Landlord and tenant –– Housing Act 1988 –– Assured tenancy –– Houseboat –– Whether letting of houseboat an assured tenancy –– Whether houseboat annexed to land –– Whether a letting of land
The appellant company held an annual licence from the Port of London Authority, authorising it to grant mooring licences and charge fees for mooring on the north bank of the River Thames, Battersea. The company was the owner of a houseboat moored, with others, alongside pontoons upon which the company provided services. The houseboat was formed by conversion works that included the removal of the engine and the creation of permanent living accommodation. It floated on each tide for about six hours, and took the ground at half tide. By an agreement dated 31 August 1993, Mrs C, the previous owner, let the houseboat and its contents to the respondent tenant for a term of six months at an annual rent payable monthly. The agreement was in a form largely appropriate for the letting of a dwelling-house. The agreement was extended until 1996, when the company purchased the houseboat. The company first extended the agreement until April 1997, but then sought possession for failure to pay rent. It was held in the county court that the letting of the houseboat was an assured tenancy within Part I of the Housing Act 1988, being “a tenancy under which a dwelling-house is let”. The company appealed contending that the houseboat was a chattel, and incapable of being the subject of a tenancy, and that the houseboat was not “a dwelling-house”.
Held: The appeal was allowed. The agreement was not an assured tenancy under Part I of the Housing Act 1988. The houseboat had not become part of the land; Elitestone Ltd v Morris [1997] 2 EGLR 115 applied; there was an insufficient degree of annexation of the houseboat to the land as it could easily be moved, and the object or purpose of the annexation by moorings was primarily to prevent the houseboat from being carried away and to provide services to it. The terms of the agreement did not have any relevance to whether there had been the requisite degree or purpose of annexation.
The following cases are referred to in this report.
Cory v Bristow (1877) 2 App Cas 262, HL
Elitestone Ltd v Morris [1997] 1 WLR 687; [1997] 1 All ER 513; [1997] 2 EGLR 115; [1997] 27 EG 116
Forrest v Greenwich Overseers (1858) 8 E&B 890
Holland v Hodgson (1872) LR 7 CP 328; [1861-73] All ER Rep 237
Leigh v Taylor [1902] AC 157; 18 TLR 293, HL
Makins v Elson [1977] 1 WLR 221; [1977] 1 All ER 572
R v Rent Officer of Nottingham Registration Area, ex parte Allen (1986) 52 P&CR 41; [1985] 2 EGLR 153; (1985) 275 EG 251;17 HLR 481
Stubbs v Hartnell (1997) 74 P&CR D36
Westminster City Council v Woodbury (VO) [1991] 2 EGLR 173; [1991] 48 EG 129
This was an appeal by the claimant, Chelsea Yacht & Boat Co Ltd, from a decision of Judge Cotran, sitting in West London County Court, dismissing an appeal by the claimant from a decision of the district judge in possession proceedings against the defendant, Justin Pope.
John Male (instructed by Winward Fearon) appeared for the appellant; Valerie Easty (instructed by Gold Lerman & Muirhead) represented the respondent.
Giving judgment, Tuckey LJ said: Is the letting of a houseboat the tenancy of a dwelling-house for the purpose of Part I of the Housing Act 1988?
This question arises on appeal from Judge Cotran in West London County Court, who decided that the agreement under which the respondent, Mr Pope, occupies a houseboat on the Thames was such a tenancy.
The appellant, Chelsea Yacht & Boat Co Ltd, now owns the houseboat. It also runs the boatyard and owns the moorings where it is moored on the north side of the river, upstream of Battersea Bridge, in London. The boatyard has various facilities for houseboats on the embankment and on floating barges.
The bed of the river is owned by the Port of London Authority, which, for an annual licence fee, permits the appellant to maintain, among other things, mooring piles, mooring pontoons and gangways to accommodate residential craft in the river. The licence authorises it to grant mooring licences and charge fees for the use of the moorings. The mooring pontoons rise and fall with the tide and run in a line parallel with the embankment wall in Cheyne Walk. The houseboats are moored in a line either side of, and stern or bow to, the pontoons. They lie across the stream, held by anchors. On the pontoons, the appellant provides services for the houseboats in the shape of water, gas, electricity, telephone and vacuum drainage. These services are easily connected to the houseboats by plug-in or snap-on connections.
The “Dinty Moore” occupied by Mr Pope is a converted wooden D-Day landing craft, fitted inside a steel Thames barge built by the appellant in about 1967. It is 46ft long and 11ft wide, and is moored stern to the pontoon, and to the adjoining houseboats, by a number of rope mooring lines. Lines from the bow go to an anchor in the river bed at the foot of the embankment wall and to rings in the wall itself. It is connected to the services provided by the appellant. The houseboat takes the ground at about half tide. In other words, it is afloat for about six hours or so and then aground for the following six hours. The conversion involved removal of the engine and the creation of permanent living accommodation below, the layout and detail of which do not matter.
