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England and Wales Court of Appeal (Civil Division) Decisions
You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Blumenthal v Church Commissioners for England  EWCA Civ 1688 (13 December 2004)
Cite as:  EWCA Civ 1688
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COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM
His Honour Judge Michael Rich QC
The Lands Tribunal
Strand, London, WC2A 2LL
B e f o r e :
THE RIGHT HONOURABLE LORD JUSTICE CARNWATH
SIR WILLIAM ALDOUS
| ALEXIS MICHAELA CECILE BLUMENTHAL
|- and -
|THE CHURCH COMMISSIONERS FOR ENGLAND
Smith Bernal Wordwave Limited, 190 Fleet Street
London EC4A 2AG
Tel No: 020 7421 4040, Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
Kirk Reynolds QC (instructed by Black Graf & Co) for the Respondent
Crown Copyright ©
SIR WILLIAM ALDOUS :
The Background Facts
"1. As to part of the Basement and the Ground floor and First Floors as the headquarters of the Royal Society of Literature with Club rooms on the said ground and first floors and with part of the basement as a self-contained flat for private residential occupation by the Society's secretary.
2. As to the second floor as a self-contained flat in one private residential occupation only.
3. As to the third and fourth floors as a self-contained maisonette in one private residential occupation only and
4 as to the remainder of the said basement as a self-contained flat for the lodging of one housekeeper or caretaker only employed by their Secretary in or about the messuage and such housekeeper's or caretaker's husband or wife as the case may be but having no other person living with him or her and no consideration by way of rent or any other payment or return shall be received other than actual service as housekeeper or caretaker.
"13. That neither the demised premises nor any part thereof shall be used for any illegal immoral or improper purpose or for or as a hospital or charitable institution or for the teaching of singing or music of any sort or for any trade business or manufacture or profession whatsoever but that the Lessee will keep and use the demised messuage and any additions thereto as follows:
(1) As to part of the Basement and the Ground Floor and First Floors as the headquarters of the Royal Society of Literature with Club rooms on the said Ground Floor and First Floors and with the part of the Basement as a self-contained flat for private residential occupation by the Society's Secretary.
(2) As to the Second floor as a self-contained flat in one private residential occupation only.
(3) As the Third and Fourth floors as a self-contained Maisonette in one private residential occupation only.
(4) As to the remainder of the said Basement as a self-contained Flat for the lodging of one Housekeeper or Caretaker only employed by the Lessee in or about that part of the messuage occupied by them and such Housekeeper's and Caretaker's Husband or Wife as the case may be but having no other person living with him or her and no consideration by way of rent or any other payment or return shall be received other than actual service as Housekeeper or Caretaker.
And will not further sub-divide the demised premises or use the same for any other purpose whatsoever.
And also will keep maintain and treat the entrance hall … and any other parts … which are intended to be used in common by tenants in a style and manner suitable and appropriate for high class residential Flats and Maisonettes and will in particular cover and keep covered with carpet or other material in good condition suitable for Flats and Maisonettes of the class aforesaid the said staircase and hall and any other such parts of the demised premises as are usually so covered … keep the front door or doors always closed excepting only when required to be opened and keep such door or doors and the outside entrances generally in such condition as to appear from the outside to be the door or doors and entrances to a high class private dwelling house in one occupation …
And also will keep and use any forecourt garden or ground forming part of the demised premises as and for private ornamental forecourt garden and ground only in connection with the demised messuage."
"1.2.1 In lieu of paragraph 13(1) aforesaid
'1. As to the part of the basement and ground and first floors of the Premises formerly occupied by the Royal Society of Literature
1(a) As to the part of the basement as a self-contained flat in private residential occupation
1(b) As to the ground floor as a self-contained flat in private residential occupation
1(c) As to the first floor as a self-contained flat in private residential occupation and
1(d) Without prejudice to the foregoing as to the part of the basement and ground and first floors of the premises normally occupied by the Royal Society of Literature as a self-contained flat in private residential occupation
1(e) without prejudice to the foregoing as to the part of the basement and the ground floor of the premises formerly occupied by the Royal Society of Literature as a self-contained flat in private residential occupation.
1(f) Without prejudice to the foregoing as to the part of the ground and first floors of the premises formerly occupied by the Royal Society of Literature as a self-contained flat in private residential occupation
1.2.2 In lieu of paragraph 13(4) aforesaid
(4) As to the remainder of the basement as a self-contained flat in private residential occupation … "
i) three flats, one on each floor, or
ii) one dwelling on all three floors, or
iii) two dwellings, one on the basement and the ground floors and the other on the first floor, or
iv) two dwellings, one on the ground floor and first floors and the other in the part basement.
Additionally the caretaker's flat, as designated in the lease, in that part of the basement not let to the Royal Society of Literature was permitted to be used as a self-contained flat in private residential occupation.
