

watercourses liberties privileges easements rights and advantages whatsoever

appertaining to the Scheduled Property or any part thereof or used occupied or

enjoyed therewith or reputed or known as part or parcel thereof or appurtenant thereto

AND IN PARTICULAR so far as they may relate to the Scheduled Property with the

benefit of those contained in (a) the Isle of Man Produce Conveyance and (b) those

granted in the Second Schedule hereto EXCEPTING AND RESERVING in fee

simple unto the owner or owners for the time to time of the land intended to be

benefited thereby the rights specified in the Third Schedule hereto TO HAVE and

TO HOLD the same unto the Purchaser in fee simple from this date absolutely and

forever BUT SUBJECT NEVERTHELESS to and with the benefit of all covenants

conditions agreements and stipulations affecting the Scheduled Property and

contained or referred to in any prior Deed of Conveyance or other instrument of title

duly recorded in the General Registry AND IN PARTICULAR subject to those

contained or referred to in (i) the Isle of Man Produce Conveyance and (ii) the Fourth

Schedule hereto so far forth as the same are now validly subsisting and capable of

being enforced AND SUBJECT ALSO to all easements legally existing thereover

AND IN PARTICULAR to those reserved in (i) the Isle of Man Produce

Conveyance and (ii) the Third Schedule hereto...

5. For the benefit and protection of the land comprised in the KIVICHA Estate or

any part or parts thereof other than the Scheduled Property and so as to bind so far as

may be the Scheduled Property unto whosoever hands the same may come the

Purchaser HEREBY COVENANTS with the Vendor that the Purchaser and those

deriving title from the Purchaser will at all times hereafter observe and perform the

stipulations set out in the Fourth Schedule hereto...

6. The Vendor HEREBY reserves the right to modify waive or release any

restrictions or stipulations relating to the Scheduled Property or to adjoining or

neighbouring land whether imposed or entered into before or at the same time as or

after the date hereof and whether they are the same as the restrictions and stipulations

in the Fourth Schedule hereto or not and notwithstanding that such adjoining or

neighbouring land forms part of the KMCFIA Estate including any restrictions and

stipulations which may become binding on the Vendor by virtue of this Deed and the

2

84

right to modify waive or release hereby reserved shall be exercisable by the Vendor

and those deriving title under it to the KMCHA Estate or any part or parts thereof

except that in the case of those so deriving title by conveyance on sale the said right

shall be exercised only by those to whom it is expressly assigned and nothing

contained in this Deed contained shall create or be deemed to create a building

scheme affecting the whole or any part of the KMCHA Estate...

The Vendor DOTH HEREBY covenant with the Purchaser that the Vendor will

at its own sole cost and expense and as soon as it is reasonably practicable so to do

level form metal make and complete the said road and any pedestrian walks or ways

connecting with the said road to a state fit for carts carriages and motor cars and other

vehicles and the pedestrian walks and ways fit for pedestrian traffic thereon together

with all services and drains thereunder for the use and proper enjoyment of the

retained hereditaments and premises part of the KMCHA Estate and the Scheduled

Property. „

The Purchaser (with the object and intention of affording to the Vendor a full and

sufficient indemnity in respect of the prior covenants but not further or otherwise)

DOTH HEREBY covenant with the Vendor that the Purchaser will at all times

hereafter observe per-form and be bound by the prior covenants and those contained in

the Fourth Schedule hereto and will keep the Vendor indemnified against all actions

suits proceedings costs damages claims demands and liability in respect of any breach

thereof arising after the date hereof...

The Vendor DOTH HEREBY further covenant with the Purchaser that the Vendor

hath good right full power and lawful authority to grant bargain sell and convey the

Scheduled Property in manner aforesaid and that it shall and will warrant maintain

uphold and defend the same unto the Purchaser FREE FROM ENCUMBRANCES

and from and against the claim challenge and demand of all and every persons and

person whomsoever...

IN WITNESS WHEREOF the parties hereto have executed these presents this

the day month and year first before written...


ALL AND SINGULAR those parcels of land part of the KMCHA Estate in

the Village District and Parish of Michael the same being represented (for the purpose

of identification only and not of limitation) on the plan hereto annexed by the portions

3

85

delineated and edged Red and hatched Pink and to which said hereditaments the

Vendor became entitled (inter alia) by the Isle of Man Produce Conveyance...

SECOND SCHEDULE WITHIN REFERRED TO

Description of Rights Conveyed

1. The right to use for all normal purposes connected with the Scheduled

Property in common with the Vendor and all other persons now or

thereafter entitled to the like right the drains sewers pipes wires and

cables on over or under the KMCHA Estate with the right to enter

thereon for the purposes of the repair and maintenance of the same

subject to making good all damage caused thereby...

2. A right of way for all purposes for the Purchaser and its successors in

title in common with all other persons having a like right to pass and

repass (with or without vehicles) over the said road...

THIRD SCHEDULE WITHIN REFERRED T

Description of Rights Excepted or Reserved

Any easement or right of light or air now subsisting or which might

(but for this exception) be acquired over any part of the KMCHA

Estate to the intent that the Vendor and its successors in title and those

authorised by any of them may build or rebuild over the same in such

manner as they think fit notwithstanding any interference with the

access of light or air to the Scheduled Property,..

2. The right for the Vendor and the owners and occupiers of any part of

the KMCHA Estate and those authorised by any of them to use all

drains sewers watercourses pipes cables and wires now existing or

which shall hereafter be made or exist within the period of eighty years

from the date hereof (which shall be the perpetuity period applicable

hereto) on over or under the roads and footpaths comprising the

Scheduled Property and the right (but within such period) to enter upon

and lay in the roads and footpaths comprising the Scheduled Property

any such as may be reasonably required for the use of any part of the

KMCHA Estate or such neighbouring lands and to enter upon the

roads and footpaths comprising the Scheduled Property for the repair

maintenance and renewal of the same making good all damage caused

thereby...

4

86

3. A right of way for all purposes for the Vendor and its successors in

title to the whole or any part of the KMCHA Estate or the

neighbouring lands and all other persons having a like right to pass and

repass with or without vehicles over the said road...

4. The right of support necessary for the proper enjoyment of the

adjoining lands and all other buildings and boundary structures erected

thereon and the right of entry to the extent necessary for the purpose of

maintaining repairing and replacing any such buildings or boundary

structures by making good any damage done in the exercise of such

right or entry...

FOURTH SCHEDULE WITHIN REFERRED TO

No building or structure shall be erected placed or permitted to stand

on the Scheduled Property other than a maximum of fourteen (14)

semi-detached dwellings being private dwellings with or without

private garages and/or greenhouses conducive to the development of

the Scheduled Property as Sheltered Accommodation and as shall be

required and/or approved by the appropriate Planning and Bye-Law

Authorities without the consent in writing of the Vendor first had and

obtained...

2. Not to erect any further buildings temporary or otherwise upon the

Scheduled Property or make any alterations to the external appearance

of the dwelling house and garage erected on the Scheduled Property

without the prior written consent of the Vendor and not to alter the

colour scheme of the exterior of the building on the Scheduled

Property without the prior written consent of the Vendor...

3. No signboard hoarding plaque or other advertisement (other than a

board of a reasonable size announcing that the property is to be let or

sold) shall be placed upon the Scheduled Property...

4. Any dwelling house or premises erected on the Scheduled Property

shall be used as a private dwelling house only as Sheltered

Accommodation and no trade or business of any kind shall at any time

be carried on upon the Scheduled Property or any part thereof or in or

upon any building or other erection erected thereon...

1.

S

87

5. No caravan or house-on-wheels or other movable dwelling or structure

designed or adapted for the purpose of human habitation shall be

erected parked placed or allowed to remain or be used upon any part of

the Scheduled Property and in no circumstances whatsoever shall any

caravan house-on-wheels or other moveable dwelling or structure or

any other temporary building of any kind whatsoever be used for

human habitation on any part of the Scheduled Property,.,

6, Not to use any part of the Scheduled Property not built upon for any

purpose other than any private gardens including driveways and

footpaths...

7. Except for domestic pets no poultry pigeons rabbits or any other

animals whatsoever shall at any time be kept or allowed to remain on

the Scheduled Property...

8, The Purchaser shall not obstruct the said road thereof in any manner

nor disturb the surface thereon except for the purpose of making

connections to the sewers drains and mains thereunder. Any such

disturbance shall be made good by the Purchaser with all due

despatch, .,

9. Nothing shall be done or permitted to be done on the Scheduled

Property or any part thereof which shall be or become or cause a

nuisance annoyance damage or any inconvenience to the Vendor or

neighbouring owners or occupiers of premises part of the KMCHA

Estate...

10. Not to impede access to the hereditaments retained by the Vendor

(hereinafter referred to as "the Retained Land") and to keep the roads

and footpaths thereof free from all obstructions which would frustrate

the exercise of the right of way reserved herein in favour of the Vendor

and to use reasonable endeavours to keep the roads both constructed

and to be constructed on the Scheduled Property and all roads now or

hereafter constructed on the Scheduled Property providing access to

and egress from the Scheduled Property and the Retained Land free

from mud clay lime or other materials adhering to the wheels or tracks

or other parts of any vehicle gaining access to the Scheduled Property

6

88

In this clause "vehicle" includes any trailer or any implement or

machine

IL

To afford access to the Scheduled Property at all times to the Drainage

and other Authorities or companies or bodies responsible for the

supply of mains or ancillary services (hereinafter called "the Service

Authorities") their servants and agents to carry out maintenance to the

foul sewers and drains pipes wires and cables and in the event of

emergency without notice„.

12. Not to seek compensation for damage to crops flowers or bushes

occasioned by the Service Authorities their servants and agents whilst

gaining access to or exposing the foul sewers arid drains pipes wires

and cables...

13. Not to excavate the Scheduled Property for any purpose more than 460

mm below ground level on the line of the foul sewers and drains pipes

wires and cables without prior permission of the relevant Service

Authority...

14. No commercial vehicle or van of any description shall be parked

placed or allowed to remain upon the Scheduled Property other than

inside any garage forming part of the Scheduled Property and no

commercial vehicle or van of any description belonging to or under the

control of any person residing at the Scheduled Property shall be

parked placed or allowed to stand upon any roadway forming part of

the KMCHA Estate...

15. Upon completion of the development by the Purchaser of the

Scheduled Property or at any prior time that may be requisite to

arrange the cleansing and jetting of all foul and surface water drains

laid under the Scheduled Property to ensure the proper use thereof to

be made available for the benefit of the Retained Land and further if so

required to facilitate the adoption of all or any roads and footpaths

sewers and drains construction on over or under any part or parts

thereof and will forthwith on demand by the Vendor together with all

others entitled to share the use thereof pay a due and proper proportion

according to user of the cost incurred by the Vendor in cleansing and

jetting out all or any foul and/or surface water drains serving the

7

89

(-7 cAz _c

D,QC C.-70<Z

Retained Land as may be required by and to the satisfaction of the

appropriate Statutory Authorities...

EXECUTED by the Vendor in the presence of:-

EXECUTED by the Purchaser in the presence of:- iatcl, &L i

VAAANA....44 t N61

45) ff N) 03\) ti

cf,`Z.

'1AAN r-10,f.z-, &h,1„),

kirlonea

8

90

Appendix 5

THIS DEED made this ,5 II, day of CC,_—TO

One thousand

nine hundred and ninety nine (1999) BETWEEN PARKINSON LIMITED a Company

incorporated in the Isle of Man and having its•Registered Office situate at Parkinson

House Peel Road in the Parish of Braddan (hereinafter referred to as "the Vendor" which

expression unless inconsistent with the context shall include its successors and assigns)

of the one part KEITH OGDEN HURD and THORA HURD his wife both of 38 Saddle

Mews in the Borough of Douglas (hereinafter referred to as "the Purchasers" which

expression unless inconsistent with the context shall include the said Keith Ogden and

Thorn Hurd the executors and administrators of such survivor that his or her assigns) of

the other part._

WHEREAS :-

I. The Vendor is well entitled to seised and possessed in fee simple of ALL AND

SINGULAR certain hereditaments part of the Whitehouse Estate In the Village

District and Parish of Michael purchased by the Vendor by Deed of Conveyance

(hereinafter called "the Parkinson Conveyance") bearing date the 17' day of

February 1998 from Kirk Michael Community Housing Association (the said

parcels of land purchased by the Vendor being hereinafter together referred to as

"the Parkinson Estate")

2, The Vendor has prepared plans for laying out the Parkinson Estate as a building

estate and the plan hereto annexed shows part of the layout thereof including

certain proposed roads and footpaths delineated and coloured green on the said

plan...

3. The Vendor has agreed to sell to the Purchasers the hereditaments and premises

more particularly described and set forth in the First Schedule hereto upon the

terms and conditions hereinafter appearing (the said hereditaments set forth in

the First Schedule hereto being hereinafter referred to as "the Scheduled

Property")

93

10:

4. The section of the proposed roads (including the pedestrian way) coloured green

on the plan hereto annexed are hereinafter referred to as the said road".,,

NOW THIS DEED WITNESSETH that the Vendor in consideration of the sum of

SEVENTY TWO THOUSAND POUNDS ( ✓ 72,000.00} to the Vendor now paid by the

Purchasers (the receipt whereof is hereby acknowledged) DOTH HEREBY grant bargain

and forever absolutely sell and convey unto the Purchasers ALL AND SINGULAR the

Scheduled Property WITH all ways waters watercourses liberties privileges easements

rights and advantages whatsoever appertaining to the Scheduled Property or any part or

parcel thereof or appurtenant thereto AND IN PARTICULAR so far as they may relate to

the Scheduled Property with the benefit of those contained in (a) a Deed of Conveyance

lhereinafter called "the Isle of Man Produce Conveyance") bearing date the 20th day of

October 1997 from Isle of Man Produce Company Limited to Kirk Michael Community

Housing Association (b) the Parkinson Conveyance and (c) those granted in the Second

Schedule hereto EXCEPTING AND RESERVING in fee simple unto the owner or owners

for the time to time of the and intended to be benefited thereby the rights specified in

the Third Schedule hereto TO HAVE AND TO HOLD the same unto the Purchasers in fee

simple as joint tenants and not as tenants in common from this date absolutely and

forever BUT SUBJECT NEVERTHELESS to and with the benefit of all covenants

conditions agreements and stipulations affecting the Scheduled Property and contained

or referred to in any prior Deed of Conveyance or other instrument of title duly recorded

in the General Registry AND IN PARTICULAR to those contained or referred to in (i) the

Isle of Man Produce Conveyance (ii) the Parkinson Conveyance and (iii) the Fourth

Schedule hereto so far forth as the same are now validly subsisting and capable of being

enforced AND SUBJECT ALSO to all easements legally existing thereover AND IN

PARTICULAR those reserved and contained in (i) the Isle of Man Produce Conveyance (ii)

the Parkinson Conveygnce and (iii) the Third Schedule hereto...

5. For the benefit and protection of the land comprised in the Parkinson Estate or

any part or parts thereof other than the Scheduled Property and so as to bind so

94

far as may be the Scheduled Property unto whosesoever hands the same may

come the Purchasers HEREBY COVENANT with the Vendor that the Purchasers

and those deriving title from the Purchasers will at all times hereafter observe

and perform the stipulations set out in the Fourth Schedule hereto...

6. The Vendor HEREBY reserves the right to modify waive or release any

restrictions or stipulations relating to the Scheduled Property or adjoining or

neighbouring land whether imposed or entered into before or at the same time as

or after the date hereof and whether they are the same as the restrictions and

stipulations in the Fourth Schedule hereto or not and notwithstanding that such

adjoining or neighbouring land forms part of the Parkinson Estate including any

restrictions and stipulations which may become binding on the Vendor by virtue

of this Deed and the right to modify waive or release hereby reserved shall be

exercised by the Vendor and those deriving title under it to the Parkinson Estate

or any part or parts thereof except that in the case of those deriving title under it

to the Parkinson Estate or any pert or parts thereof shall be exercised only by

those to whom it is expressly assigned and nothing contained in this Deed shall

create or be deemed to create a building scheme affecting the whole or any part

of the Parkinson Estate...

