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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Broadway Investments Hackney Ltd v Grant [2006] EWCA Civ 1709 (20 December 2006) URL: https://www.bailii.org/ew/cases/EWCA/Civ/2006/1709.html Cite as: [2006] EWCA Civ 1709 |
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COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE SHOREDITCH COUNTY COURT
HIS HONOUR JUDGE COTRAN
ON APPEAL FROM DISTRICT JUDGE MANNERS
Strand, London, WC2A 2LL |
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B e f o r e :
LORD JUSTICE LLOYD
and
LORD JUSTICE LEVESON
____________________
BROADWAY INVESTMENTS HACKNEY LIMITED |
Appellant / Claimant |
|
- and - |
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LOWELL GERALD GRANT |
Respondent / Defendant |
____________________
WordWave International Ltd
A Merrill Communications Company
190 Fleet Street, London EC4A 2AG
Tel No: 020 7421 4040 Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
David Watkinson (instructed by Dowse & Co) for the Respondent
____________________
Crown Copyright ©
Lord Justice Lloyd:
Introduction
The proceedings
"It is a business tenancy, so I do not have all the rights I would have if it was residential, if it counted as a residential tenancy, which it does not. This is a business tenancy and I would have to be looking at getting the rest of this £25,000 paid within 2 years or so at £1,000 per month which you simply cannot afford."
She also ordered payment of the sum then due, and costs assessed at £7,000, and refused permission to appeal.
The Defendant's appeal
"(1) Due consideration not given to the full facts of the case.
(2) As a result of the failure of the Claimants to properly identify themselves arrears accrued over a 3-4 year period. In the interests of justice a similar period for repayment is appropriate.
(3) Due to the failings on the part of the Claimants, a further review of the validity of the rent review is required and necessary.
(4) Due consideration should be given to the circumstances relating to the original lease terms, the rent increases and the rent review.
(5) My application dated 24/10/05 was dismissed without being properly considered."
In a separate document submitted at the same time, called a skeleton argument, an offer was put forward of £10,000 immediately, together with staged payments to achieve full settlement.
Extension of time for appealing
Permission to appeal
The appeal, and amendment of the grounds of appeal
"(6) whether the learned District Judge failed to properly consider and determine whether the Defendant's tenancy was within Part IV Housing Act 1985 or Part I Housing Act 1988."
The legislation
"Subject to the provisions of this Act, this Part of this Act applies to any tenancy where the property comprised in the tenancy is or includes premises which are occupied by the tenant and are so occupied for the purposes of a business carried on by him or for those and other purposes."
"A tenancy under which a dwelling-house is let as a separate dwelling is a secure tenancy at any time when the conditions described in sections 80 and 81 as the landlord condition and the tenant condition are satisfied."
That is, however, subject to exceptions set out in Schedule 1, of which paragraph 11 is as follows:
"A tenancy is not a secure tenancy if it is one to which Part II of the Landlord and Tenant Act 1954 applies."
"A tenancy under which a dwelling-house is let as a separate dwelling is for the purposes of this Act an assured tenancy if and so long as
(a) the tenant or, as the case may be, each of the joint tenants is an individual; and(b) the tenant or, as the case may be, at least one of the joint tenants occupies the dwelling-house as his only or principal home; and(c) the tenancy is not one which, by virtue of subsection (2) or subsection (6) below, cannot be an assured tenancy."
Subsection 1(2) refers to exceptions set out in Schedule 1. Paragraph 4 of that Schedule is:
"A tenancy to which Part II of the Landlord and Tenant Act 1954 applies."
Did Part II of the 1954 Act apply to the tenancy after January 2000?
i) In the first case, the landlords let to the tenant a residential flat consisting of a bed-sitting room, bathroom and toilet and an entrance hall with a cooker in it. The tenant was a partner in a business which did not have trade premises and which the partners carried on from their respective homes. The tenant installed a telephone in the flat, and placed office equipment consisting of a table, a typewriter, files and a lot of paper in the entrance hall. Notepaper headed with the name of the business gave as the telephone number of the business that of the flat. The tenant issued business statements on the notepaper from the flat and had frequent visitors to the flat carrying brief cases. There was evidence that a considerable volume of trade was carried on from the flat.ii) In the second case, the residue of a lease of a maisonette constructed as a separate dwelling was assigned to the tenant. The tenant was a medical practitioner who had his consulting rooms nearby and who took the lease in order to live in the maisonette as his home. However, he wished to see patients at the maisonette occasionally and obtained the landlords' consent to do so. He occupied the maisonette as his home, but entered the address of both his consulting rooms and the maisonette in the Medical Directory and printed the telephone numbers for both addresses on the separate notepaper he had for each address. In fact the only professional use he made of the maisonette was to see a patient there once or twice a year in an emergency.