"84. Power to discharge or modify restrictive covenants affecting land
1. The Lands Tribunal shall (without prejudice to any concurrent jurisdiction of the court) have power from time to time, on the application of any person interested in any freehold land affected by any restriction arising under covenant or otherwise as to the use thereof or the building thereon, by order wholly or partially to discharge or modify any such restriction on being satisfied"
"20. I turn therefore to consider the factual context in which the lease was granted. It followed the wording already contained in the head lease granted to Donald Hamilton on 5 October 1951. If the covenants had been only those contained in sub paragraphs (2) and (3) referring to the second floor and to the third and fourth floors respectively, I do not think that one would naturally read those obligations as positive, amongst other reasons because of the use of the adverb 'only'. Mr Thom correctly points that the adverb may qualify 'in one residential occupation only' rather than a whole covenant 'to keep and use as a self-contained flat in one residential occupation only'. Nevertheless, on balance I think that the covenants at sub paragraphs (2) and (3) are more naturally read as negative rather than positive, and certainly there is no such change of language as to make it sensible to read sub-paragraphs (1) and (4) as positive if one reads (2) and (3) as negative. But the head lessee was entering into the covenant at sub paragraph (1) before, as far as the evidence of the documents goes, there was any obligation on the part of the RSL to occupy at all. At the date when the applicants' predecessors entered into the 1952 lease an underlease had been taken by the RSL but for a term less than half the term granted to and taken by the applicant's predecessors. It is improbable that the parties intended that the covenantor should enter into an obligation which he had no power to comply with, and I would not so construe the covenant unless the words used compel such construction.
21. That it should not be so construed is, in my judgment, reinforced by further consideration of the documents. Firstly the form of covenant itself, though pointing to activity rather than restraint in using the active rather than a passive voice introduces an inconsistency in specifically referring to 'the Lessee', because the only active keeping and using that the Lessee can do on premises as the Headquarters of the RSL is to keep them available by not using them for other purposes. The underlease, subject to which the lease was granted meanwhile contained a covenant in non-matching form, 'will not use or permit or suffer to be used the demised premises or any part thereof for an illegal or immoral purpose nor as a hospital for teaching or singing or music of any sort nor for any trade business manufacture or profession whatsoever but will keep and use the demised premises for the general as and for the general purpose of the tenant and its members'. The underlying obligation in the underlease is less specific than the requirements of sub paragraph (1) at paragraph 13 of the lease which the lessee had no right to enforce. The RSL moreover had a right to assign. There is room for argument, which is not necessary to resolve, as to whether this was limited to the circumstances of the RSL being unable to continue its activities. At the least to construe the obligation in the lease as a positive obligation rendered the Lessee liable to find himself in breach of the covenant for circumstances which he had no power to prevent. That at least makes an intention to create a positive intention unlikely.
22. Although, having regard to the agreed position of counsel I have directed my attention firstly to the original provisions of paragraph 13, I think that the substituted provisions as drafted point the same way. The revised sub-paragraph (4) does not use the word 'only' as sub-paragraphs (2) and (3) do. That would be more consistent with a positive covenant. But the formulation of the substituted paragraph (1) is far from clear to impose a positive obligation. The expression 'without prejudice' to introduce alternative uses which are acceptable is, I think, a misuse of language, on any basis, but it must mean that the alternative which it introduces may be substituted for the 'foregoing'. If the foregoing was intended to be an obligation rather than a permission, the use of 'without prejudice to the foregoing' seems to me to be particularly inapt.
23. For the above reasons I conclude that the user covenant is not a positive covenant but accordingly is a restrictive covenant, and that the Tribunal does have jurisdiction to modify in accordance with s.84 of the Act."
"As I have said, the covenant falls into several parts. The first part is plainly restrictive. Mr Lightman argued that the second part is not restrictive but positive. He pointed to the words 'shall be kept and used' and said that those words amounted to a continuing obligation to carry out the purposes. That cannot, he submitted, be called a restrictive covenant. The law is familiar with positive covenants in leases, perhaps especially in user covenants. A covenant to use a particular shop for some particular trade requires the tenant not to leave the shop empty but to actively carry on the trade. Obviously a covenant to carry out some purpose, as here to provide dwellings for the working classes, does not require that every part of the demised premises should always be occupied by such persons. Premises can legitimately stand vacant between the tenancies. Premises may be required to be vacant for purposes of redecoration. It is even possible that a whole block of flats might be required to be empty for a considerable period of time if that were necessary for the purposes of repair to the block, or for better equipping the block to provide adequate dwelling. Such intervals would not mean that the City of Westminster was not keeping and using the blocks for the proper purpose. The City of Westminster merely needed an interval while the purpose was pursued.
But in my judgment the obligation here undertaken is a positive obligation. The word 'used' carries to my mind a connotation of a duty to use. The whole phrase suggests to me, what in my view is shown by the heads of agreement and other material in evidence to be the case, that the purpose of the grant was to provide buildings in which the City of Westminster would keep tenants. It is not a covenant that could be performed by keeping the buildings empty with a view to reducing expenditure on maintenance. In my judgment the contrast in wording between the negative prohibition in the first lines of the covenant followed by the words 'but that' shows a clear shift of meaning from restraint to activity. It is of course true that a duty to use land for some purpose necessarily means that the land shall not be used for other purposes. Nevertheless the duty to use remains a positive obligation although a negative implication may flow from it … It is not in dispute that the Lands Tribunal can only modify restrictive covenants. In my judgment this part of sub-clause (IX)(a) is a positive covenant and as such cannot be the subject of an application to the Lands Tribunal."
"An area of 1.3 hectares adjacent to the playing field and amenity open space areas shall be reserved for school purposes."
"It is said to be positive because it involved a positive obligation to define the area and reserve it. I have had some difficulty in following this argument and I reject it without hesitation. One only has to ask the question: 'were the respondents free to build residential houses on the land?' to get the answer: 'No they were not!' If that is not restrictive I do not know what is."
"The fact that a particular construction leads to a very unreasonable result must be a relevant consideration. The more unreasonable the result the more unlikely it is that the parties can have intended it, and if they do intend it the more necessary it is that they should make that intention abundantly clear."
Lord Justice Waller I agree.
Lord Justice Carnwath: I also agree.