7. The Vendor 00TH HEREBY covenant with the Purchasers that the Vendor will at

its own sole cost and expense and as soon as it is reasonably practicable so to

do level form metal make and complete the said road and any pedestrian walks

Or ways connecting with the said road to a state fit for carts carriages and motor

cars and other vehicles and the pedestrian walks and ways fit for pedestrian

traffic thereon together with all services and drains thereunder for the use and

proper enjoyment of the retained heredftaments and premises part of the

Parkinson Estate and the Scheduled Property...

8, The Purchasers 'with the object and intention ''‘of affording to the Vendor a fUll

and sufficient indemnity in respect of the prior covenants but not further or

95

otherwise) DO HEREBY covenant with the Vendor that the Purchasers will at all

times hereafter observe perform and be bound by the prior covenants insofar as

the same relate to the Scheduled Property and those contained in the Fourth

Schedule hereto and will keep the Vendor indemnified against all actions suits

proceedings costs damages claims demands and liability in respect of any breach

thereof arising after the date hereof...

9, The Vendor DOTH HEREBY covenant with the Purchasers that the Vendor 'lath

good right full power and lawful authority to grant bargain sell and convey the

Scheduled Property in manner aforesaid and that it shall and will warrant

maintain uphold and defend the same unto the Purchasers FREE FROM

ENCUMBRANCES and from and against the claim challenge and demand of all

and every persons and person whomsoever...

IN WITNESS WHEREOF the parties hereto have executed these presents this day month

and year first before written...


A certain plot of land part of the Whitehouse Estate situate abutting upon a new

roadway leading off and lying to the South side of the main highroad leading from

Ramsey to Kirk Michael in the Local Government District and Parish of Michael the same

being represented (for the purpose of identification only and not of limitation) on the plan

hereto annexed by the portion delineated and edged pink and numbered 27 (formerly plot

61" and to which said hereditarnents the Vendor became entitled (inter alia) by the

Parkinson Conveyance TOGETHER WITH the semi-detached dwelling house and all other

buildings now thereon erected numbered and known as 27 Carman Court, Kirk Michael,"

SECOND SCHEDULE WITHIN REFERRED TO

The right to use for all normal purposes connected with the Scheduled Property

in common with the Vendor and all other persons hereafter entitled to the like

right the drains sewers pipes wires and cables on over or under the Parkinson

96

Estate with the right to enter thereon for the purposes of the repair and

maintenance of the same subject to making good all damage caused thereby_

2. A right of way for all purposes and at' ail times for the Purchasers and their

successors in title in common with all other persons having a like right to pass

and repass (with or without vehicles) over the said road

3. The right of support necessary for the proper enjoyment of the Scheduled

Property and all buildings and boundary structures erected thereon and the right

of entry on to the adjoining lands part of the Parkinson Estate to the extent

necessary for the purpose of maintaining repairing and replacing any such

buildings or boundary structures but making good any damage in the exercise of

such rights

THIRD SCHEDULE WITHIN REFERRED TO

Description of Rights Excepted or Reserved

Any easement or right of light or air now subsisting or which might (but for this

exception) be acquired over any part of the Parkinson Estate to the intent that

the Vendor and its successors in title and those authorised by any of them may

build or rebuild over the same in such manner as they think fit notwithstanding

any interference with the access of light or air to the Scheduled Property...

2. The right for the Vendor and the owners and occupiers of any part of the

Parkinson Estate or the neighbouring lands and those authorised by any of them ti

to use all drains sewers watercourses pipes cables and wires now existing or

which shall hereafter be made or exist within the period of eighty years from the

date hereof (which shall be the perpetuity period applicable hereto) on over or

under the Scheduled Property and the right (but within such period) to enter upon

and lay in the Scheduled Property any such as may be reasonably required for the

use of any part of the Parkinson Estate or such neighbouring lands and to enter

upon the Scheduled Property for the repair maintenance and renewal of the same

making good all damage caused thereby...

97

A right of way for all purposes for the Vendor and its successors in title to the

whole or any part of the Parkinson Estate and all other persons having a like right

to pass and repass with or without vehicles over the said road and on foot over

the footpaths thereof...

The right of support necessary for the proper enjoyment of the adjoining lands

and all other buildings and boundary structures erected thereon and the right of

entry to the extent necessary for the purpose of maintaining repairing and

replacing any such buildings or boundary structures but making good any damage

done in the exercise of such rights...

4.

FOURTH SCHEDULE WITHiN REFERRED TO

1. No building or structure shall be erected placed or permitted to stand on the

Scheduled Property other than one dwelling being a private dwelling with or

without private garage and/or greenhouse conducive to the development of the

Parkinson Estate as Sheltered Accommodation and as shall he required and/or

approved by the appropriate Planning and Bye-Law Authorities without the

consent in writing of the Vendor first had and obtained...

2. Not to erect any further buildings temporary or otherwise upon the Scheduled

Property or make any alterations to the external appearance of the dwelling

house and garage erected on the Scheduled Property without the prior written

consent of the Vendor and not to alter the colour scheme of the exterior of the

building on the Scheduled Property without the prior written consent of the

Vendor...

3, No signboard hoarding plaque or other advertisement father than a board of

reasonable size announcing that the property is to be let or sold) shall be placed

upon the Scheduled Property

4. Any dwelling house or premises erected on t-he Scheduled Property shall be used ''z

as a private dwelling house only as Sheltered Accommodation and no trade or

98

business of any kind shall at any time be carried on upon the Scheduled Property

or any part thereof or in or upon any building or other erection thereon.„

E. No caravan or house-on-wheels or other movable dwelling or structure designed

or adapted for the purposes of human habitation shall be erected parked placed

or allowed to remain or be used upon any part of the Scheduled Property and in

no circumstance whatsoever shall any caravan house-on-wheels or other

moveable dwelling or structure or any other temporary building of any kind

whatsoever be used for human habitation on any part of the Scheduled

Property...

6, Not to use any part of the Scheduled Property not built upon for any purpose

other than any private garden including driveways and footpaths„.

7. Except for domestic pets no poultry pigeons rabbits or any other animals

whatsoever shall at any time be kept cr allowed to remain on the Scheduled

Property...

8, The Purchasers shall not obstruct the said road or the footpaths thereof in any

manner nor disturb the surface thereon except for the purpose of making

connections to the sewers drains and mains thereunder any such disturbance

shall be made good by the Purchasers with all due despatch...

9. Nothing shall be done or permitted to be done on the Scheduled Property or any

part thereof which shall be or become or cause a nuisance annoyance damage or

inconvenience to the Vendor or neighbouring owners or occupiers of premises

part of the Parkinson Estate...

10, To afford access to the Scheduled Property at all times to the Drainage and other

Authorities or companies or bodies responsible for the supply of mains or

ancillary services (hereinafter called "the Service Authorities") their servants and

agents to carry out maintenance to the foul sewers and drains pipes wires and

cables and in the event of emergency without notice...

99

Not to seek compensation for damage to crops flowers or bushes occasioned by

the Service Authorities their servants and agents whilst gaining access to or

exposing the foul sewers and drains pipes wires and cables_

12. Not to excavate the Scheduled Property for arty purpose more than 460 mm

below ground level on the line of the foul sewers and drains pipes wires and

cables without prior permission of the relevant Service Authority_

'13, No commercial vehicle or van of any description shall be parked placed or

allowed to remain upon the Scheduled Property other than inside any garage

forming part of the Scheduled Property and no commercial vehicle or van of any

description belonging to or under the control of any person residing at the

Scheduled Property shall be parked placed or allowed to stand upon any roadway

forming part of the Parkinson Estate...

EXECUTED by the Vendor in the presence of _.../ :-

V 2 /0/7 AtZ/

/sr 6;1,1;46

Z}G,,

DIRECTOR

SECRETARY

SIGNED and DELIVERED by the Purchasers in the presence of

St 63, LAA

SHIRLEY BA t.DW1N RIDGEWP,v -IOUSE RIDGEW,=, STREET DOUGLA;3 ISLE OF Nk;,N ADVOCATES CLERK

100

101

I{ •

if'

N

Appendix 6

Dated

0 teeeiwbv

1998

Parish of Michael

Kirk Michael Community Housing Association the Grantor" of the one part...

and

CYRIL RENSHAW and JEAN DOROTHY RENSHAW "the Grantee" of the other part...

HOUSING ASSOCIATION MAINTENANCE AGREEMENT

12 Cannon Court Kirk Michael

Morris Maddrell Advocates 87 Parliament Street Ramsey

103

THIS DEED made this 10"' clay of December One thousand nine hundred and ninety eight

(1998) BETWEEN KIRK MICHAEL COMMUNITY HOUSING ASSOCIATION a charitable

Company Limited by Guarantee and having its registered Office situate at White Gables

Curragh Road in the Parish of Balleugh (hereinafter referred to as "the Grantor" which

expression unless inconsistent with the context shall include its successors and 'assigns)

of the one part and CYRIL RENSHAW and JEAN DOROTHY RENSHAW his wife both of

White Holm Main Road in the Village District and Parish of Michael (hereinafter referred

to as "the Grantees" which expression unless inconsistent with the context shall include

the survivor of them and administrators of such survivor their his or hers assigns) of the

other part,—

1. WHEREAS:-

1) By Deed of Conveyance bearing data the 17'1' clay of February 1998 the Grantor

did sell and convey unto Parkinson Limited ALL AND SINGULAR certain

hereditaments part of the Whitehouse Estate in the Village District and Parish of

Michael the same being more particularly set forth and described in the said Deed

of Conveyance (hereinafter referred to as "the Parkinson Estate"),,,

2) By Deed of Conveyance bearing date the 1 k tikclay of December 1998 the said

Parkinson Limited did sell and convey unto the Grantees ALL AND SINGULAR

that plot of land part of the Whitehouse Estate Michael aforesaid TOGETHER

with the dwelling house and all other buildings thereon erected which said

hereclitaments and premises are more particularly set forth and described in the

First Schedule thereto (hereinafter referred to as "the Premises")...

31 It was a term of the aforesaid Deeds of Conveyance dated the 171'' day of

February 1998 and the I

day of December 1998 that these presents be

entered into by the Purchasers of the Units erected on the Parkinson Estate,..

4) The Grantor has agreed to provide certain facilities to the Grantees as hereinafter

described and the Grantees have agreed to enter into these

104

5) presents and accept such facilities upon the terms and conditions hereinafter

appearing...

2. NOW THIS DEED THEREFORE WITNESSETH that in pursuance of the said

Agreement and in consideration of the sum of TWENTY FIVE POUNDS (1:25.00)

now paid by the Grantees (the receipt whereof acknowledged) and of the rents

and the covenants hereinafter reserved and contained and on the Grantees' part

to be paid observed and performed the Grantor LOTH HEREBY grant to the

Grantees as follows:•

(a) full right and liberty at all times hereafter to use and enjoy without let or

hindrance the communal facilities in the Apartment Block erected on the

hereditan-sents retained by the Grantor (hereinafter referred to "the

Apartment Block") PROVIDED ALWAYS that any damage occasioned in

the exercise if such right is rectified to the satisfaction of the Grantor and

(13) to use in the case of an emergency the telephone and it system

installed in the premises to notify the Warden residing in the Apartment

Block of such emergency...

3. AND the Grantor in consideration of the covenant with the Grantees as follows :-

(a) to keep the communal facilities in the apartment Block in good and

substantial repair and condition,„

(b) to keep the gardens of the premises and all other premises part of the

KMCHA Estate as aforesaid tidy and properly mowed and cut free from

weeds and

(0) to paint the outside walls and exterior woodwork (including window

frames, doors and fascia boards) of the premises once in every three-year

cycle. The colour and materials of which are at the sole discretion of the

Grantor providing that any proposed change of colour shall be made only

with agreement of all the relevant owners...

105

4. AND the Grantees in consideration of the covenants and rights granted by the

Grantor to the Grantees by these presents 00TH HEREBY covenant with the

Grantor as follows:-

(a) To pay to the Grantor on a week to week basis in advance the sum of

TWENTY FIVE POUNDS #E25.00) without deduction or delay for a period

of ONE YEAR and thereafter such sum is to increase consistent with the

rate of inflation the first of such payments to be made by the Grantees at

the date hereof,..

(hi to keep in good and substantial repair and condition the demised

premises save as a foresa d...

(01 to pay all sums as shall be necessary for the supply of electricity water

and any other services supplied to the premises and also all charges

incurred by the installation and use of a telephone and intercom system

and any servicing thereof at the premises to the Warden residing in the

Apartment Block...

(d) riot without the previous licence or consent in writing of the Grantor to

make or allow to be made any structural alterations in the plan elevation

or appearance of the premises or to make any addition thereto...

le) to perform and observe such reasonable rules and regulations as the

Grantor may from time to time prescribe by agreement with the Grantees

in connection with the Apartment Block

ff) not to carry on or allowed to be carried on in or from the premises any

trade or business whatsoever but to keep the same strictly as a private

sheltered residence nor do or suffer to be done in or on the premises or

any part thereof any act or thing which may be or become and nuisance

or annoyance injury damage or disturbance to the Grantor to the tenants

or occupiers of any other property in the neighbourhood...

(g) not to keep any animal or bird on the premises unless kept strict control

so as not to become a nuisance or annoyance to adjoining tenants or

106

occupiers of the Grantor and not to permit such animal or bird to foul any

part of the Parkinson Estate...

(h) not to place or suffer to be placed or retained on any part of the premises

any placard or advertisement or to exhibit any signboard plate or other

contrivance without the written consent of the Grantor being first had

and obtained,.,

(i) not at any time sell convey or part with possession of the premises or

any part thereof without the previous consent in writing of the Grantor

such consent not to be withheld SUBJECT to the following conditions on

the part of the Grantees being observed...

(a.) the payment in full of all arrears of Service Charge...

(b.) the payment of all legal fees incurred by the Grantor in respect of

the approval by the Advocates of the Grantor of any Conveyance

of the premises_

(e.) the compliance by the Grantees of all the covenants terms and

conditions on the part of the Grantee herein to be observed and

performed...

fd.) that any Purchaser purchasing the premises or receiving the

beneficial interest thereof shall acknowledge the requirement to

make a payment under the terms of Clause 4a) hereof

IN WITNESS WHEREOF the Grantor and the Grantees have executed these presents this

the day month and year first before written„.

EXECUTED by the Grantor

in the presence of

_ Ct./L./L,

EXECUTED by the

Grantee in the pr .senfie of :

Nt)(Wm...L.\ ? ,,v...tv l,----..st),)NciA,

v...t.t..v. t•-i.....,K.A.A.,.",...

107

Appenaix7

,„-zk 4 (. -.("4/

Y , ((et, C . /%4

1 r/

My dispute with KMCHA is twofold and is as follows:

1. Property I purchased as Sheltered Housing in November 2007, with the care of a warden available, is no longer deemed to be Sheltered by Mr. U. Cannan and the Management Committee of KMCI--IA.

2. I am paying part of the salary of a warden whose services have been denied me since Sept: 2009.

The detail and chronology

1. I purchased 28 Cannan Court in November 2007 on the understanding that the property was part of a Sheltered Housing Complex. Documents, part of the conveyencing papers, plans, search documents etc confirmed my understanding.

2. I signed a Maintenance Agreement with KMCHA, which required a monthly payment, this stands at E149.I.5 per month at present, in return for certain services, namely:-

a) grass cutting b) carephone service c) tri-annual painting of the house exterior,

3. On May 7th 2009 I received a letter from KMCHA (copy enclosed) summoning me to a meeting to discuss the shortfall in finances --- the cost of painting the bungalows was stated to be the reason for this deficiency in funds (see pare 3). Paragraph 6 of this letter proposed an increase of E.8.00 per week E416.00 per annum commencing .I.5t July 2009 to offset the shortfall.

4, May 27th 2009 I attended the meeting with KMCHA (copy of Minutes taken by the Administrator attached).

June 2nd 2009 I received a letter from KMCHA (copy attached) I draw your attention to paragraph z-tb, relating to the external decoration of the bungalows.

6. June 4th 2009. A letter written by Mr. C. Renshaw on behalf of the bungalow owners was sent to KMCHA (copy attached).

7, August 5th 2009. A letter from Corlett & Bolton was received by Mr Renshaw, who as previously stated represents the bungalow residents (copy attached). In para 6 page 2 of this letter I note for the first time a reference to the maintenance charge calculated on a 40/60% basis and relates in particular to the warden services. I ask the Select Committee to look at para 7, 8 & 9 of this letter. The proposal of £3.35 per week or E179.00 per year, and house painting on a 6 yearly base was mentioned. No discussion with KMCHA and the bungalow residents followed.

