Landlord and Tenant Act 1954, Part II, section 30(1)(g) — Application by tenant carrying on a cafe business for a new lease — Objection by landlord on the ground that she required the premises partly to carry on a business of her own and partly for residential purposes — Appeal by tenant from decision of assistant recorder dismissing his application — The tenant’s cafe was on the ground floor of a two-storey house, the upper part being occupied as a residence by the landlord and her husband — The accommodation upstairs was effectively three rooms, kitchen, bathroom and lavatory — The accommodation downstairs was divided into four rooms and had been let as a cafe by a seven-year lease granted on August 4 1980 and now vested by assignment in the tenant — The landlord was 61 years of age and her husband, aged 57, suffered from diabetes and was infirm in his legs — Their intention was to use two of the rooms downstairs as a bedroom and sitting-room for the husband and to increase their income by operating the other two rooms as a cafe, although on a reduced scale
question was whether the landlord had shown a genuine intention under section
30(1)(g) in accordance with the authorities — The intention must be a firm and
settled intention which the judge holds to be capable of being carried out in
the reasonable future in the circumstances that would prevail when possession
was achieved by the landlord — The judge held in this case that there was such
a genuine intention, but his decision was attacked by the tenant on appeal — It
was submitted on behalf of the tenant that the facts were such that the judge
could not properly conclude that the landlord’s intention was capable of being
carried out in any sensible way — The husband had retired and was infirm, the couple
were pensioners, there might be difficulties about financing the equipment for
the two-room cafe, the financial advantages of the change were doubtful, and
the landlord had not had anything to do with the catering trade for a great
many years, although some 30 years ago she had lent a hand in the cafe
Court of Appeal that it was quite impossible to set the judge’s decision aside
— He had considered all the points put forward and had accepted that the
chances of success in the catering project were doubtful — However, the
landlord needed the accommodation downstairs and had a powerful wish to obtain
it — Although the plans were ill thought out and might well fail, it could not
be said that they were so unrealistic as not to be genuine — Appeal dismissed
No cases are
referred to in this report.
This was an
appeal by the tenant, Geoffrey Frank Cox, the applicant below, from the
decision of Mr Assistant Recorder Milligan dismissing the appellant’s
application for a new tenancy of premises at 133 Upper Hale Road, Farnham,
Surrey, on which he was carrying on a cafe business. The respondent landlord,
Mrs Kathleen Binfield, objected under section 30(1)(g) of the Landlord
and Tenant Act 1954 to the grant of a new tenancy.
Derek Marshall
(instructed by S P Groves & Co, of Farnham) appeared on behalf of the
appellant; Nicholas Wood (instructed by Doggett Hawke & Co, of Basingstoke)
represented the respondent.
Giving
judgment, O’CONNOR LJ said: This is an appeal by the tenant of business
premises against a decision of Mr Assistant Recorder Milligan sitting at the
Aldershot and Farnham County Court on March 4 1988. The appellant applied for a
new lease of premises in Farnham which he was running as a cafe. The landlord
objected to the grant of a new lease under section 30(1)(g) of the
Landlord and Tenant Act 1954 on the grounds that she required the premises
partly to carry on a business of her own and partly as a residence.
The facts
underlying the case are very simple. This is a two-storey house in Farnham, and
for a great many years the landlord and her husband had lived in the upper
floor, which consists effectively of three rooms, kitchen, bathroom and
lavatory. The downstairs, which is divided into four rooms, had been let out as
a cafe. The lease in question was made for seven years on August 4 1980 and by
assignment came down to the present appellant. There is a long history as to
how he had come to be the tenant, but it is not disputed that he was the tenant
and a proper person to apply for a new lease. It is unnecessary to go into that
history, which was very unfortunate for Mr Cox because, on the face of it, he
had had a great deal of money taken from him by people who had nothing to do
with the landlord. But nothing turns on that.
The landlord
is Mrs Binfield. She is 61 years of age and her husband is 57. The evidence was
that he suffers from diabetes and is infirm in his legs. Mr and Mrs Binfield
wanted to use two of the rooms downstairs as a bedroom and sitting-room for
him. There is a downstairs lavatory; there is no bathroom downstairs as yet,
and there were no plans for putting one in. Mr and Mrs Binfield intended to
increase their income by operating the other two rooms as a cafe on a reduced
scale from that which Mr Cox had been running since 1983.
