Katie Hoy v Fallon - Upper Tribunal Housing Property Decision

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  Katie Hoy against Declan Fallon and Kenneth Fallon trading as KEP (Kenneth Edward Properties) (Upper Tribunal - Housing and Property Chamber) [2026] UT 40 (24 March 2026)

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[2026] UT 40 | | |
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2026UT40 Ref: UTS/AP/25/0129 DECISION OF **** **** Sheriff F McCartney **** **** **** ON AN APPEAL IN THE CASE OF Miss Katie Hoy Appellant - and - Mr Kenneth Fallon and Mr Declan Fallon trading as KEP (Kenneth Edward Properties) Respondents FTS Case Reference: FTS/HPC/CV/24/1475 24 March 2026 Decision 1. The appeal is granted. The case is remitted to the First Tier Tribunal for Scotland (FTS) for a freshly constituted tribunal to hear the case anew. Introduction 2. This appeal arises from the decision of the FTS of 2 July 2025 when the FTS determined the case in the appellant's absence, largely finding against her. 3. The appellant was previously a tenant of the respondents. That tenancy was terminated in early 2025. The respondents say the appellant left the property in a state of disarray and requiring various repairs. The respondents claimed damages of ?2907.25. In July 2025 the FTS held a Case Management Hearing by telephone. In the appellant's absence, the FTS determined the claim and awarded the respondents damages of ?2767.25. Procedural history 4. The Case Management Hearing took place at 2.00pm on 2 July 2025. Both parties had been sent correspondence by the FTS administration explaining how to participate in the hearing, by phoning into a telephone conference call. The letter to the appellant was sent by email on 15 April 2025. 5. On 13 June 2025 the appellant contacted the FTS to ask for an adjournment of the hearing because of her high-risk pregnancy. The FTS refused her request. 6. On 2 July 2025, the respondents called into the conference call without difficulty. The appellant did not. The FTS proceeded with the hearing in her absence. Later that afternoon, at around 3:45pm, the appellant emailed the FTS administration. She asked when she would receive a call, indicating that she thought the FTS would phone her. When told the hearing had proceeded in her absence, there was then an exchange of emails leading to the FTS refusing a request to review its decision, and also refusing leave to appeal. Leave to appeal was subsequently granted by the UTS. The appeal hearing before the UTS 7. Both parties attended a hearing on 20 February 2026. Both were given time to lodge additional written submissions after that hearing if they wished. No further submissions were received. 8. The appellant's submissions were relatively short. There was relevant personal information as to her situation on the date of the FTS hearing. It was in the interests of justice that the appeal was allowed, and she was allowed to make her case on the merits of the claim against her. Whilst she accepted that the respondents had lodged photographs of alleged damage in the property around the time the tenancy was terminated, such photographs had to be understood against both the length of the tenancy and its condition when the tenancy commenced. Her tenancy in the property was over 4 years. Wear and tear was inevitable. She had photographs from the tenancy schedule before she moved in, showing the condition at that time. If she were allowed to challenge the merits of the claim, she had a defence. Not each part of the respondents' claim would succeed. The sum sued for was excessive. It would be unfair if the award against her was allowed to stand, given the FTS had only heard from one party. 9. The respondents (who are in a commercial partnership) opposed the appeal. The appellant's reason for not participating in the hearing did not stand up to scrutiny. She had given a different explanation before the UTS to that given to the FTS. Her opposition to the heads of damage claimed were misplaced. She had accepted that her dog had damaged some of the flooring and accepted leaving a large volume of rubbish in the property. In any event, it did not matter that she did not attend. The FTS had considered the merits of the claim. The FTS had asked various questions and considered each heading. The damages awarded by the FTS were fair and reasonable. It was not in the interests of justice for matters to be prolonged. Whilst that there had been a personal relationship between the parties prior to the tenancy ending (the appellant having been a former employee), mediation would not be considered on their side. The rules **** 10. The framework of applicable rules in this case is not straightforward. Those rules are found in First-tier Tribunal for Scotland Housing and Property Chamber (Procedure) Regulations 2017/328. Some of the rules apply to all types of case before the FTS, and others only to selected types of application. 