8. August 10th 2009. Residents of the bungalows reject the proposal and inform KMCFIA accordingly.

9. September 8th 2009, A letter from Corlett and Bolton received stating that the warden's visits will cease on Sept 28th 2009.

109

2

:la October 13th 2009, Mr Renshaw receives details of expenditure from KMCHA. The breakdown is as follows:-

INCOME £20,135.00

Grass cutting £2,389.00 Carephone £1,020,00 Setaside money for tri-annual painting £3,208.00

TOTAL 0_,.617.00

The sum of £13,518.00 is being paid to KMCHA by the bungalow residents for salaries and upkeep of public rooms, We receive no service from the warden whose salary we subsidise, and for the upkeep of public rooms to which we have no use.

11, In an attempt to "clear the air" and resolve matters I met Mr David Carman and the Administrator in Dec 2009 in his office in Carman Court. To no avail.

A?

I contacted a member of the Management Committee, Mrs Marilyn Cannell also in Dec 2009 by telephone, she was unable to meet or talk on this matter because of heavy commitments.

I spoke to Clare Foulds regarding the caveat sent to Mr and Mrs Renshaw, she was unable to help.

The stress and anxiety endured by myself and the other bungalow residents over the last 18 months has been considerable. We are all elderly and not in robust health.

In spite of attempts to talk to and explain the points of view, the Chairman and the other members of the Committee, have, I feel been almost indifferent, I fail to understand how an organisation such as KMCHA, which purports to be concerned about the welfare of elderly people have failed in its duty of care, accepting our financial contribution and exhibiting little responsibility.

We Select Committee.

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110

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Re_gistereci Office: .



IM6 1 FA

KIRK MICHAEL COMMUNITY \ HOUSING ASSOCIATION

Telephone/Fax: (01624) 878193

4

7th May, 2009 c / j

Mrs. M. Mack'Linen, 28 Carman Court, KIRK MICHAN„ Isle of Man.

D 11 4 t ,-t ear p. 4 i

re: BUNGALOW MAINTENANCE ACCOUNT

Enclosed is the Bungalow Maintenance Account for the year 2008 and you will recall that your bungalow had external decoration during the year.

You will notice on the accounts that the income; from the present maintenance agreement is

£20,135pa and expenditure on the day-to-day services (exekiding the charge for the use of public rooms) is £20, l22.

In summary the income meets the day-today services but is insufficient now to provide for the three yearly external decoration costs which have been in the past paid out. of contingencies. flow-ever.; ithe.::COA 6f the external decoration can no totipt be funded from this

Since 1998 when the maintenance charge under the Agreement was established, the inflationary costs have been greater than the annual increases in the maintenam4arge. The cost of external decoration in 2002 was within the maintenance budget. .14 2005:y1'10re was a shortfall of £3,065 and in 2008 the shortfall was £9,623 making a totarSTiortfall in the bungalow maintenance account of £13,999,

Therefore it is necessary to increase the basic rate of the maintenance agreement, charge. As the maintenance agreement is a legal document the change in the basic rate can only he achieved by the written consent of all the bungalow residents or alternatively by application to the Court.

(.) [le prop:ose:Ofig4qa c.qtacoolatigi :1St 'July, 2009.

The bungalows are due fbi' repainting in 2011 and this proposed increase will provide £1,040 per bungalow (total £12,480) to 31st December 2011. The cost of decoration in 2008 was £9,623 or £802 per bungalow. The provisional estimate for decoration in 2011 is £10,585 Of

£882 per bungalow.

The surplus (£12,480 - £10,585 = £1,895) will assist in reducing the overall deficit of £13,999.

a To discuss this matter you are invited to a meeting in the lounge at Cannan Court on 1' Wednesday 27th May at 7.30pm. Present at the meeting will be the Management Committee

together with Mr. M. Gardner B.A., formerly senior partner, KPM0 and Ms. S. Bolton, Senior Partner, Corlett Bolton Advocates.

I do hope you will be able to attend this meeting.

Yours sincerely,

DAVID CANNAN


Chairman: David Carman, M.H.K. Company Limited by Guarantee

Warden: Mrs. J. Woods



112

•8'

MINUTES OF A MEETING eE'rWEEN KIRK MICHAEL COMMUNITY ROUSING ASSOCIATION MANAGEWENT COMMITTEE

AND BUNGALOW RESIDENTs / REPRESENTATIY F,S 171101VA CANNAN COURT

HEW A T CANNAN COURT ON

WEDNESDAY 27 MAY 20009 AT 7.39Pm

Present: Mrs Arm Barron (A13) (Minutes) Mr Trevor 13ougard (TB) Mr David Carman, MHK (DC) (Chairman) Mrs Marilyn Cannel! (MC) Mrs Phil Cashin (PC) Mr Peter Clegue (PC) Mr Peter Hayes (PH)

In Attendance; Ms Sally Bolton (SB) - Advocate Representing the Management COMInittee

Mr Mike Gardner (MG) — Accountant, Representing the Management Committee

Bungalow Residents / Representatives — 14 in Total

L Introduction

DC welcomed all present to the meeting, introducing the Management Committee in turn to The Floor, a special introduction being given to S13 and MG.

2. Background

lifahnenance Charge Set originally in 1098 at .E23, DC outlined the services covered within this fee:. 4 Warden on call 2417 e• .0 Grass cutting ▪ Carephone system .0 Use of Public Rooms • Administrative support

External decoration of the properties every 3 years

It was noted that to date the properties have been painted in 1999/2002/2003 and 2008. However in the current economic climate there is a need to review the requirement to continue with the external decoration on the

—current 3 year pattern.

DC advised he had called the meeting to discuss the way forward. Currently scheduled for redecoration in 2011 would require a substantial increase in the Maintenance Charge. This was confirmed by MG.

Options — previously circulated were explained by DC who offered to take Q&As from those present.

Discussion followed covering a range of issues from the benefits of having a warden to that of even considering opting out of the Maintenance Charge. On the latter, SB explained the legal structure around the Charge.

Further discussion from The Floor implied a feeling of an "us and them" atmosphere. Representation from The Floor advised that the residents had held their own meeting prior to this evening. An extract from that meeting was read out to those present. Points covered questioned the tone, (felt to be too harsh) of the original letter sent to the residents from the Association advising of this evenings meeting, purpose of which was to discuss options available to cover the increase cost of external decoration. Following further debate DC replied to the comments made and apologised profusely on behalf of the committee if the letter did appear too harsh that was certainly not the intention.

ay 113

Further questions from The Floor included:-

Q: /ho authorised the painting in 2008? A: Management Committee

Q:What evidence was there of the job being put to tender? A: COpit.'S of tenders are on file

Q: Was there any individual benefit in decision of tender? A: No

Q:2005 — there was a shortfall on reserves to pay fbr the decorating then so why take the gamble even then? A: Year on year committee continue to build on reserve account

Q:Why is there no bungalow representative on the Management Committee? A: The Floor was advised that this was for the Management Committee to discrres in private and revert back on. (Note if admit a representative front the bungalows there will be a requirement to invite one of the tenants from the apartments to sit on the committee)

Dc.: reiterated tllem9§, of the meeting was to agree a way forward for future decoration - irot the funding of the recent deficit as ws3-th_e,,amaretit mood from el' oor.

Following further discussion, the response from The Floor was one of slight change • unanimous, in that the original letter inviting diem to this meeting could have been a lot clearer in its purpose. Again, DC did apologise if It had given any cause for alarm, there was certainly none intended.

DC again emphasised that "a line had been drawn over the past" and the sole. purpose of this evenings meeting was to agree when the bungalows should be net painted,

The Floor questioned whether or. ot they could form a .Residents Association.

Aetion,;(-1 Si3 proposed that the residents meet again collectively, consider the options put Iforward, consider options for rz nt representation and 110 reconvene tent, 5/1th the Management Cortnnt - tothere v as agreement.

Overall, those present agreod that the meeting had given everyone the opportunity to enter into dialogue — which perhaps on reflection bad been long overdue.

Questions from The Floor continued however, questioning why there should be an advocate present. DC explained he had asked professionals from the both the accountancy and legal fields to be present to offer unbiased professional advice on behalf of the Management Committee, rather than them thel he himself was putting forward his own views- The residents however, felt the presence threatening. SD responded that she wan sorry they felt that way, but that was not her style of advocacy ..- she was purely present to offer unbiased professional advice.

In closing both parties did agree it was a shame the meeting "got off on the wrong foot".

The meeting closed at 9,40pm.

Dq,

7

I

114


Registered Mee,:

Carman Court, Main Road,


1M6 1 FA

Mrs. M. MaeMullen, 28 Carman Court, KIRK MtCHAEL„ Isle of Man.

[)ear ,

The trustees of the Kirk Michael Community Housing Association have reviewed the Constitution and decided to establish with effect from lst September, 2009, a separate General Advisory Committee and a separate Executive Committee whose membership will be the existing Management Committee.

The Executive Committee will be responsible for the day to day management of the apartment block and the terms of the Maintenance Agreement with the bungalows.

3, The General Advisory Committee members will be a representative from the bungalows and a representative from the apartment block together with the members of the Executive Committee and will meet from time to time to discuss matters relevant to the bungalow residents and the apartment residents.

Therefore the trustees request that the residents of the bungalows hold a meeting amongst themselves for the following purposes.

a) 'l'o elect or appoint a person as their representative. on the General Advisory Committee.

b) To agree.,a,.,,p01i.2' Naons for change it-a future external decoration of the

bungalp*.;', Copy enclosed.

I t will be helpful if the Management Committee are informed of the outeome of the residents meeting before 15th July, 2009.

115

-2

Again, I offer most sincere apologies for the misunderstanding or upset caused by the letter dated 7th May, 2009.

Yours sincerely,

(

P

--- CLA.A..-A-, e t-A--„ .

DAVID K.ANNAN

cc: Mrs. Joan Woods


Chairman: David Carman, KKK. Company Limited by Guarantee



Clerk/Administrator Mrs. J. Stewart

116

21 Carman Court Main Road Kirk Michael Isle of Man 1M6 1FA

4th June 2009

try .PRESUINCA

The Chairman and Committee Kirk Michael Community Housing Association Carman Court Main Road Kirk Michael Isle of Man IM6 117.A.

Dear Chairman and Committee,

Further to your letter of 7'h May 2009 and the subsequent Meeting on 27th May 2009, we would set out ow feelings on the matter as follows:

We 'would point out that We are under no legal obligation to accept your proposed increase to the Maintenance Charge. This charge is governed by Contracts between the Association and the residents. The Association is responsible for discharging its obligations under those Contrasts, using whatever resources are available to it, including its considerable accumulated reserves. We note indeed that the Association has already agreed that the so-called deficit on the Maintenance Account to•date should be funded .frOTIA those reserves.

The weekty Maintenance Charge is More than adequate to cover the cost of items stipulated in the Maintenance Agreement. 'The Community Housing Association is under no Obligation to refund monies surplus to those required to cover maintenance costs, and this surplus goes to the Association as a donation towards the costs of administering Carman Court.

The cost of maintenance is about one third of tire sum raised by the Weekly Charge and therefore two thirds goes to the Housing Association as a donation to be used for other purposes.

The current Weekly Charge raises approximately £1,800 a year per bungalow, and the current cost of maintenance is approximately £600. This means that the Housing Association is receiving 11,200 this year which., we -feel, is a more than generous contribution to the staffing and administration costs of the Association.

We look forward to hearing from you.

Yours faithfully, ',/

V(4

On Behalf of Bungalow Owners/Residents

117

Oilic Ref: NK/KB/20405.001/K

Direct Dial ---- 699831 Yo Ref: (Secretary)

August 2009

Mr .Renshaw 21 Carman Court Main Road Kirk Michael Isle of Man 1M6 114

CORLETT B00 -LT 0 N

(7) co

11)

Advocates Notaries Public

Commissioners for Oaths

Dear Sirs,

Re: Maintenance Charaes frgl i3tlra falow 01111103•S

( We act for Kirk Michael Community Housing Association ("KMCHA") and we write in response to your letter of el June 2009.

Our client would like us to address the issues raised in your letter in response to the increase in the maintenance charge proposed by the Committee of KMCHA.

KMCHA is a Company limited by guarantee and is also a registered Charity. The Company as a Charity is responsible for the upkeep and maintenance and operation of the apartment block and its various services, many of which are made available to the owners of the bungalows, including the administration and warden services. Some of these services are additional to those basic services provided for in the Deed of Covenant the bungalow owners signed when they purchased their properties.

ti At present accumulated financial reserves for the Charity are raised by volunteers selling teas at TI week and other fundraising events. The Charity should not provide services outside its objects and the funds raised have been used to reduce the Charity's borrowings and for the maintenance of the apartment block. The obligations of the Charity do not extend to the-private contract made between you and thiMiVfetIA:. .. „

We note what you understand to be the current cost for fulfilling the obligations under the maintenance agreement however, our client would like to clarify to you how their proposed figures were reached and. we would advise as follows:-

(..) You will see at clause 2(b) of the maintenance agreement that residents of the bungalows are permitted "to use in the case of emergency the telephone and intercom system installed in the premises to notify the warden residing in the apartment block of such emergency". As you ✓ will aware„the,,residents of _ the bungalows: including a visit from the warden once a day and attencliiiiffie pr firer ..ies-s anyone

,recluire"the Waiden's assistance. The warden service is available 21 h64S'ado., the 3 hour ,4•• • " 4, Finch Road, 1::,luglas, Isle: cif isrLin, 1N11 2PT British Isles

Partner: MI Bolton Consultant: J ICarriin Associate ikflvocittc: N Kaniewski

Telephone: 4.44 (0) 1624 6761368 Facsitnk: +44 (0) 1624 6715966 Email: gl:WiiiiorljatkolmxsittA Web: ,,vww.corlatiboltori.coiti

VAT Regiatritilon: 00i 04% 56

118

) / 4 7

rest period is covered by a Carephone system. These additional services were not specified in the Deed of Covenant but are, the Committee believe, a very valuable security for the residents of the. bungalows, The majority of the cost in the maintenance charge relates to provision of this service to the bene,rit of all residents at the complex as a whole and have been charged in the past on a 60/40 basis. But if in order to retain the present maintenance charge, you do not wish to continue with this service and the warden is to merely act as a facilitator for the emergency services in accordance with the strict terms of the Deed of Covenant then the KMCI-IA is willing to consider any proposals you have, If on the other hand, the residents of the bungalows would like to retain the full' services of the warden then the maintenance charge will have to be increased to cover the salaries necessary to support the warden service or other costs will have to be reduced. However, there must be unanimous agreement in all matters by the bungalow residents,

. : 1 Committee has reviewed its costs and has proposed that the repainting of the bungalows 7 —Fic every, :tIltree,.years is:perhaps not as vital as maintaining the warden service for the benefit of alt residents. However if the residents of the bungalows do not think this is,of such particular importance please let us know and the Committee will look again at further costs to he cut.

":-. l he Committee is mindful of its legal obligations under the Deed of Covenant and would hope that a meaningful dialogue can be undertaken with.bungalow. resiclents: Nyithout limiting . . . „. :..:.

: its . ,:,.2:r,:.;::5it es enere',y ti.) 'the 1.,'.:.'ti.er Of the Deed ofCLIVeriant rat.116:i-haft 1.1: soleiL:

7 The Association would like a unanimous, amicable solution to be agreed with bungalow residents based on the continuation of the full Warden service; the bungalows to be painted every 6 years instead of 3 years and an increase of the weekly charge of £3,25 with immediateeffect. If a unanimous amicable solution cannot be ica ',j*! tkaltho Association will relu6tantly, have to withdraw'all additional services and adhere to its obligations under the Deed of Covenant.

We look forward to your comments on the above proposals as soon as possible.