The sole
question in the case was whether this was a genuine intention, as is required
by the law under para (g) of the subsection. The learned judge directed
himself correctly on the law. It is not disputed that he did that. He found
that there was a genuine intention, as required by the decided cases, in the
landlord. Mr Marshall has submitted that he fell into error in so doing, really
on one main ground. He submits that the facts the learned judge found as to the
probabilities of what would happen when the landlord got possession were such
that he could not properly conclude that the intention was capable of being
carried out in any sensible way. Therefore it did not satisfy the requirements
of genuineness which is found in the cases. This topic is so well trodden over
in the cases that it is unnecessary for me to cite authority. Objectively the
judge must be able to say that this intention is one which is capable of being
carried out in the reasonable future in the circumstances which will prevail when
possession is achieved by the landlord.
What was said
was, first, the husband has retired. Mr and Mrs Binfield are pensioners and
they have been living in part upon the rent from the cafe, which was quite
substantial. Indeed, it was proposed that £3,500 should be the rent under a new
lease. Second, it was said that the landlord would not be able to finance the
equipment of a two-room cafe. The trouble with that assertion is that the
landlord is the freehold owner of the whole of this house and it is unencumbered.
So,
whatever in raising these by way of loan.
Third, it was
said that Mrs Binfield had had nothing to do with the catering trade for a
great many years. Some 30 years ago she lent a hand in the cafe which was being
operated in these premises at that time.
But there it
is. The judge had all that in mind, and he had this to say about it:
I have to say
that the business side of the plan is at a very early stage in terms of
thinking seriously of the finance and conduct of the plan. I accept Mr
Marshall’s point that it is entirely possible that finances and borrowing
capacity will be difficult, and that Mrs Binfield’s experience is insufficient,
and that their ability, by reason of their age and partial infirmity to handle
the younger element of the clientele would be a problem. If I look at all these
things, I am driven to the conclusion that there are very great uncertainties
in the way of the landlord, and so if I were asked to determine the question of
their chances of success, I would find that they are less than their chances of
failure. Mr Marshall says that there must come a point where the intention
cannot be described as genuine on the evidence, because it is too unrealistic
or far fetched for reliance to be placed on it. The inference being that it is
so ill considered that it cannot really be relied on in support of the
landlord’s opposition. I think Mr Marshall is right about that, but I do not,
and cannot find that this point has been reached in this case. I accept that
Mrs Binfield has a very powerful wish to stay in the premises, and I believe
that her approach to this matter starts from this point.
I should point
out that she had been in the premises since 1951. The judge continued:
I return to
the two points — the downstairs room for Mr Binfield and additional income. It
could be argued (and if I had to, I would find) that if I were the landlord’s
financial adviser, I would advise they should keep on the present tenant.
But he took
all that into account and he said:
But Mrs
Binfield needs the downstairs accommodation, and it is evident, despite close
cross-examination about the bathroom being upstairs, and the fact that the
downstairs lavatory is outside, that all Mr Binfield would have to do is to
climb the stairs for a bath. I am sure that he could manage that for some time.
He weighed all
these matters up, he had them clearly in mind, and then he said:
Although I
think that the plans are ill thought out and likely to fail, I cannot say that
they are so unrealistic that they are not genuine. I am reinforced in this by
Mrs Binfield’s attachment to the premises. Accordingly, I find myself driven by
the law to conclude that the tenant’s application must fail.
This is a
judgment which, it seems to me, considers the law completely correctly; it
carefuly balances and weighs the facts which the learned judge found, and it is
really quite impossible for this court to set it aside. The learned judge has
taken all these matters into account, and, once he accepted Mrs Binfield’s
evidence that she was strongly motivated with a desire to stay in the house, we
cannot possibly say that he was wrong about that. The mere fact that at that
stage of the hearing there had been no approach to a bank or a building society
to raise money, that there had been no investigation as to what the actual cost
of setting up a small cafe would be (she said in evidence that it might be
£5,000 or £10,000 but she had not priced it in any way) does not change the
position. These are matters which the judge considered, and of themselves they
do not, in my judgment, require a finding that objectively the intention does
not satisfy the Act. I think the judge was entitled to come to the conclusion
that he did. Although, like the judge, I have great sympathy with the tenant,
who has put in a lot of hard work to make a living out of the cafe, I can find
no ground for setting this judgment aside.
I would
dismiss the appeal.
SIR ROGER
ORMROD agreed and did not add anything.
The appeal
was dismissed with costs.