11. One rule that applies to all types of applications before the FTS is the overriding objective, which reads as follows: "2. -- The overriding objective (1) The overriding objective of the First-tier Tribunal is to deal with the proceedings justly. (2) Dealing with the proceedings justly includes-- (a) dealing with the proceedings in a manner which is proportionate to the complexity of the issues and the resources of the parties; (b) seeking informality and flexibility in proceedings; (c) ensuring, so far as practicable, that the parties are on equal footing procedurally and are able to participate fully in the proceedings, including assisting any party in the presentation of the party's case without advocating the course they should take; (d) using the special expertise of the First-tier Tribunal effectively; and (e) avoiding delay, so far as compatible with the proper consideration of the issues." 12. The rule regulating Case Management Discussions also applies to all types of case: "17. -- Case management discussion (1) The First-tier Tribunal may order a case management discussion to be held-- (a) in any place where a hearing may be held; (b) by videoconference; or (c) by conference call. (2) The First-tier Tribunal must give each party reasonable notice of the date, time and place of a case management discussion and any changes to the date, time and place of a case management discussion. (3) The purpose of a case management discussion is to enable the First-tier Tribunal to explore how the parties' dispute may be efficiently resolved, including by-- (a) identifying the issues to be resolved; (b) identifying what facts are agreed between the parties; (c) raising with parties any issues it requires to be addressed; (d) discussing what witnesses, documents and other evidence will be required; (e) discussing whether or not a hearing is required; and (f) discussing an application to recall a decision. (4) The First-tier Tribunal may do anything at a case management discussion which it may do at a hearing, including making a decision." 13. Assigning a Case Management Hearing is therefore discretionary. If a Case Management Hearing is held, the FTS can determine the application without fixing a hearing. If a hearing is fixed, rule 24 regulates the procedure at hearings, including regarding calling and cross- examination of witnesses. 14. In addition to case management powers, the FTS also have two distinct powers to review or recall decisions. 15. The power to review is regulated by rule 39, applying to almost all types of application (applications regarding the exercise of powers to allow landlords to obtain access to their property are excluded). In summary, rule 39 requires a review application to be lodged within 14 days of the decision being sought to be reviewed or the sending of the reasons to the parties. Unless the FTS consider the review application to be wholly without merit, it must afford a period for representations on the review application by the other party, with the FTS given discretion as to how to permit such representations. The FTS are thereafter given discretion to determine the review application on papers without a hearing. There is no right of appeal to the UTS regarding a review decision of the FTS (section 43(4) of the Tribunals (Scotland) Act 2014). 16. The power for the FTS to recall decisions is found in rule 30. Recall can only be sought if a party did not participate in the proceedings or attend or be represented at a hearing where the decision was made (rule 30(1)). The application to recall must explain why it is in the interests of justice to recall the decision made (rule 30(2)) and be made within 14 days of the decision sought to be recalled (rule 30(14)) unless extended on cause shown (rule 30(15)). A party can only make one application for a recall during the same proceedings (rule 30(16)). 17. The rule regarding recall only applies to a limited range of cases, including applications before the FTS on the adaptations of rented houses, assured tenancies, regulated tenancies, tenancy deposits and private residential tenancies. Where the FTS is dealing with a dispute arising from a private residential tenancy, the power to recall a decision applies to any application where the FTS is exercising its powers under section 71 of the Private Housing (Tenancies) (Scotland) Act 2016. By that section, the FTS can determine any civil proceedings that the Sheriff Court would otherwise have determined regarding the residential tenancy (such disputes now being allocated to the FTS rather than the Sheriff Court by virtue of section 71(1)(b) of the 2016 Act). 18. Accordingly, the power of the FTS to recall a decision applies to applications arising from a residential tenancy. Decision **** 19. The grant of leave to appeal focussed on the decision of the FTS in refusing a review of the decision of 2 July 2025. That was an error on the part of the UTS. Review powers are not a matter that can be considered by the UTS given the operation of section 43(4) of the Tribunals (Scotland) Act 2014. 