Yours faithfully

CORLETT BOLTON. &

Cc: Mr and Mrs J M Wormald Mrs B Critchley Mr and Mrs Cook Mrs M .MacMullen Mrs M Cubbon Mr and Mrs C. White Mr and Mrs C Renshaw Mrs. Y Williams Mrs J Young Mrs T Hind Mr Emd Mrs R Parkinson Mrs J Bradley

119

• 0

KIRK MICHAEL COMMUNITY HOUSING ASSOCIATION _Tele hone/Fax: (01624) 878193

Regisiered Office:



IM6 1 FA

Mr. C. Renshaw,

21 Carman Court,

KIRK MICHAEL,

Isle of Man.

Dear Mr, Renshaw,

re: MAINTENANCE CHARGES FOR BUNGALOW OWNERS

The Management Committee have given careful consideration to your letter dated 1st

October, 2009 and respond as follows.

All Bungalow Owners have received a copy of the Maintenance Account for the financial

year ended 31st December, 2008, For ease of reference a further copy is enclosed.

At the meeting with the Bungalow Owners on Wednesday 27th May, 2009 the Management

Committee agreed to set aside the accumulated deficit of £13,999.

From the accounts you will see the following:

Income: £20,135

ExpenditurQ: Grass cutting

2,389

Care telephone etc. 1,020

3,409

To be set aside for tri•annual

external painting

Salaries and upkeep of public

rooms

32M

6,617

.17A62, £24,079

An annual deficit of -(f 3,944)

The cost of salaries (to provide an equality or service) and the up keep of the public rooms is

£ 17,462 a deficit of £3,944.

120

- 2 -

The Charity (the Apartment Block) cannot by law use its money to fund the deficit of a goodwill service provided to private owners of bungalows.

The Management Committee are left with no alternative to withdraw the fUll warden service previously provided by goodwill or make a minimum supplementary charge of £3.50 per week for the restoration of the service.

The following information may give an insight into the problem.

Maintenance charge 1998 - £25 per week National inflation 1998 - 2008 National wage inflation 1998 - 2008

Pension increases 1998 - 2009

Basic retirement pension Basic retirement pension

plus pension supplement

The documentation is attached.

2009 - £34.22 per week

increase 37% increase 40% increase 55%

£64.70 to £95.25 increase 48%

£78.60 to £142.88 increase 80%

You will notice that the salary bill has increased by 55% whereas the maintenance charge has increased by 37%.

it was our desire when establishing the complex that there would he equality of service betweentheapartment residents and the bungalow residents. UnfortunateVeeonomic reality • his taken over. To restore the full warden service requires a £3,50 per week supplement.

s--Th-(.',; Management Committee emphasise there is no requirement in the Deed of Covenant to provide a full warden service. You may wish to take legal advice in this matter.

The offer of participation in an Advisory Committee is withdrawn as there is no requirement for such a committee in the Deed of Covenant.

Please be advised that the Guest Suite in the Apartment Block is specific to the Apartment Block and not part of the communal facilities.

Yours sincerely,

Dictated by the Management Committee and signed by Mrs. Josic Stewart on their behalf

cc: The bungalow residents


Chairman: David Cannan, Company Limited by Guarantee




121

Kirk Michael Community Housing Association

Maintenance Account For the financial year ended 31 December 2008

1

1.1.) Income Service charges

1.1.2 Evendliure

Note 2008

£ £

20,135

2007 £ £

19448

2006 £ £

18,906

Salaries 2 16,713 15,629 15,722 Grass cutting 2 2,389 2,636 1,707 Care telephone and office supplies 2 1,020 1,033 827 Use of public rooms .3 749 749 686

(20,871) (20,047) (18,942)

Surplus for the year (736) (599) 24 Transfer from/(1o) Maintenance Reserve 736 599 (24)

Balance carried forward

Maintenance Reserve

2008 £

2007 X,

2006

Balance brought forward (3,640) (3,040 (3,065)

Transfer from Revenue Account in respect of 2008 redecoration

(3,640) (3,041) (3.065)

Expenditure on 2008 external redecoration (9,623)

(13,263) (3.041) (3,065)

,-,ccount in Transfer (1o)/11'orn Revenue A respect of 2008 redecoration (736) (599) 24

Balance carried forward in respect oC 2009 (13,999) (3,640) (3,041)

122

Assumptions

1 Service charges for 12 bungalows per audited financial statements as at 31 December 2008.

2 The bungalows represent 40% (12 out of 30) of the total number of units (18 apartments plus 12 bungalows) within the complex. This percentage has therefore been applied to the following items of expenditure per the audited financial statements:

salaries of the warden, secretary.,._andsier care telephone and office supplies grass cutting

3 A nominal charge of £1.20 per week per bungalow has been made to cover the use of the public rooms by the bungalow residents.

4 During the yew. ended 31 December 2008, the exterior of the bungalows was painted. As the intention is to paint the exteriors every three years, for the purposes of the maintenance account, the cost is spread over the previous three years. Unfortunately, the bungalow maintenance account is now in deficit.

123


Begistered Office:



IM6 1 FA

Mrs. :M. McMullen, 28 Cannan Court, KIRK MICHAEL, Isle or Man.

Dear Mrs. McMullen,

In accordance with the Maintenance Agreement a copy or the annual account for the period 1st January, 2009 to 31st December, 2009 is enclosed.

Yours sincerely,

DAVID CANNAN


Chairman: David Cannan, M.H.K. Company Limited by Guarantee

Warden: Mrs. J, Woods



124

Barregarrow House Barregarro w Crossroaels

Kirk Michael Isle of Man

1M6 MX

7e1 orfnv. 44 1624 878389 E-mail: mikegarchicri.Ualic 2I. com

24 April 2010

The Directors and Committee Members Kirk Michael Community Housing Association Cannan Court Main Road Kirk Michael isle of Man 1M6

.1 FA

Dear Sirs

Bungalow maintenance account

At your request, f have reviewed the attached bungalow maintenance account, which has been prepared on the basis of the assumptions set out therein, for the year ended 31 December 2009, a copy of which is attached and initialled by me for identification purposes only. The account has been prepared by and is the sole responsibility of the Directors and Committee Members.

In my opinion, the attached bungalow maintenance account for the year ended 3l December 2009 has been properly prepared on the basis of the assumptions made.

Yours.,f4ithfully

III Gardner BA FC A

125


Maintenance Account the financial year ended 3. 1 December 2009

1.1.1 Income Note

2009 2008 21)07 £

Service charges 21,271 20,135 19,448

1.1.2 Expenditure Salaries 2 16.509 16,713 15,629 Grass cutting 2 2,256 2,389 2,636 Care telephone and office supplies 2 914 1,020 1,033

Use of public rooms 3 749 749 749

(20,428) (20,871) (20,047)

Surplus for the year 843 (736) (599) Transfer from/(to) Maintenance Reserve (843) 736 599


.•'

Maintenance Reserve

Balance brought forward

Balance brought forward written Off

2009 £

(13,999)

13,999

2008 £

(3,640)

2007 £

(3,041)

(3,640) (3,041)

Provision for 2011 external redecoration (3,333)

(3,333) (3,640) (3,041)

Expenditure on 2008 external redecoration (9,623)

(3,333) (13,263) (3,041)

Transfer (to)/from Revenue Account in respect of current year 843 (736) (599)

Balance carried forward (2,490) (3,640)

126

Assumptions

Service charges for 12, bungalows per audited financial statements as at 31 December 2009,

2 The bungalows represent 40% (12 out or 30) of the total number of units (I 8 apartments plus 12 bungalows) within the complex. This percentage has therefore been applied to the following items of expenditure per the audited financial statements:

salaries of the warden, secretary and cleaner-care telephone and office supplies grass cutting

nominal charge or £1.20 per week per bungalow has been made to cover the use of the public rooms by the bungalow residents.

4 During the year ended 3.1 December 2008, the exteriors of the bungalows were painted. With effect from the, year ended 31 December 2009, the intention is to provide for the cost of external redecoration equally over the three years immediately prior to the year of redecoration. The estimated cost of the external redecoration of the bungalows in the year ended 31 December 2011 iti •£10,000; consequently, £3,333 is being provided in each of the three financial years, 2009, 2010 and 201 l .

127

Appendix 8

The Deputy Clerk of Tynwald Legislative Bindings,

Douglas,

21, Carman Court, Kirk Michael.

1M6 IFA.

31st October, 2010.

Dear Sir,

The Bungalow Owners at the Sheltered Housing Complex are in dispute with the Kirk Michael Community Housing Association over the weekly Maintenance Charge that we pay under the terms of our Maintenance Agreement. Under that agreement, set up in 1999, the initial payment was £25 a week per bungalow subject to an annual increase commensurate with the rate of inflation. The current weekly payment stands at £3442.

Very briefly the dispute stems from the following. We received a letter from the KM:CHA , dated 7th May 2009, stating that the Bungalow Owners owed the Association £13999-00., and that if it were not paid by an immediate increase in the Maintenance Charge of £8 per week then our bungalows would not he repainted in 2011.

Over the last decade the Bungalow Owners have paid approximately £150,000 into the funds of the Association. Of this about £50,000 has been spent by the Association on the maintenance of gardens, emergency telephone and the redecoration of the bungalows. This leaves a balance of £100,000 to be spent as the Association pleases in support of the sheltered housing complex. A sum more than enough to pay for any expense that the Bungalow Owners cause the Association. How therefore can we owe £13,999.00 to the Association ?

From the time that we challenged the Association's demand the Association has refused to negotiate, although it has varied the amount of increase that it wishes to extort, and has withdrawn the services of the warden. The Chairman has gone as far as to say that the bungalows are no longer Sheltered Housing.

This prevarication has continued to the moment when Brenda Cannel! MIK., speaking on behalf of David Carman MHK, misled Tynwald on two issues,

129

Firstly, she said that the meeting called by the Association on May 27th 2009, in the presence of their advocate and accountant, was to discuss the payment of the warden, and thUt the services of the warden had been offered for the extra payment of a mere 50p a day. An offer that had been refused.

This is not so. The meeting on the 27th May was to discuss our settlement of the so called debt of ,E13999-00.

Secondly Mrs Cannell MHK said in effect'.that the bungalows had not been sold as "sheltered housing" and therefore could not have been bought as "sheltered housing".

This is preposterous. At every stage of platining, construction advertising and marketing the documents for these bungalows were clearly described as sheltered housing. On the 8th day of November 2002 Mrs Clare Faulds, Advocate to the KMCHA, executed a caveat to their Deed of Conveyance dated 17th February 1998 to reinforce the restriction on the proposed twelve bungalows now erected on the Canaan Court Property to sheltered housing , and lodged it in the Deeds Registry.

The documents enclosed with this letter will bear this out. I leave the Committee to draw its own conclusions.

Yours sincerely,

C. Renshaw.

Enclosed are, 1. A list decribing numbered documents 1 - 30 2. Documents numbered 1 - 30.

130

List of documents attached to the letter to the Tynwald Select Committee dated 29th October 2009.

1. Notice of planning decisions for 18 flats and 12 semi--detached dwellings for sheltered housing at various dates from 6/1/94 -- 15/3/ 95.

2. Letter from the KMCHA to the residents of. Kirk Michael dated 18/11/97 inviting people who require sheltered accommodation to apply to Parkinson Ltd for darails of purchase.

3. A site plan of the proposed sheltered housing complex produced by Parkinson Ltd. dated 12/2/1998 and clearly titled Proposed Sheltered Housing Convex, Michael.

4 &5. Plan and elevations of pair of semi-detached bungalows for Proposed Sheltered Housing Complex, Michael, Parkinson Ltd.

6. Invitation to the laying of the foundation stone of the Sheltered Housing Convex. 10/08,

7. Page 5 of a Deed of Conveyance between KMCHA and Parkinson Ltd. dated 17/2/98 imposing the condition that buildings erected are private dwellings as Sheltered Housing. Signed by Sally Bolton (Advocat ?) David Carman for KMCHA and Malcolm Blackburn for Parkinson.

This shows that Brenda Cannel was mistaken in saying that no legal documents carried the words "sheltered housing."

131

8. Parkinson's advert poster for the sale of 12 Sheltered Bungalows at Carman Court.

9. Letter dated 24/11/98 from Corlett. Bolton 8 Co. Advocates for the KMCUA defining the quality of the warden's service that a purchaser of a sheltered bungalow could expect.

10. Letter from the Chairman of the KIVICHA dated 14/11/02 to notify us that a caveat had been issued in order to preserve the integrity of Carman Court as a sheltered housing complex. The letter states specifically that, " the use of your house is restricted to a private dwelling as sheltered housing ".

The letter continues, The Association remains determined that Carman Court is to be used only as sheltered accommodation for elderly and handicapped persons as was the original intention when the development was first designed",.

continued on next sheet

132

11. This is a CAVEAT to reinforce the Deed of Conveyance dated 17/2/98 when land was conveyed by the KMCHA to Parkinson Ltd, for the contraction of semi-detached dwellings as Sheltered Accommodation, The caveat outlines the history of the planning approvals from 1994 onwards, with conditions restricting the development to one for sheltered housing.

Para 6. of this caveat reads, " Kirk Michael Community Housing Association gave its

consent for the erection on the Carman court Property of 12 semi-detached dwellings for use as sheltered accommodation."

Para. 7. reads Kirk Michael Community Housing Association further claims that the ordinary and natural meaning and sense of the term "sheltered housing" is residential accommodation for elderly and handicapped persons consisting of private independent units with some shared facilities and a warden."

The caveat carries this declaration, " f . aare Faulds Isle of Man Advocate for Kirk Michael

Community Housing Association have executed this Caveat this 8th day of November 2002.

12. Publicity notice issued by David Carman Chairman of the KIVICIA in which he defines the Sheltered Housing Complex as 18 apartments and 12 semi-detached bungalows;

continued on next sheet

133

13. Letter dated 7th May 2009 from the KMCHA to the individual bungalow owners stating that the Maintenance Account has a shortfall of £13999-00 . therefore it is necessary to increase the basic rate of the maintenance agreement charge. The letter goes on to say, " In summary the income meets the day to day services,

but is insufficient now to provide for the three yearly external decoration costs - — - "

The letter proposes an increase of £8 per week per bungalow commencing on 1st July 2009. The bungalow owners were invited to a meeting to discuss the matter to be held ona. Wednesday 27th May.

14. Letter from C.Rensb.aw to Chairman 14:1\4CHA dated 8/5/09 suggesting that it would be acceptable to decorate every fourth year. Apology for not being able to attend the meeting on the 27th May.

15. Letter from KIVICHA dated 1q/5/09 acknowledging my letter of the 8th and enclosing a. sheet making a comparison of charges at establishments similar to Carman Court.

continued on next sheet.

134

16. Letter from the Chairman of the KMCHA offering the bungalow owners a seat on a newly devised "General Advisory Committee"

(While the existing management committee retain their control orthe Maintenance Agreement.) dated 2/6/09.

17. Letter to Chairman of the KMCHA from all bungalow datedli16/09. This letter makes the point that the annual cost to the Association of a bungalow, required by the terms of the Maintenance Agreement, is only £600 whereas each owner pays £1800 annually to the KMCHA.

18. Letter dated 5/8/2009 from Corlett Bolton on behalf of their client the KMCHA suggesting that the bungalow owners agree to have their bungalows painted once in six years AND pay an additional £3-25 per week,

19. Letter to Corlett Bolton&Co dated 10/8/09 from bungalow owners refusing to pay any increase in the maintenance charge.

20, Letter from Corlett Bolton & Co. dated 16/9/2009. to say that the KMCHA have instructed that all services, previously provided by goodwill, will no longer be available

(No mention of the £1200 per bungalow that paid for that "good will." Attached to the letter is a form of application for the services of the warden at a charge of &3.50 per week.

The letter also instructed that all future correspondence be directed to The Administrator of The KMCHA. and not to Corlett Bolton & Co.

135

21, Letter dated 1/10/09' addressed to the Administrator, Carman Court, This letter asked each and every Member of the Committee for their opinion of the dispute with the Bungalow Owners and urged them to present their figures -as a, basis for an agreement.

NOT A SINGLE MEMBER REPLIED TO OUR LETTER,

22. Letter from the Administrator KMCHA dated 13/10/09, (Dictated by the Management Committee and signed by Mrs Josie Stewart on their behalf.) This letter stated that the cost of salaries (to provide an equality of service) and the upkeck of public rooms was determined to be £17462-00 and therefore the Maintenance Account was in deficit on the year by £3944.