"There was much discussion before us as to the meaning of the Business Tenancy Act (I use those words because I think 'Landlord and Tenant Act 1954, Part II' is a little confusing), especially the word 'purposes' in section 23(1); and the time or times at which those 'purposes' had to exist; and the effect of a change by the tenant in the use to which he put the property. Could he take himself in or out of the Act at his option? I found all these matters so confusing that I do not propose to attempt a solution today. I am only going to take four simple illustrations to show how the statute works; for they will suffice for our present cases.
First, take the case where a professional man is the tenant of two premises: one his office where he works; the other his flat, conveniently near, where he has his home. He has then a 'business tenancy' of his office; and a 'regulated tenancy' of his home. This remains the situation even though he takes papers home and works on them at evenings or weekends and occasionally sees a client at home. He cannot in such a case be said to be occupying his flat 'for the purposes of' his profession. He is occupying it for the purpose of his home, even though he incidentally does some work there: see Sweet v Parsley [1970] AC 132 at 155 per Lord Morris of Borth-y-Gest.
Second, take the case where a professional man takes a tenancy of one house for the very purpose of carrying on his profession in one room and of residing in the rest of the house with his family, like the doctor who has a consulting room in his house. He has not then a 'regulated tenancy' at all. His tenancy is a 'business tenancy' and nothing else. He is clearly occupying part of the house 'for the purposes of' his profession, as one purpose; and the other part for the purpose of his dwelling as another purpose. Each purpose is significant. Neither is merely incidental to the other.
Third, suppose now that the first man decides to give up his office and to do all his work from his home, there being nothing in the tenancy of his home to prevent him doing it. In that case he becomes in the same position as the second man. He ceases to have a 'regulated tenancy' of his home. He has only a 'business tenancy' of it.
Fourth, suppose now that the second man decides to give up his office at home and to take a tenancy of an office elsewhere so as to carry on his profession elsewhere. He then has a 'business tenancy' of his new premises. But he does not get a 'regulated tenancy' of his original home, even though he occupies it now only as his home, because it was never let to him as a separate dwelling, unless the landlord agrees to the change."
"It is obviously a very fine distinction, but the words in section 23 seem to have been used in an attempt to make it absolutely clear that activities on the premises which are merely incidental to residential occupation do not bring the premises within the section although they may properly be described as using them for carrying on a trade or business. The businessman, for example, who takes work home in the evening which he does in a study set aside for the purpose may very well be using the premises partly for carrying on thereat a business, but he could scarcely be said to be occupying the premises for the purposes of a business, any more than the person who watches the television regularly every evening can be said to be occupying his house for the purpose of watching television. It is only if the activity is part of the reason for, part of his aim and object in occupying the house that the section will apply. Lord Morris of Borth-y-Gest expressed the concept clearly when dealing with the meaning of the words of section 5 of the Dangerous Drugs Act 1965 in Sweet v Parsley [1970] AC 132 at 154–155:
'It seems to me, therefore, that the words "premises … used for the purpose of smoking cannabis" are not happily chosen if they were intended to denote premises in which at any time cannabis is smoked. In my opinion, the words "premises used for any such purpose …" denote a purpose which is other than quite incidental or casual or fortuitous; they denote a purpose which is or has become either a significant one or a recognised one though certainly not necessarily an only one.'
As is so often the case in matters of this kind it will in the end come down to a question of degree, and borderline cases will produce their usual difficulties."
Geoffrey Lane LJ agreed with Lord Denning as to the result on the facts of the two cases, as did Eveleigh LJ.
The landlord's alternative reliance on ground 8 under the Housing Act 1988
The conduct of the proceedings
"You are entitled to the protection of the law and he is entitled to the protection as a very long standing tenant and he has more rights than you do, as you well know. He has residential rights and he has shop premises rights." (transcript 6 February, appeal bundle page 76)
At the third hearing he made the comment, unfortunate on the part of a judge, even in passing, "I do not care what the law says" (transcript 12 April appeal bundle page 125).
"In my judgment it is a serious error in this case because this man had been a tenant of Hackney for a very very long time, paying his rent. The problem arose when the new owners, the claimants, took over. He wanted to buy, but he did not buy, so looking at it from a justice point of view it seems that by this judgment this man was deprived of a right which he clearly had"
by which in context the judge appears to mean the right to statutory protection for his residential property. As with a number of the judge's other observations, that displays a distinctly one-sided view of the case, and an assumption that the tenant did have statutory protection, which had not been investigated, still less established.
Lord Justice Leveson
Master of the Rolls