20. Notwithstanding that error, I consider the FTS fell into an error of law for the following reasons. 21. It is not disputed that the appellant did not phone into the hearing but contacted the FTS later that afternoon being anxious as to having missed a call from the FTS to join the hearing. Whilst there was further information given to the UTS, I reject the respondents' submission that her explanation lacks credibility. I do not consider the appellant sought to mislead either the FTS or the UTS. The explanation before the UTS was compelling. It is of a sensitive nature. It is not necessary, as the respondents suggested, to enquire into the truth of matters. 22. For the FTS to proceed with the hearing, the FTS had to be satisfied it was complying with the overriding objective within the rules to determine the proceedings justly. I am not persuaded the FTS were correct to proceed in the appellant's absence. I note the justification relied on the previous unsuccessful attempt by the appellant to adjourn the hearing, perhaps inferring that the appellant had chosen not to take part given that refusal. 23. By proceeding in the absence of the appellant, the FTS were deprived of understanding the full factual picture. The FTS were aware the tenancy had lasted for 4 years. It could not hear opposing arguments as to what elements claimed for might be more properly attributed to wear and tear rather than damage by the appellant. It could not hear arguments as to whether the sum sued for was excessive, and whether the respondents had properly mitigated their loss. 24. I accept that the rule regarding the overriding objective not only requires the FTS to deal with proceedings justly, but also places a burden on the FTS to reconcile objectives that may conflict; in this case the FTS would have been mindful of avoiding delay as they are obliged to consider by rule 2(2)(e)) but also to their duty to ensure parties are able to fully participate in the proceedings (rule 2(2)(c)). For the appellant, this is a significant sum. The FTS were aware she was pregnant. Whilst it was entitled to consider and determine her application to adjourn the Case Management Discussion, her subsequent absence should have given the FTS cause to pause and consider the overriding objective. The FTS clerks could have been directed to attempt to contact the appellant to ascertain if she was intending to join the hearing. Proceeding in the absence of the appellant was an error of law. I uphold the appeal on that basis and remit the matter to the FTS to hear the application anew. 25. Otherwise, I note that, if the tenancy was a private residential tenancy, it is unfortunate that this matter has resulted in an appeal given it is possible that the decision could have been recalled. The correspondence between the appellant and the FTS was somewhat prolonged. After several emails from the appellant, the FTS acknowledged her emails on 18 July 2025, advising the administration had referred her correspondence to a FTS judge. On 23 July the FTS wrote to the appellant asking if she wished to review the decision, seek permission to appeal or both. On the same day the appellant told the FTS she wished to "appeal both". It is unfortunate the FTS administration did not prompt a discussion with the appellant as to whether she was seeking to recall the decision. 26. I appreciate the frustrations of the respondent, although note that earlier hearings were adjourned to suit their availability. However, it is in the interests of justice that the appellant is allowed to participate in a full hearing on the merits. It may also be helpful for the respondents to reconsider their approach to mediation. 27. The appeal is upheld. The matter is remitted to the FTS for a new hearing before a differently constituted tribunal. The clerk to the Upper Tribunal for Scotland is directed to send photographs lodged by the appellant with the FTS, so that evidence is available to the FTS. A party to this case who is aggrieved by this decision may seek permission to appeal to the Court of Session on a point of law only. A party who wishes to appeal must seek permission to do so from the Upper Tribunal within *30 days** of the date on which this decision was sent to him or her. Any such request for permission* must be in writing and must (a) identify the decision of the Upper Tribunal to which it relates, (b) identify the alleged error or errors of law in the decision and (c) state in terms of section 50(4) of the Tribunals (Scotland) Act 2014 what important point of principle or practice would be raised or what other compelling reason there is for allowing a further appeal to proceed. Sheriff McCartney Member of the Upper Tribunal for Scotland

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