The letter continued by saying that the offer to establish an Advisoiy Committee was withdrawn because,

"there is no requirement for such a committee in the Deed of Covenant."

The letter also said "The Charity,(the Apartment Block) cannot by law use its money to fund the deficit of a good will service provided to private owners of bungalows."

How can an APARTMENT BLOCK be a charity ?

23. Letter from Mr Peter Hayes, Member of the Committee of the KMCHA and newly elected Commissioner for Michael dated 23/11/09. a reply to my invitation for him , as a Village Commissioner, to use his influence to help settle this dispute.

HE MADE NO FURTHER CONTACT.

136

24. Mr Hayes' election manifesto with mention of Cannan Court.

25. Personal letter to Daild Carman dated 1/12109 asking him to restore the warden service.

26. Letter from Chairman of KMCHA dated 8/12/09 in reply to my letter. He states, "The Management cannot allow charitable funds to provide a service for which there is no legal requirement

27 Letter to David Carman dated 8/12/09 asking him to clarify his position and come to terms., and to confirm that the bungalows were indeed sheltered housing.

28. Letter from Chairman of KMCHA dated 17/2/09 saying that a reply to my letter of the 10/12/09 would be sent during the next two weeks.

29 Letter from Chairman of KMCHA dated 14/1/10 to say that the Management Committee remind me of their decision to adhere strictly to the terms and conditions of the TYlaintenance Agreement. The letter Cldses with„ " THE MANAGEMENT COMMITTEE NOW

CONSIDER THIS MATTER TO BE CLOSED"

continued on next sheet.

137

30. Letter dated 27/5/10 from KMCIIA enclosing copy of the annual Bungalow Maintenance Account for 2009.

The letter says they are, " in accordance with the Maintenance Agreement".

but there is no requirement in the agreement for such accounts.

Note that the auditor on page 1 of the account says that it has been prepared by and is the sole responsibility of the Directors and Committee. He says it has been prepared on the basis of the assumptions set out on page 3

The assumption is that, the bungalows represent 40% of the total number of units within the complex. This percentage therefore has been applied to the following items of expenditure".

NO SUCH ASSUMPTION IS AUTHORISED BY THE MAINTENANCE AGREEMENT.

I WOULD NEVER HAVE SIGNED ANY SUCH AGREEMENT.

138

• • .

FiEOGIVED Frier" iNcordiE CODE REC,E1VEG

Isle of Man Government Receipt Fola,ue Rei/Cys Ellan Vannin

378579

RECEIVV0 BY

VAT REGISTRATION NO. 000 11.53 67

N.B. In the event of any isregulat conditions tieing attacnco to citr.:;;E: c ucxacLJi Z u Liivy U A Li

approved notice is forwarded herewith.

Nun-0)er

(•-• '.%;..)

I)escription

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.

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....

. 1 ' ,.: .... ./ 6 / /...;,.(..&.

iY

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Refufied Date

, ,'/

g_ ,..,...r.

Approved Length

Date validity

(in years) of approval

of Conditions attached

7-1

139

KIRK MICHAEL COMMUNITY HOUSING ASSOCIATION

Hon, Secretary Chairman Mrs A Barron. David Cannan MEW Cair Vie White Gables 1 Kerrocruin Curragh Road Kirk Michael Ballaugh Isle of Man Isle of Man

IM7 5BG 1.8th November 1997

To the residents of Kirk Michael

Kirk Michael Community Housing Association are pleased to announce that the construction of the sheltered housing complex has commenced,

The apartment block will contain 10 two bedroom flats and 8 one bedroom fiats together with wardens flat, community lounges, laundry room etc.

The apartment block is expected to be ready for occupation in November 1998,

The total cost of the project is £1,532,000.

Government is providing £681,000 which equates to the cost of 8 apartments and these apartments will be for persons nominated by the Department of Local Government and who are eligible for public sector sheltered housing.

Public subscription - is providing £851,000 which equates to the cost of 10 apartments and these apartments will be for persons nominated by Kirk Michael Community Housing Association.

To date public subscription has raised £600,000 and our Bankers have provided an overdraft facility of £250,000 which needs to be repaid as quickly as possible. The Association is making a determined effort to raise the necessary funds. Donations, no matter how small, will be gratefully received and should be sent to David Cannan, White Gables, Curragh Road, Ballaugh.

Persons who are interested in having sheltered accommodation and are over the age of 60 years and are either resident in Kirk Michael or have family connections with Kirk Michael, should ask for an application form from any of the following persons - Mrs Marilyn Connell, Mrs Ann Barron, Mr Tom Dolby, Mr Brian Heywood, Mrs Phyllis Cashin and David Carman

Company Limited by Guarantee. Registration No: 060705 C

Isle of Man Charity Registration No: 670 Registered Office: White Gables, Curragh Road,

Ballaugh 1M7 513G Tel: (01624) 897926 Fax; (01624) 897926

140

Persons who have previously submitted an application are asked to re-apply.

The whole complex will be managed by Kirk Michael Community Housing Association.

There will be constructed, adjacent to the sheltered housing apartment block, semi-detached two bedroom bungalows for freehold salg, to persons who require sheltered accommodation. The bungalows will have an alarm system wired to the wardens flat and the owners will have the use of the community facilities in the apartment block.

The bungalows will be constructed by Parkinson Limited and persons wishing to purchase a bungalow should contact Parkinson Limited, Parkinson House, Peel Road, Bradd.an (tel; 674331) or Mr Malcolm Blackburn, Bold Venture, Christian Avenue, Kirk Michael (tel 878638) for further details.

Arrangements are being made for Mr William Scholl, on behalf of the Dr Scholl Foundation of America, to formally lay the Foundation Stone on Saturday 10th January 1998.

The provision of sheltered housing will be of lasting benefit to the community of Kirk Michael.

Yours sincerely

;IC

David Carman

141

...

143

KIRK MICHAEL COMMUNITY HOUSING ASSOCIATION

Hon. Secretary Chairman Mrs A Barron David Cannan MHK Cair Vie White Gables I Kerrocruin Curragh Road Kirk Michael Ballaugh Isle of Man Isle of Man

IM7 5I3G


request the pleasure of the company of

40 10 96 40.0.41.9110 OOOO ** ** e ■■•99416 **** .1; ****** 19119)1.11•9•••Ir.• ***** 310 **** 4999 .....

at the laying of the Foundation Stone

of the sheltered housing complex

(rear of the Doctor's surgery)

bY

William H Scholl Esquire

on

Saturday 10th January 1998 at itOOam

And afterwards to a Reception and

Presentation in St Michael's Hall

RSVP: Mrs Ann Barron Cair Vie Kerrocruin Kirk Michael (by 21.st December)

Company Limited by Guarantee. Registration No: 060705 C

Suitable footwear is strongly recommended

Isle of Man Charity Registration No: 670 Registered Office: White Cables, Curragh Road,

Ballaugh 1M7 5BG Tel: (01624) 897926 Fax: (01624) 897926

145

,0

ia(f.. or(' clAreA 1J A <,:,,o6c± .7 Corn bItc.1,“ off roc('-w16 -=` e''1:="1\ -

3. A right of way ;for all purposes for the Vendor and its successors in

tide to the whole or any part of the KIVICHA Estate or the

neighbouring lands and all oiler persons having a like right to pass and

ranass with or without vehicles over the said road...

4. The„ right of support necessary for the proper enjoyment of the

adjoining lands and all other buildings and boundary structures erected

thereon and the right of entry to the extent necessary for the purpose of

maintaining repairing and replacing any such buildings or boundary

structures by making good any damage clone in the exercise of such

right or entry._

FOURTH SCHEDULE WITHIN REFERRED TO

1. No building or structure shall be erected placed or permitted to stand

on the Scheduled Property other than a paximun,...offburteen (14)

semi-detached dwellings being private dwellings with or without ........ private garages and/or greenhouses conducive to the development of

the Scheduled Property as Sheltered Accommodation and as shall be

required and/or approved by the appropriate Planning and Bye-Law

Authorities without the consent in writing of the Vendor first had and

obtained...

2. Not to erect any further building,s temporary or otherwise upon the

Scheduled Property or make any alterations to the external appearance

of the dwelling house and garage erected on the Scheduled Property

without the prior written consent of the Vendor and not to alter the

colour scheme of the exterior of the building on the Scheduled

Property without the prior written consent of the Vendor...

3. No signboard hoarding plaque or other advertisement (other than a

board of a reasonable size announcing that the property is to be let or

sold) shall be placed upon the Scheduled Property...

4. Any dwelling house or premises erected on the Scheduled Property ...... •

shall be used as a private dwelling house only as Sheltered , .. .

Accommodation and no trade or business of any kind shall at any time

be carried on upon the Scheduled Property or any part thereof or in or

upon any building or other erection erected thereon...

146

EXECUTED by the Purchaser in the presence oE-

x. A

Retail-Ie.(' Land as may be required by and to the satisfac6oa of So

apprQpiial) Statutory Au t1 of ties ...

E.-k.:ECUTED by the VC14601'

!I 3:(1:: piCSCIIC;C: .0f7:

,

1,),2 Cc."Tcq_.

,-- .-.1 -,/:'iti-,\) %.,;\,',A H-15,‘-tik-t.0

1,107,u.,,,a,-.; 17...:i #G

ON nicoodiAN '4 ls 1:-."--: ---- iviA,Q.

Vckalcolt

147

'EE .,:01624 674'331

E71:19:000

A DINEIDPMEili OF 12 QUALITY NED BON GALows

I N Ail E.XCI PT I ()NAL LOCATION

BY

148

C: 1.;

Fi

A PA INI4'1

)etails

oor ;15;j1oh.lv,.

0116iInvii h.B.

Property

allractrve (.4. Kirk Michael is situated on the tnagni ficent West co;tist of the Island and

]I..-= Faro' charm %%Ili'sl fall range of firM class Medi ties -rhe Centre of lhe east.- ...walk;ny, dinance niCanlirin. Other main ctentres areconveniently accessible lc+ cat or bu:;.

I .r.l. a:.iot-tt„ the, ftolicy of c.orninttrat iritt)r(..)verrtetit ttnd iheic may F•t.;

Thaftyc :A. to detailed above.

149

4,1

24-11•1598 U.; 44 • ,—

CCRLETT Ba.-roN g er324 676966 P.Q11

0624 676966

Ipollton & Co. ADVOCATES

l'OTARJES PUBLIC COMNIISSlONERS FOR OATHS

Your Ref: MC-Mc/1711

Our Reif: NIRC/II.,013306K

2.4:1' November [998,

Messrs. Morris .Maddrell, Advocates, 37 Parliament Street: RAM3f..:Y, isle of Man. (M8 1 AO. 13y FACSIMILE & POST: 817327

Dear Sirs,

RE: -KIRK MICHAEk., HOUSING ASSOCIATION and PARK3NSON L 'AMITE D

We thank you for your facsimile letter of the 7°' 'November last.

We. now have instructions from our Client .Association.

Our Client Association has confirmed that the communal facilities are provided save that communal are provided by the Housing Association for the benefit of the owners of the serni-detaehed bungalows. Regarding the washing machine facilities., our Client Association lies reminded us that the Purchasers, or prospective Purchasers Mr and Mrs. R,enshaw were shown around the apartment block and communal lhcilities 01) Monday le November. The laundry room is a communal .facility and. the us&',. of the washing machines is by using a token purchased from the wardeniotTice at the cost of .1;1.20. This facility is open to ail residents at Cannon Court and we understand a similar arrangemerrt applies to all sheltered accommodation throughout the Island.

With regard to the television licence fee, our Client Association understands the concessionary TV lic,ence fee is for the residents of the apartment block and granted by the Isle of Man Post Office in respect of elderly persons accommodation registered with the Department of Health and Social Security. Our Client Association is making further enquiries in this regard and will revert to you.

With. re!.zard to window cleaning, our Client Association has confirmed this is the responsibility of the owners of the bungalows.

30 Athol Strc.t, Douglas. b,:k: geMon, IML 1i Toephunc: (01624) 676865 Facsimik: (01624) 676%6 0..lt 1341112

R,:gimeatioo No. 00) 0496 35

Elokon, B.A. C. Paulds 1. •Karran. M.B.A. Verardi, rhi3 Firm iti mahorised ty dm Mai taw Socicty the conduct of inveyttirew. Busincs5

150

x1.;45

CORLETT 3OLTON g CO 0624 676966 P.02

0624 676966

With regard to the. installation to the telephone and intercom system, we understand the cost or this is ineluded in the cost of the bungalow as confirmed by your Client Company. The rental and cost of the telephone calls is the responsibility of the householder. Any accidental damage or serving of the telephone/intercom system is at the householder's promises will be the responsibility of the kiouseholder,

The duties of the resident's warden include being "a good neighbour" in ensuring the . enteral well being of the residents in the buncalow, there will beasesident's warden . 365 days aiear 24 hours a day,, there is also a telephone/intercom system to contact . . the warden at all times.

We trust this information is helpful to you.

Yours faithfully

ittAtt-410.1)(*e-4-'0

CORI.,ETT BOLTON ez. CO.

152

RK MICHAEL COMMUNITY HOUSING ASSOCIATION Telephone/Fax: (01624) 878193

Registered Office:

Canaan Court, Main Road,

KIRK MICHAEL, isle of Man.

1M6 WA

14th November, 2002

Mr, and Mrs. C. Renshaw, 21 Cannan Court, KIRK. MICHAEL, Isle of Man.

- I, Dear r , 0/1-.A. / ,4••y-f .•

It has been necessary to take legal advice regarding the sale of the bungalows so as to preserve _„. the integrity of Carman Court as a sheltered housing complex.

Accordingly I write to advise you as follows:-

I am concerned that there may be some misconception as to the effect of the restrictive covenants which affect your property.

Enclosed is as copy of a caveat which has been filed in the Deeds Registry which explains the history and position of the planning conditions and the restrictive covenants, You will sec that the use of your house is restricted to a private dwelling house as sheltered accommodation and that there was a requirement that the development at Ciuman Court should be conducive to the development of the estate aS: iheltered accommodation,

Kirk Michael Community Housing Association has confirmed the position with the Planning Office at the Department of Local Government and the Environment and with its legal

ne Association remains determined that Carman Court is to be used only as sheltered accommodation for elderly and handicapped persons as was the original interrtiOn when the development was first designed, ......

If you have any queries please do not hesitate to contact me.

Yours sincefely,

DAVID CANNAN Chairman


154

IN THE MATTER. of e Deed of Conveyance dated 11th FeLnuary 1998 fnom IURK MKtHAEL COMMUNITY HOUSING ASSOCIATION to P.ARKINSON LIMITED of ALL AND SINGULAR =min haCCIIMICEM (herein called the Carman Court Property') part of the Whitehouse Estate in the Vilinge District and Parish of .11ilitthael repreted for dui. impose of identii&ation and net of tiraitation can the plan thereto annexed by the portions delineated awl edged red and hatched pink

and

IN TI-I . MATTEa of re.:Arielive COVCAIMS affecting the title cc 12 mni-datached dwellings built thereon and itaw known as Comm Court

TAKE NOTICE:

i. KIM MICHAEL COMMUNITY HOUSING ASSOCIATION by application number 941119;3 dated 22" Mov4.1teher 1994 applied to the Planning Committee of the Depaunatac of Local CiOVCITInerIt and the Environment .for Planning Approval for a sheltered housing development V)/ApicisWg a two .steray apartment Meek consisting of 11) two bedroom flats and C one bedroom flats with wardens flat and 12 two bedroom semi-dew:Uri bungalows. in planning application number .9411193 the site fri be developed was demi-Rif...A as 'Site as Baltic Road Kith Michael" and the plan of the site included the Cattnan Court Property.

Planning any iication rattab,tr 94/1193 was approved at a meeting of the Planning Contraitti„ta .hold on le' December 1994 aubjcet totompliance with the conditions or utodirmith)os specified in the schedule attached to the notice of approval issued an 10° January 1995,

Condition i of the schedule to die approval' notice issued on 10th January 1995 iaa respect of planning application masher 94/1191 sultes

"The Buildings) shall not be used for any otlust purpose than that indicated on the plait or in the application without the consent of the Comntineo."

By Deed of Conveyance dated 17'4 February 19911 Kirk KAMA C.onnounity Housing Association sold du Canaan Cann Property to Parkinson Limited subject to restrictive covenants that (inter alia):

"No building or structure shall be erected placed or permitted to stand On the Scheduled Prop mw ether dm a maxituran of fourteen (l4) setni-derached dwellings being private dwellings with or without private garages andior greenhottses conducive to the developtnent of the Seheduled Properly as Sheltered Accommodation and as shall be requited and/or approved by the appmpriate Planning and Bye-Law Authorities without the consent in writing of the Vender that had and obtained"

urrd

155

'Any tiweil lug house or premises erected an the Solieduled Property shah anus co as a piiiiate, dwelling house only as Sheltered ACcorialuGdetion and no trade or business of any kind shall at any titan be carried on upon lho Scheduled Property or any part thereat' or in or upon any building or other ineotion thereon"

Parkinson Lirhilteci developed the CartMM Coact Property with the concern of Kirk Michatt Community Housing Association mid subsequently sold the c' _moan Court Proper y as t2 plots each with a semi--detached dwelling and each subject to restrictive covenants that Outer alto):

"No building or structure shall be erected placed or permitted to stand on the Scheduled Property other than one dwelling with at- without private garage andia• greenhouse conducive to tho development of the Parkinson listate as Sheltered Accommodation and as shall be required and/or approved by:the appropriate Planning nod Bye--Law Authorities without the consent in writing of the Vendor first had and obtained"

'Any dwelling house prernisw erected on the Scheduled Property shall be used as a private dwelling house only as Sheltered Accommodation and no trade or business of any kind shall at any time be eartiodort upon the Scheduled Property or any part thereof or in or upon any building or over erection theme

ES, Kirk Michael Community Plowing Association gave its consent for the erection on the Carman Court Property of 12 Uttli-detached dwellings for use as sheltered aecornutodation•

7. Kirk Michael Corium-ray Housing Association claims that the elf4tri ec the mstrimi"

covenants in the Deed of Conveyanee dated 170 February 1998 from Kirk Michael Community Rousing Association to Parkinson is to restrict the UN of any of the 12 stag-detached dwellings ROW erected on the Catinan Court Properly to sheltered housing or actiotrattadation, c.;fpi1:t111n4.y.,,Plo using As ace faqherplpintsthatfits rd3rrtary az al nat.:1iT t iTtei1-1R.OnKisenv

far eiderly.„..W_IiartriicapPa:Persons consisting ofiNivate units With some sitaied fa. aides anda 5aiarclert.

.„.

IN WITNESS E CLAT.U.:, FAULDS of 4 Finch Rood Douglas Isle of 'Man Advocate for Kirk Michael Corrireimity Housing Association have ettecuted this Caveat this 8° day of November 20(/2.

and

Witnessed by:

Lrme. C Maiany 4 Findt Road Douglas Isle of Man D41 2F1' Legal Secretary

156


RegistergAQifice:



IM6 1 FA

On the 12th December, 1998 the sheltered housing complex was Opened by William and Susan Scholl.

There are 18 apartments ((0 double and 8 single) plus warden's apartment in the main block, together with 12 semi detached bungalows in the complex.

The total cost of the complex, excluding the bungalows, was E I ,600,000. At the time of the Opening £700,000 had been provided as a Go-vertu:tient grant, £600,000 from public subscription and a bank mortgage of £300,000.

On 30th September, 2008 the bank mortgage was repaid from money donated and fund rinsing activities during the past 10 years.

The complex is owned by the Kirk Michael Community Housint, Association on behalf of the residents of Kirk Michael and is now free of all debt.

Since the Opening in December 1.993 the complex has at all times been full to capacity and there is a substantial waiting list.

However, fund raising wilt continue to establish a reserve fund for the refurbishment and renewal, during the coming years,

The Chairman and Members hope you will be able to join us for this memorable occasion.


157


BegkitegtiCASR:



IM8 1FA

7th May, 2009

Mr. and Mrs. C. Renshaw, 21 Carman Court, KIRK MICHAEL, Isle of Mara.

Dear P/k 44-4, ,1;?

re: BUNGALOW MAINTENANCE ACCOUNT

Enclosed is the Bungalow Maintenance Account for the year 2008 and you will recall that your bungalow had external decoration during the year.

You will notice on the accounts that the income from the present maintenance agreement is £20,135pa and expenditure on the day-to-day services (excluding the charge for the use of public rooms) is £20,121

In summary the income meets the day-to•day services but Is insufficient now to provide for the three year=ly external decoration costs which have been in the past paid out of contingencies. However, the cost of the external decoration can no longer be funded from this source.

Since 1998 when the maintenance charge under the Agreement was established, the inflationary costs have btzn greater than the annual increases in the maintenance charge. The cost of external decoration in 2002 was within the maintenance budget, In 2005 there was a shortthil of £3,065 and in 200.8 the shortfall was £9,623 making a total shortfall in the bungalow maintenance account of ;13,999,

Therefore it is necessary to increase the basic rate of the maintenance agreement charge. As the maintenance agreement is a legal document the change in the basic rate can only be achieved by the written consent of all the bungalow residents or alternatively by application to the Court.

The proposed increase is £8 per week £416 per year commencing 1st July, 2009.

The bungalows are due for repainting in 2011 and this proposed increase will provide £1,040 per bungalow (total £12,4180) to 31st December 2011. The cost of decoration in 2008 was f.9,621 or P.802, tier Iionantow Thr, nrevirkio....11 citcoritm 101 if 5110 .5 15

158

£882 per bungalow.

. - The surplus (E12,480 - £10,585 £1,895) will assist in =luting the overall deficit of

£13,999.

To discuss this matter you .sae invited to a meeting in the lounge at Cannan Court on Wednesday 27th May at 7.30pm. Present at the meeting will be the Management Committee together with Mr. Gardner 8.A., F.C,A., formerly senior partner., KPM.0 and Ms. S. Bolton, Senior Partner, Corlett Bolton. Advocates.

1 do hope you will be able to attend this meeting.

VOW'S sincerely,

tei

DAVID CANNAN

Isle of Man Charity Registration No. CVO

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KM MICHAEL, C MUM HOUSING ASSOCIATION Telephone/Fax: (01624) 878193

ITV Roaistpt9d.

Carman Cour( Main Road,

KIRK MICHAEL., Isle of Man.

IM6 1 FA

19th May, 2009

Mr. and Mrs. C. Renshaw, 21 Canaan C'out, K.IRK MICHAEL, Isle a C Man.

Dear , 63-

;7,4 Alckcl'ENANcE AccotiNT

Thant< you for your letter with COMMOMS raid suggestion in respect of the bungalow maintenance account, it is nutc.'n apprv,:iated.

Your letter has been brought to the attention or the Management Committee.

A list or comparison of charges which you m4.,,..ht rind useful is enclosed,

ant sorry you are unable to be present at the meeting and you have my best wishes for an enjoyable air•Island trip.

Kind regards.

Yours sincerely,

[..)AVID CA.NNAN

of Man Charity Registration No. 670

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KIRK MICH EL COMMUNITY H USING ASSOCI TION Telephone/Fax: (01624) 878193

RealsjgrO Office:


KIRK MICHAEL, isle of Man.

1M6 -1 FA

2nd June, 2009

Mr, and Mrs. C. Renshaw, 21 Ctuman Court, KIRK M ten A EI.„ isle of Man.

Dear. 1.() /,'A.

The trustees of the Kirk Michael Community Housing Association have reviewed the Constitution and decided to establish with effect from 1st September, 2009, a separate General Advisory Committee and a separate Executive Committee whose membership will be the existing Management Committee.

'the Executive Committee will be responsible for the day to day management of the apartment block and the terms of the Maintenance Agreement with the bungalows.

file General Advisory Committee members will be a representative from the bungalows and a representative from the apartment block together with the members of the Executive Committee and will meet from time to time to discuss matters relevant to the bungalow residents and the apartment residents.

Theretbre the trustees request that the residents of the bungalows hold a meeting amongst themselves for the following purposes.

a) To elect or appoint a ,person as their representative on the General Advisory Committee.

b) To agree a policy (options for change) for the future external decoration of the bungalows, copy enclosed.

It will be helpful if the Management Committee are informed of the outcome of the residents meeting before 15th July, 2009,

164

Again, I offer most sincere apologies for the misunderstanding or upset caused by the letter dated 7th May, 2009.

Yours sincerely, 4

DAVID CANNAN

cc: Mrs. Joan Woods


Chairman: David Cannan, iv1.1-11( Company Limited by Guarantee



Clerk/Administrator Ws. .1 Stewart

165

21 Carman Court Main Road Kirk Michael Isle of Man 1M6 IAA

ince 2009

wry uoiffymsuincE.

The Chairman and Committee Kirk Michael Community !lousing Association -Car rasara Court Main Road Kirk Michael Isle of Mao 1M6 WA.

Dear Chairman and Committee,

Further t3 your letter of 751 May 2009 and the subsequent Meeting on 27th May 2009, we -would set out our feelings on the matter as follows:

We would point out that we arc under no legal obligation to accept your proposed increase to the .Maintenance Charge, This charge js governed by Contracts between the Association and the residents.. The Ass,ociation is respowible for dischroging, its obligations under those Contracts, using whatever resources rue available to it, inchrding its considerable accumulated reserves, We note indeed that the Association has already agreed that the so-called deficit on the Maintenance Account to-date should be funded from those reserves,

The weekly Maintenance Cimi.ge is more then added,! .rate to cover the cost of items stipulated in the Maintenance Agreement The Community Housing Association is under no obligation to rebid I:aatJ.s .ti surplus to those, required to cover maintenance costs, and this surplus goes to the Association as a donation towards the costs of administering Cannon Court.

The cost of maintenance is about one third of the stun raioed by the Weekly Charge and therefore two thirds goes to the Housing Association as a donation to be used for other purposes.

The current Weekly Charge, raises approximately £1,800 a year per bungalow, and the .currr,-)ixt cost of maintenance is approximately .€600. This means that the Housing Association is receiving £1,200 this year which, we feel, is a more than generous contribution to the staffing and administration costs of the Association.

We look forward to hearing from you.

Yours faithfully.,

On Behalf of Bungalow Owners/Residents

166

C R 17, T B..7 ,t7, N

CQ

Our Ref: NK/KB/20405.001/K Direct Dial 699831 Your Ref: (Secreealy)

5th August 2009

Mr Renshaw 21 Carman Court Main Road Kirk Michael Isle of Man 1M6 IPA

Dear Sirs.,

Advaoate8 r-rotarie.13

Corruytis,..Tionk;r3 far: i'D2at8

•

aWmanr- C Bun9910Y/ try /T14'6

We act fbr Kirk Michael Community flousing Association ("KMCI-IA") and we write in response to your letter of 4tk June 2009.

Our client would like us to addre,ss the issues raised in your letter in response to the increase in the maintenance charge proposed by the Conunittee of KMCHA.

I(MCI-IA is a Company limited by guarantee and is also a registered Charity. The Company as a Charity is responsible for the upkeep and maintenance and operation of the apartment block and its various services, many of which are made available to the owners of the bungalows, including the ad.mnistration and warden services, Some of these services are additional to those basic services provided for in the Deed of Covenant the bungalow owners signed when they purchased their properties.

At present accumulated financial reserves tbr the Charity are raised by volunteers selling teas at TT week and other fund-raising eyi,,qt.s. The Chatity should not provide services outside its objects and the fonds raised have been used to rodrice the Charity's borrowings and f01 the maintenance of the apartment block, The obligations of the Charity do not extend to the private contract made between you and the KMCIIA.

We note what you understand to be the. current cost for fulfilling the obligations under the maintenance agreement however, our client would like to clarify to you how their proposed figures were reached and we would advise as -follows:-

You will see at clause 2(b) of the maintenance agreement that residents of the bungalows are permitted 'to use in the case of emergency the telephone and intercom system installed in the premises to notify the warden residing in the apartment block of such emergency". As you will he aware the residents of the bungalows currently enjoy additional warden services including a visit from the warden once a day and attendance at. the properties should anyone require the warden's assistance. The warden service is available 21 hours a day; the 3 how.

4, Finch Rot's], 1)-Fughtm, '3111e 44U.':itut, 11\4121Yr Briti5h Iska

Pactacs: SDA laTAtOri Cor.v.; Fcattall N

167

rest period is covered by a Carephone system. These additional services were not specified in the Deed of Covenant but are,-the Committee believe, a very valuable security for the residents of the bungalows. The majority of the cost in the maintenance charge relates to provision of this service to the benefit of all residents at the complex as a whole and have been charged in the past on a 60140 basis. But if, in order to retain the present maintenance charge, you do not wish to continue with this service and the warden is to merely act as a facilitator for the emergency services in accordance with the strict terms of the Deed of Covenant then the WCHA is willing to consider any proposals you have, If on the other hand, the residents of the buugalows would like to retain the full'services of the warden then the maintenance charge will have to be increased to cover the salaries necessary to support the warden service or other costs will have to be reduced. However, there must be unanimous agreement in all matters by the bungalow residents.

The Committee has reviewed its costs and has proposed that the repainting of the bungalows every three years is perhaps not as vital as maintaining the warden service for the benefit of all residents. However if the residents of the bungalows do not think this is of such particular importance please let us know and the Committee will look again at further costs to be tut.

The COMMiLtee is mindful of its legal obligations under the Deed of Covenant and would hope that a meaningful dialogue can be undertaken with bungalow residents without limiting its services merely to the letter of the Deed of Covenant rather than its spirit.

The Association would like a unanimous, amicable solution to be agreed: with bungalow residents based on the continuation of the full warden service, the bungalows to be painted every 6 years instead of 3 years and an increase of the weekly charge of £3.25 with immediate effect, if a unanimous amicable solution cannot be reached then the Association will reluctantly have to withdraw all additional services and adhere to its obligations under the Deed of Covenant.

We look forward to your comments on the above proposals aS S0011 as possible,

Yours faithfully

9,! cLi(,)-•

CORLEIT BOLTON & Co,

Ce: Mr and Mrs J. M Wonnald Mrs B Critchley Mr and Mrs Cook Mrs M MacMullen Mrs M Cubbon Mr and Mrs C. White Mr and Mrs C Renshaw Mrs. Y Mrs 3 Young Mrs T Hurd Mr and Mrs R Parkinson Mrs :1 Bradley

168

1o.(8) 09 ,

Dear Sir, In reply to your letter of August 5th.

We, the Bungalow Owners at Cannan Court were very hurt and saddened by your client's suggestion that we wanted the KMSH.A. Charitable funds to subsidise us as private 'house-holders. Nothing could be further from the truth.

iTicA.vever, before embarking on-.a. rebuttal of your client's suggestion , may we first remove two misconceptions which you .dient makes central to his case. Firstly he maintains that this is a 'small matter of the Maintenance Account being in deficit and which a tiny increase of only T.3,25 per week will put right

But this is not true. l'he Maintenance .Account is hu0,e,ly profit. Only one third of the money collected under the Maintenance Agreement is spent on maintenance. The remaining two thirds goes to the KIVISHA to spend as

it pleases., Why then dues your client insist that the Maintenance Account is in ddicit;)

is beCakISZ your client has taken it into his bead that the Warden's salary should be paid for on a MVO) ratio with the Bungalow Owners paying 40 and the K..MSIAA, paying 60 percent of the WaP6.eT.C5 salary and has been using the Maintenance Account in his calculatims.

But there is no agreement between the .,,,,MSHA and the Bungalow Owners for us to pay any fired portion of the Warden's salary, The employment of a warden or wardens, or any other staff for that matter, is entirely the concern of the KMSHA and is no concern of the Bungalow Owners, and is certainly not a matter which concerns the Mainten-ance .Agreermnt.

169

Let us now consider the situation as we see it. We are only too aware of the .KMSHA's charitable status because the Bungalow Owners are probably the Charity's largest single benefactor. in the last ten years we have pa:kL about El50„000 to the KMSHA. Of this about £50,000 has been spent on maintenance under the terms of the Maintenance Agreement leaving some £1.00,000 retained by the KNISHA as a donation to be spent as it pleases. In the next ten years, allowing a modest use in inflation, year on year, the Bungalow Owners' contribution to the KNISH.A. funds will be between 41200,000 and E300,000.

And what do we ask in return for this huge sum of Money ?

Only that the ward 'n spends a total of about 45 minutes each day going round to c.heck that the occupants of the bungalows are OK., and -that, in the very rare cases of accident and .e.rflergency the warden will use their training ',Ind experience to s Li rairiOn the necessary assistance. We require nothing more. it seems little e-noug.h to ask in retil ill for considerable donations.

We have paid on r weekly .Maintenance Charge for years, in good faith, donating a huge surplus to the MS IA,, and now we are accused of wanting the ,Charity to subsidise, us with funds mised by volunteers selling sandwiches and the ike. it would he laughable if it -weren t so sad and kiug.al.c.;-.10,1 , •

170

CORLETT B 0 LT 0 N

CQ Athroca tcS

Notaries Pub tic

Coniraissionefs for Oaths

Our Ref: SBNR/K13/20405.001/K Direct Dial 699831 Your Ref: (Secretary)

16th September 2009

'/1I C Renshaw 21 Carman Court Main 'Road Kirk. Michael Isle of Man 1M6

Dear Mr Renshaw,

e; Maintenance Char g:es fOf Bungalqw 0.1ryne3s

Your letter dated 10th August 2009 has been given careful consideration by the Management Committee of the Kirk Michael Community tiousing Association who respond as Follows:

In consequence or the sentiments expressed, with effect from Monday 28th September 2009

the N'Ianagement (..oriunittee have instructed lhe Warden and staff employed by the Kirk Miehael Community Housing Association adhere to the terms and conditions set out in the Deed of Covenant with the hunga1ow residents. This means that all services previously

provided by goodwill will be no longer available.

For those who wish to continue to receive the' full warden service an application form setting out what will be supplied is attached and topother with a copy of this letter will be sent to each bungalow resident.

All future correspondence in this matter should be addressed to: Mrs J Stewart

Administrator and Secretary Carman Court,

and marked for the attention or the Management Committer if so desired.

Yours faithfully

)

CORLETT BOLTON & Co.

1, Finch Rom!, Douglas, Isle of Man, fM1 201' British istci

Principal: SM Bolton Cons Karran Associalt: Advocate: N 'Roberts

Tdeplionc: +44 (0) 1624 676068 Facsimile: +44 (6) 1624 476966

mairlcoylettboltorbcorn Web: www.cortettbotton.cinn

Vh.T Regi8tration: 001 0496 36

171

Cc Mr and Mrs M Wormald Mrs B Critchley Mr and Mrs Cook Mrs M MaeMullen Mrs M Cubbon Mr and Mrs C While Mr and Mrs C Renshaw Mrs Y Williams Mrs J Young Mrs T Hurd Mr and Mrs R Parkinson Mrs J Bradley

172

REQUEST FOR FULL WARDEN SERVICE

Bungalow Resident:

Name(s):

Address:

LWe request that a full warden service is provided with effect from:

Date:

The cost will be £3.50 per week (50p per day) until 31st March 2010, thereafter the matter will be reviewed on an annual basis-. The payment to be added v) yew current.

-weekly/monthly maintenance charge.

Once signed up for this additional service, either party wishing to cancel the full warden service can do so giving one month's notice.

The benefit of a lull warden service will provide:

a) A daily check up visit from the Warden b) In times of illness or distress the Warden will make farther visits to ensure all is

well. c) In cases of illness other incapacity or emergency the Warden will contact

relatives if and when requested. d) Notification and inclusion in all activities organised by the Warden in the

Apartment Block e) The appropriate level of care previously provided through goodwill will be

maintained.

It will be helpful if you wish to receive the hill warden service as from Monday 280 September to return this form to Mrs Josie Stewart as soon as possible and sign below.

Signed • ................ ef.0”.7••p. ..............

173

Dear Mrs Stewart,

Re: Maintenance Charges for Bungalow Owners.

Your advocate, Collett Bolton Co., in their letter dated 16th, September, have suggested that all future correspondence on this matter should be addressed to you. in order to avoid any further misunderstanding and to define precisely what is in dispute between the Bungalow Owners and the Management Committee would you please submit these questions to the members of the 'Management Committee,

I Do the members of the Management Committee accept that there is no deficit in the so called Maintenance Account ?

i.e. Our Weekly/ monthly payments adequately meet the costs of, as the emergency telephone

b. cutting the grass c. painting the bungalows

2. Do members of the Management Committee agree that, having met the cost of the above, there is sufficient money left to pay an equitable share, say 4110, of the Wardens sahtiy ?

3. Do the members of the Management Committee agree that having met all the above expenses, telephone, grass cutting, painting and share of warden's salary, there is still some money left that can be applied to the cost of the upkeep of the communal facilities in the Apartment Block ?

174

We, the Bungalow Owners, would estimate that having paid our share of the costs outlined in paras I. and 2 there should be a sum of about £600 ( Six hundred pounds) per month that the Management Comm ittee could apply to the upkeep of the communal .facilities in the Apartment Block.

We should be pleased 1:() receive details of the Committee's figures so that we can determine exactly what is in dispute between us.

Meanwhile, since we are already paying you monies each week / month sufficient to pay our full share of the Warden's salary we can say that we are not in dispute about the Warden's services. We think therefore that it would be appropriate if you withdrew your request for an additional payment for the warden's services or any threat to discontinue the warden's daily visit. in view of this, that we already pay the Warden in full, may we have the Committee's assurance that we will hear no more about withholding the Warden's services.

Yours faithfully.

175

RegiateLed (Ake.:



1M6 1FA

KIRK MICHAEL COMMUNITY HOUSING AS Telephone/Fax: (01624) 878193

13th October, 2009

Mr. C. Renshaw, 21 Canaan Court, KIRK MICHAEL Isle of Man.

Dear Mr. Renshaw,

re: MAINTEN.ANCE CHARGES FOR BUNGALOW OWNERS

The Management Committee have given careful consideration to your letter dated 1st October, 2009 and respond as follows.

All Bungalow Owners have received a copy of the Maintenance Account for the financial year ended 31st December, 2008. For ease of reference a further copy is enclosed.

At the meeting with the Bungalow Owners on Wednesday 27th May, 2009 the Management Committee agreed to set aside the accumulated deficit of E 13,999.

From the accounts you will see the following:

incnxne: £20,135

Emenilituro: Grass cutting 2,389 Care telephone etc. 1,020

3,409 To be set aside for tii-annual

external painting 3208.

6,617 Salaries and upkeep of public

rooms. J7,462. .E2A.,' 029_

An annual deficit of -(E 3,944)

The cost of salaries (to provide an equality of service) and the up keep of the public rooms is £17,462 a deficit of.E3,944.

176

- 2 -

The Charity (the Apartment Block) cannot by law use its money to fund the deficit of a goodwill service provided to private owners of bungalows.

The Management Committee are left with no alternative to withdraw the full warden service previously provided by goodwill or make a minimum supplementary charge of 0,50 per week for the restoration of the service.

The following inforrnatibn may give an insight into the problem.

Maintenance charge 1998 £25 per week

2009 - £34.22 per week

increase 37% National inflation 1998 - 2008

increase 40%

National wage inflation 1998.. 2008

increase 55%

Pension increases 1998 - 2009

Basic retirement: pension £64.70 to £95.25 increase 48%

Basic retirement pension plus pension supplement £78.60 to £142.88 increase 80%

The documentation is attached.

You will notice that the salary bill has increased by 55% whereas the maintenance charge has increased by 37%.

It was our desire when establishing the complex that there would be equality of service between the apartment residents and the bungalow residents. Unfortunately economic reality has taken over. To restore the full warden service requires a £3.50 per week supplement.

The Management Committee emphasise there is no requirement in the Deed of Covenant to provide a full warden service. You may wish to take legal advice in this matter.

The offer of participation in an Advisory Committee is withdrawn as there is no requirement for such a committee in the Deed of Covenant.

Please be advised that the Guest Suite in the Apartment Block is specific to the Apartment Block and not part of the communal facilities.

Yours sincerely,

Dictated by the Management Committee and signed by Mrs. Josie Stewart on their behalf

cc: The bungalow residents

isle of Man Charity Registration No. 670

Company Limited by Guarantee Registration No: 060705 C

Chairman: David Carman, M.H.K. Warden: Mrs. J. Woods Clerk/Administrator: Mrs. J. Stewart

177

)0.

6 MULL, VlEAV KIRK micHAFJ, ISLE OF MAN 1M6 IAQ PHONE 01624 878944

178

G, Mutt View Kirk Michael 1M6 IAQ

October 30th MICHAEL comptissiomm.

November 1 3rh 2009

VOTE FOR PE 'ER it-Ayks. Dear Voter,

have been appmachecl by a number of people to stand for election and I should like to introduce myself to those who do not already know me. I am a retired scientist who was brought up in Kirk Michael and attended Michael Primary and Ramsey Grammar Schools. After leaving School I worked in agriculture before attending University where I gained my B.Sc. and PhD degrees. I have always been deeply interested ih village affairs and kept in regular contact during the time I lived off-Island Since returning to the village several years ago I have often attended Commissioners meetings and also contribute to the " Michael Messenger." I became a committee member of Michael Heritage Trust and for the past 3 years have been Chairman. lam a member of the Management Committee of Kirk Michael Community Housing Association (Canaan Court) and help in ifs fund raising activities.

131/h a tcqn 1 do as a M ic r tei Commissioner.

01 Whilst I acknowledge there are limitations to Michael Commissioners' power, I do feel the Commissioners should do all They can to hasten the provision of a proper Doctors. surgery in Nlichael village that will be available for ALI residents to use. This is fundamental for the quality of life of di members of the community and will continue to be my first priority as an elected representative .

Pi Heavy traffic in the village is a molar problem and we should investigate carefully and not rule out any solution which would lead to a better Now of traffic and make the village safer for pedestrians.

(3? Many residents are concerned about parking problems in the village. There should be clarification of and enforcement of existing car parking regulations. In addition, extra car parking areas should be considered. in any new housing developments suitable parking and wide street entrances should be a priority.

14.1 Kirk Michael now has with .the Carman Court complex, a place allowing older people to remain in the village, which they know. However; for younger residents there is a marked shortage of affordable, iong term rental accommodation for Mose who are not in a position to purchase. This is a great disadvantage to

179

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181

Registered Office;;:,



IM6 1FA


8th December, 2009

Mr. C. Renshaw, 21 Cannan Court, KIRK MICHAEL, Isle of Man.

Dear Mr. Renshaw,

Your letter dated 1st December has been received and -I have carefully noted the content.

The Management Committee have a Film-try duty of care to ensure that the charity number 670 the Kirk Michael Community Housing Association, is properly fUnded and with sound financial management

The Management Committee can not allow charitable funds to be used to provide a service .for which there is no legal requirement.

A full warden service is available to bungalow residents on payment of the prescribed rate of £3.50 per week and will take effect immediately a formal request is made to Mrs. J. Stewart.

I am sorry I cannot be more helpful.

A copy of your letter and this reply is being sent to all members of the Management Committee. This is the normal practise with correspondence relating to the bungalows.

Yours sincerely,

DAVID CANNAN


Chairman: David Cannan, M.H.K. Company Limited by Guarantee

Warden: Mrs, J. Woods



182

21..,Canna..n Court, Kirk Michael. 1M6 [FA. 10 / 12/ 09.

Dear David, May say how disappointed I was by your letter

oft 8th December. Because of our long, friendship I am desperately trying to understand your point of view, but must confess that. I find this di cu lt because you keep changing, your ground. Gone is any reference to a Maintenance Account and deficits. Instead you argue that the Committee have a primary duty to see the Assodation is property funded with sound financial management.

I couldn't agree more, but what has this to do with the contract signed with the Bungalow Owners ? Tell me Wile fe, in that contract there is any mention of aux.

responsible for any other funding than the agreed weekly payment which, in any case., is subject to increase in Hue with the rate of infla.tion. This year Bungalow Owners will pay just over £20,000 into the Association's funds.

The Committee should go clown on its knees each night and thank God that there are 12 bungalow owners generous enough to make such a huge, donation toward the work of the Association and ask so little in return. Apparently our generosity is not understood or appreciated, and that i really cannot understand or forgive.

183

Mrs MacMullen said that during your conversation with her she understood you to say that the bungalows were not part of the Sheltered Housing Complex. I cannot believe that you would say such a thing. Will you now please confirm that the bungalows are indeed an integral part of the Cannan Court Sheltered Housing Complex as defined in the caveat filed in the Deeds Registry dated 8/ 11/ 02 and attached to your letter dated 14/11/02.

Mrs MacMullen also understood you to say that we should not blame you for this dispute as you are only acting on the instructions of the Association's Accountant. Would you please let me have the name and address of this gentleman so that t can take this matter up directly with him.

I remain yours,

184

Regislead Office:

Cannan Cour-4,- Main Road

KIRK MICHAEL Isle of Man.

I M6 1 FA


Ilth Dec;embel.., 2009

'Mr. C. Renshaw, 2.1 Cannan Court, KIRK .MICHAEI.„ r.ste or Mari.

Ideas

Receipt is acknowledged of your letter dated lOth December, 2009 and a copy sent to each

member or the Management Committee.

A formal response to your letter will be sent to you during the next two weeks.

Yours sincerely,

V\„ 71;

CANNAN


185

KIRK MICHAEL COMMUN ITY

G ASS.C1ATION Telephone/Fax: (01624) 678193


KIRK MICHAEL, Isle of tan,

IM6 11-7A

[4th January> 21)10

Mr. C. Renshaw,

2 [ Carman Court,

KIRK MICTIAEI,

Isle of ivian,

(L),/

Dear

The Management Committee have recei-ved your [atest letter dated 10th Decombe..t. 2009 and

respond as 1.i..311ovvs:

The Management Committee have clearly stated to you to previous correspondence, their

dceiSiOn to adhere strictly to the lortns and conditions of the Maintenance Agreemont,

if the bungalow residents require additional. serviices of the resident warden then there is a

supplementary charge of :E3.50 per vvr!ck.

The Ntati;Ageracnt Cotmoittee now consider this matter to be closed.

Yours sincerely,

DAVID C.ANNAN


186

R.9_,gilteLedakff


KIRK MICHAEL., isle of Man.

IM6 1FA

KIRK MICHAEL C MMUN1TY MUM ASSOCIATION Telephone/Fax: (01624) 878193

27th May, 2010

Mr. and Mrs. C. Renshaw, Carillati Court,

KIRK .MICHAEL, Isle of Man.

Dear Me. and 1\At's. Renshaw,

In accordance with the Maintenance Agreement a Copy of the annual account for the period 1st January, 2009 to 31st December, 2009 is enclosed,

Yours sincerely,

DAVID CANNAN


187

Barregarrow House Barregarrow Crossroads

Kirk Michael Isle of Man

1M6 lAX

led or fay: +44 1624 878389 i

24 April 2010

The Directors and Committee Members Kirk Michael Community Housing Association Cannan Court Main Road Kirk Michael Isle of Man 1M6 IFA

Dear Sirs

Bungainvy maintenance account

At your request, I have reviewed the attached bungalow maintenance account, which has been prepared on the basis of the assumptions set out therein, for the year ended 31 December 2009, a copy of which is attached and initialled by me for identification purposes only. The account has been prepared by and is the sole responsibility of the Directors and Committee Members.

In my opinion, the attached bungalow maintenance account for the year ended 31 December 2009 has been properly prepared on the basis of the assumptions made.

Yours faithfnily. it •

M Gaidner BA FCA

188


Maintenance Account For the financial year ended 31 December 2009

1,1.1 Income Note

2009 £ £ £

2008 R. R.

2007 1

Service charges I 21,271 20,135 19,448

1,.1.2 Expenditure Salaries 2 16,509 16,713 15,629 Grass cutting 2 2,256 , 2,389 2,636 Care telephone and office supplies 2 914 1,020 1,033 Use of public rooms 3 749 749 749

(20,428) (20,871) (20,047)

Surplus for the year 843 (136) (599) 'Fransfer from/(to) Maintenance Reserve (843) 736 599


Maintenance Reserve

Balance brought forward

•---

2009 R.

(13,999)

2008 £

(3,640)

Balance brought forward written off 13,999

(3,640)

Provision for 2011 external redecoration (3,333)

(3,333) (3,640)

F.xpenditure on 2008 external redecoration (9,623)

(3,333) (13,263)

Transfer (to)/from Revenue Account in respect of current year 843 (736)

Balance carried forward (2,490) (13,999)

189

2007 I

(3,041)

(3,041)

(3,041)

(3,041)

(599)

T3;646

Assumptions

1 Service charges fbr 12 bungalows per audited financial statements as at 31 December 2009.

2 The bungalows represent 40% (12 out of 30) of the total number of units (18 apartments plus 12 bungalows) within the complex. This percentage has therefore been applied to the following items of expenditure per the audited financial statements:

salaries of the warden, secretary and cleaner care telephone and office supplies grass cutting

3 A nominal charge of £1.20 per week per bungalow has been made to cover the use of the public rooms by the bungalow residents.

4 During the year ended 31 December 2008, the exteriors of the bungalows were painted. With effect .from the year ended 31 December 2009, the intention is to provide for the cost of external redecoration equally over the three years immediately prior to the year of redecoration. The estimated cost of the external redecoration of the bungalows in the year ended 31 December 2011 is £10,000; consequently, £3,333 is being provided in each of the three financial years, 2009, 2010 and 2011.

190

Appendix 9

Telephone: 0117 917 8223 www.tvlicensing.co.uk Facsimile: 0844 800 5836 Bristol, 8S98 1TL

Our Reference: CLC17000527299/1M6 1FN10-10Lisa.

17 December 2009

Mr J D Q Cannan — Chairman Kirk Michael Community Housing Association Cannan Court, Main Road Kirk Michael Isle of Man IM6 1FA

Dear Mr Cannan

Re : Cannan Court - 1M6 1FA.

Thank you for your reply to 00 letter concerning your application for the concessionary television licence,

I note from your letter that Kirl; Michael Community Housing Association will no longer be providing the care or management for the bungalows at Cannan Court.

It has also come to my attention that you now state that the bungalows have been purchased under freehold, which means the accommodation does not, and never did qualify for the concession. This infor 'nation was not made known to us when the eligibility of the accommodation was originall), assessed.

It is therefore regretted that the concessionary television licence must be withdrawn from the bungalows at 21-32 Cannan Court, effective immediately.

With regard to the accommodation within 1-12 & 14-19 Cannan Court, I can confirm that from the information provided, the scheme continues to fully qualify the concessionary television licence. Please nota that should there be any changes in circumstances in the future, you are required to advise us accordingly.

Please find the concessionary television licence for 1-12 & 14-19 Cannan Court enclbsed.

Yours •incerely

t re, Lisa Taylor (Miss) Concessionary Licensing Centre

Vt. 10i05aliE

191

Appendix 10

Telephone: (01624) 685452

Fax: (01624) 629162

Your ref: Our ref: W.J1-1C/MQ/2010/409

(Please quote reference on all correspondence)

ATTORNEY GENERAL'S CHAMBERS

3R0 FLOOR, ST MARY'S COURT

HILL STREET, DOUGLAS

ISLE OF MAN IM1 1 EU

27th October 2010

Jonathan King Esq Clerk of the Select Committee on Service Charges and Freehold Property

Legislative Buildings Douglas ISLE OF MAN IM1 3PW

Dear Mr King

Thank you for your letter of the 25th October. 1 would respond to the questions you have raised as follows:-

"Freehold" is a term which attaches to land (and buildings erected on land) to indicate that such land and buildings arc owned absolutely by a person. That ownership may be subject to a mortgage, covenants, easements etc and evidence or that ownership is confirmed by registration of a deed of conveyance in favour of the owner in the General Registry or Land Registry. For the purposes of this letter it is appropriate to confirm that a freehold owner is able to grant a lease, for a term of years, out of the freehold ownership of the property.

"leasehold" is a term which attaches to land or buildings which a person holds as a

tenant and not as an absolute freehold owner. Typically, the leasehold interest will be set out in a written lease with the tenant covenanting to pay a rent and observe various covenants as to the use of the property during the currency of the lease. When the lease expires the leasehold interest reverts to the freehold owner who is known as the landlord.

A "service charge" is a charge imposed in respect of services carried out to a property, usually where the services are common to several properties; a prime

example would be where a block of flats is occupied by tenants and a service charge is imposed in respect of stairwells and common areas as well as services enjoyed by all the tenants. The service charge is typically calculated on a proportionate basis according to the size of the various leasehold properties. Again, typically, a management company will be responsible for providing the services in question with the various tenants being shareholders in that management company.

The Property Service Charges Act 1989 provides that a "service charge" is an amount payable by the tenant of a dwelling as part of or in addition to the rent:-

This communication may contain legal advice which is confidential and/or legally privileged. 'file recipient must not forward or copy it to any third party without the prior written permission of the author

193

(a) which is payable, directly or indirectly, for services, repairs, maintenance or insurance or the landlord's expenses of management; and

(b) the whole or part of which varies or may vary according to the relevant expenses.

"Relevant expenses" are the expenses or estimated expenses (including overheads) incurred or to be incurred in any period by or on behalf of the landlord in connection with the matters for which the service charge is payable.

The Act further provides that relevant expenses which are to be taken into account in determining the amount of the service charge must be reasonably incurred, be work of a reasonable standard and, if an overpayment is made, an adjustment must be made by repayment or reduction of a subsequent charge.

An application may made by a tenant to the Isle of Man Rent and Rating Appeal Commissioners for a determination with regard to the reasonableness of expenses which make up a service charge.

ii. A "service charge" as defined above would not be relevant to the ownership of properties by persons who owned the freehold of those properties - a service charge is relevant only to leasehold premises. It would however be quite possible for freehold owners to agree a scheme whereby each owner would covenant to be responsible for a certain proportion of the expenses of repair and maintenance of certain communal areas which are for the benefit of all of the freehold properties. Such obligations would he created by express provisions in the relevant deeds of conveyance.

iii. The petitioners are therefore correct when they state that the existing legislation, namely the Property Service Charges Act 1989, is only relevant in relation to leasehold property. There is no other Manx legislation which deals with service charges.

The Landlord and Tenant Act 1 985 of England imposes statutory limitations on the amount of service charges in a similar way to that provided for by our Property Service Charges Act and generally deals with the calculation of service charges in a similar manner to that set out in our 1989 Act.

iv. I am not aware of any definition of "sheltered accommodation" in Manx or Bnglish law.

would add that a search has been carried out in the Land Registry in relation to the properties referred to in the Petition, namely 23, 25, 26 and 28 Carman Court and T would confirm. that the titles to these properties are freehold. The title to the properties was owned by Kirk Michael Community Rousing Association, a company limited by guarantee with its registered office at Carman Court, Kirk Michael, but there is no reference to the imposition of any service charges payable to the company when the specific properties were conveyed to the freehold owners.

194 2

It is noted that the Petition refers to "the service charge payable by the freeholders" and I can only suggest that this reference is to charges or obligations which were agreed to be paid by the freeholders as a matter of private contract which is not registered in the Land Registry. The petitioners might be asked for further evidence as to the documentation or arrangements which have created "the service charge".

1 hope that this will be of assistance but if there arc any further points which arise no doubt you will let me know.

Yours sincerely

\V 3 H Corlett Attorney General

195

3

Appendix 11

Telephone: (01624) 685452

Fax: (01624) 629162

Your ref: Our ref: WHIC/MJC/2010/409

(Please quote reference no all correspondence)

ATTORNEY GENERAL'S CHAMBERS

3RD FLOOR, ST MARY'S COURT

HILL STREET, DOUGLAS

ISLE OF MAN IM1 I EU

15 December 2010

Jonathan King Esq. Clerk of the Select Committee on Service Charges and Freehold Property

Legislative Buildings Douglas .I.S.11 (N.,' MAN IM1 3PW

Dear Mr King

[-- RECEIVED 16 DEC MO

OFFICE OF THE CLERK OF TYNWALD

Thank you for your letter of 6th December with its enclosures.

The Deed of Conveyance dated the 17th February 1998 made between Kirk Michael Community Housing Association and Parkinson Limited sets out a number of covenants which are to be observed by the Purchaser and arty subsequent owner "unto whosoever (sic) hands the same may come". The covenants are set out in the Fourth Schedule to the Deed.

Whereas paragraph 4 of the Fourth Schedule provides that "any dwelling house erected on the property shall be used as a private dwelling house only as Sheltered Accommodation...", there is no reference to the - Purchasers having an obligation to observe the provisions of a ''Housing Association Maintenance Agreement".

Furthermore, in the Deed of Conveyance dated the il th December 1998 made between Parkinson Limited of the one part and Mr & Mrs Renshaw of the other part (a copy of which has been obtained from the General Registry), there is no covenant on the part of Mr & Mrs Renshaw that they should observe the provisions of any "Housing Association Maintenance Agreement". Mr & Mrs R.enshaw do covenant to observe certain covenants and conditions set out in the Fourth Schedule to the Deed of Conveyance but there is no reference to the covenants and Agreements referred to in the Housing Association Maintenance Agreement dated the 10th December 1.998 made between Kirk Michael Community Housing Association of the one part and Mr & Mrs 'Renshaw of the other part.

I am therefore at a loss to understand the justification for the statement in Recital 1(3) of the Maintenance Agreement that it was a term of the Deeds of Conveyance dated the 170 February 1998 and the 11th December 1998 (re ferred to above), that Mr & Mrs Renshaw should enter into the Maintenance Agreement.

The Maintenance Agreement deals with the use and enjoyment of "the comaninal facilities" and one would have expected that it ought to have been recorded in the General Registry and minuted on each Conveyance of a Cannon Court property, or referred to in the Land

This communication may contain legal advice which is confidential andlor legally privileged- "rhe recipient must not forward

or copy it to any third party without the prior written permission or the author

197

Registry so that any Purchasers would be on notice of the provisions of the Maintenance Agreement.

We have discovered one copy of the Maintenance Agreement which has been recorded in the General Registry, namely, one dated the 7`h December 1999 between Kirk Michael Community Housing Association of the one part and Muriel Clairemonte Hughes of the other part. A copy of this Agreement is attached.

It may well be therefore that some of the Purchasers of properties at Cannon Court have signed Maintenance Agreements but the vast majority do not appear to have been recorded, The Purchasers therefore may wish to consult with their Advocates to query this point and refer to any advice which was received at the time of their purchase regarding an obligation to observe the provisions of the Maintenance Agreement.

The further point you raise relates to the drafting of legislation to extend the Property Service Charges Act to cover freehold property. It is difficult to anticipate what the implications may be for drafting any such legislation in the absence of drafting instructions, but what I can say is that it is unusual for the owners of freehold properties to enter into Service Charges Agreements. Ordinarily, obligations to pay or contribute to the cost of maintaining freehold properties would be dealt with by way of covenants in the Deeds of Conveyance or transfer — they would not ordinarily be separate Service Charge Agreements which are more normally encountered in connection with Leasehold properties.

1 hope that this is will be of assistance.

Yours sincerely

4 W J U Corlett Attorney General

hnc

198 2

3555

ICHAE DEED made this .7 day of One thousand nine hundred and

NI( N V;(6 kTit\-I\i al‘:EGIn‘

at o3ro ss 1;"

REGISTERED

_.......ateasLaine...11,99.213Z136/EULMEL MLCHAFL COMMUNITY HOUSING ASSOCIATION a

CCO 1 S-5

■ OroiNte.141014111 • MI MO PM% 10/401, •ge•• -•••• ,••• • •••• and having its registered Office situate at

White Gables Curragh Road in the Parish of Ballaugh (hereinafter referred to as "the

Grantor" which expression unless inconsistent with the context shall include its

successors and assigns) of the one part and Muriel Clairemonte Hughes of Laureston

Lodge, Ballaquayle Road in the Borough of Douglas (hereinafter referred to as "the

Grantee" which expression unless inconsistent with the context shall include the said

Muriel Clairmonte Hughes and her administrators and assigns) of the other part...

I. WHEREAS:-

I) By Deed of Conveyance bearing date the 17 1 day of February 1999 the Grantor

did sell and convey unto Parkinson Limited ALL AND SINGULAR certain

hereditainonts part of the Whitehouse Estate in the Village District and Parish of

Michael the same being mere particularly set forth and described in the said Deed

of Conveyance (hereinafter referred to as "the Parkinson Estate)...

2) By Deed of Conveyance bearing date the ( day of LQAAAt,1999 the said

Parkinson Limited did sell and convey unto the Grantee ALL AND SINGULAR that

plat of land part of the Whitehouse Estate Michael aforesaid TOGETHER with the

dwelling house and all other buildings thereon erected which said hereditaments

and premises are more particularly set forth and described in the First Schedule

thereto (hereinafter referred to as "the Premises")...

3) The Grantor has agreed to provide certain facilities to the Grantee as hereinafter

described and the Grantee have agreed to enter into these presents and accept

such facilities upon the terms and conditions hereinafter appearing...

2. NOW THIS DEED THEREFORE WITNESSETH that in pursuance of the said

Agreement and in consideration of the sum of TWENTY EVE POUNDS (E25,00)

now paid by the Grantee (the receipt whereof is herebvecknowkidqedi and of is ti

the rents and the covenants hereinafter reserved anot:?containe Ond on the 4.7) " O n

cL

) cv Exarninec and certified as a true copy of the oriiinal ci

199

Grantee's part to be paid observed and performed the Grantor DOTH HEREBY

grant to the Grantee as follows:-

(a) full right and liberty at all times hereafter to use and enjoy without let or

hindrance the communal facilities in the Apartment Block erected on the

hereditaments retained by the Grantor (hereinafter referred to "the

Apartment Black") PROVIDED ALWAYS that any damage occasioned in

the exercise if such right is rectified to the satisfaction of the Grantor and

to use in the case of an emergency the telephone and intercom system

installed in the premises to notify the Warden residing in the Apartment

Block of such emergency...

3. AND the Grantor in consideration of the covenant with the Grantee as follows :-

fa)

to keep the communal facilities in the apartment Block in good arid

substantial repair and condition...

(b) to keep the gardens of the premises and all other premises part of the

KMCHA Estate as aforesaid tidy and properly mowed and cut free from

weeds and

fc) to paint the outside walls and exterior woodwork (including window

frames, doors and fascia boards) of the premises once in every three-year

cycle. The colour and materials of which are at the sole discretion of the

Grantor providing that any proposed change of colour shall be made only

with agreement of all the relevant owners._

4. AND the Grantee in consideration of the covenants and rights granted by the

Grantor to the Grantee by these presents 00TH HEREBY covenant with the

Grantor as follows:-

(a) To pay to the Grantor on a week to week basis in advance the sum of

TWENTY FIVE POUNDS (£25.00) without deduction or delay for a period

of ONE YEAR and thereafter such sum is to increase consistent with the

Examined and certified as a true copy of the original 200

rate of inflation the first of such payments to be made by the Grantee at

the date hereof...

(b) to pay all sums as shall be necessary and also all charges incurred by the

installation and use of a telephone and intercom system and any servicing

thereof at the premises to the Warden residing in the Apartment Bleck_

to perform and observe such reasonable rules and regulations as the

Grantor may from time to time prescribe by agreement with the Grantee

in connection with the Apartment Block ...

1W not at any time sell convey or part with possession of the premises or

any part thereof without the previous consent in writing of the Grantor

such consent not to be withheld SUBJECT to the following conditions on

the part al the Grantee being observed...

that any Purchaser purchasing the premises or receiving the

beneficial interest thereof shall acknowledge the requirement to

make a payment under the terms of Clause 4M hereof

IN WITNESS WHEREOF the Grantor and the Grantee have executed these presents this

the day month and year first before written...

EXECUTED by the Grantor in the presence of :

rer..,G2C

,cfr(

occ-a-r. C.--

EXECUTED by the Grantee in the presence of :

PETER R. WOOD

RaY !"...1.7-: OF MAN

ADVOCATL NOTARY PUBLIC

1-1


Dated 1999

Parish of Michael

Kirk Michael Community Housing Association "the Grantor"

and

MURIEL, CLAIRMONTE HUGHES "the Grantee"

HOUSING ASSOCIATION MAINTENANCE AGREEMENT

32 Carman Court Kirk Michael

Dickinson Cruickshank & Co, inc. Morris Maddrell Conveyancing Shop 33-35 Victoria Street Douglas 1M99 1SY


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March 2011

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