In 1993 the houseboat was owned by Mrs Crafter and was moored in the position I have described (mooring 21) under the terms of a mooring licence from the appellant. Mrs Crafter let it and its contents to Mr Pope on the terms of a written agreement dated 31 August 1993 (the agreement). The agreement is in a form largely appropriate for the
A houseboat is a chattel, and although the hiring of a chattel cannot strictly be termed a leasing, an agreement for the hiring of a houseboat which will remain at the same mooring place may well follow the general form of an agreement for the tenancy of real property.
The agreement describes the parties as landlord and tenant and the houseboat as a single-storey vessel. The letting was for a term of six months from 1 September 1993 at an annual rent of £3,380 payable monthly. Mr Pope agreed to carry out certain repairs to the houseboat straight away, including painting its hull, and to keep it and the mooring in good and tenantable repair. He was not to allow it to obstruct the waterway or use it other than as a single private dwelling. It was not to be removed from the mooring without Mrs Crafter’s permission, other than to enable Mr Pope to comply with his obligations under the agreement.
Mr Pope has made his home in the houseboat since 1993. The agreement was extended at six-monthly intervals by Mrs Crafter until about 1996, when the appellant bought the houseboat from her. It extended the agreement until 30 April 1997, but then sought possession for failure to pay the rent and other breaches of the agreement. Proceedings were started in March 1998, and the question that gives rise to this appeal, “was the agreement governed by the Housing Act 1988?”, was decided as a preliminary issue. Both the district judge and Judge Cotran, as I have said, decided that it was.
So far as is relevant to this case, the Housing Act 1988 applies to: “A tenancy under which a dwelling-house is let”. The appellant contended, first, that the houseboat is a chattel and so is incapable of being the subject of a tenancy, and, second, that, in any event, a houseboat is not a dwelling-house.
It is not clear from the judge’s judgment whether he appreciated that these were separate points. He appears to have accepted that the houseboat had become part of the land by annexation. He did not think such a conclusion would create difficulties, saying:
The houseboat has been there for many years. It was bought by the plaintiff. It can be sold to somebody else. I do not see any problem relating to the ownership of the land on which it lies.
At the end of his judgment, he said, correctly, that there was no decided case dealing with a houseboat and added:
It makes not the slightest difference, as far as I am concerned, whether a houseboat lies on the land after removal from water or is attached to the river bed and/or float for part of the day, so long as it is permanently immobile and let as such.
On the second point he appears to have agreed with the district judge, who said:
I can see no reason why, in circumstances such as these, a houseboat cannot be both a dwelling-house and a boat. That is, after all, what the word “houseboat” implies.
On this appeal we have only heard argument on the first point, since it is accepted on behalf of Mr Pope that if the appellant is right on this point, the appeal must succeed.
It is common ground that the Housing Act 1988 only applies to the letting of land and that the houseboat is a chattel unless it has become part of the land by annexation.
The principles by which to test whether a chattel has become part of the land have recently been considered by the House of Lords in Elitestone Ltd v Morris [1997] 1 WLR 687*. In that case, the question was whether a chalet, resting only by its own weight on concrete pillars set into the ground, had become part of the land. The chalet was connected to the usual services. It could not be taken down and re-erected elsewhere; it could only be removed by demolition. The house restored the assistant recorder’s conclusion that it was part of the land. The headnote says:
the answer to the question whether a structure became part and parcel of the land itself depended on the degree and the object of annexation to the land; that, assessed objectively, a house built in such a way that it could not be removed except by destruction could not have been intended to remain a chattel and must have been intended to form part of the realty.
* Editor’s note: Also reported at [1997] 2 EGLR 115
Various passages in the speeches in this case are relied on by both sides. However, the broad questions that the court has to consider are accurately summarised in the headnote.
In considering the degree of annexation, it is obviously of importance that the chattel can be removed without injury to itself or to the land. There must also be a degree of permanence. Purpose is also important, as the illustration given by Blackburn J in Holland v Hodgson (1872) LR 7 CP 328 at p335, cited with approval in Elitestone at p698A, shows. He said:
blocks of stone placed one on the top of another without any mortar or cement for the purpose of forming a dry stone wall would become part of the land, though the same stones, if deposited in a builder’s yard and for convenience sake stacked on the top of each other in the form of a wall, would remain chattels. On the other hand, an article may be very firmly fixed to the land, and yet the circumstances may be such as to show that it was never intended to be part of the land, and then it does not become part of the land. The anchor of a large ship must be very firmly fixed in the ground in order to bear the strain of the cable, yet no one could suppose that it became part of the land, even though it should chance that the shipowner was also the owner of the fee simple at the spot where the anchor was dropped. An anchor similarly fixed in the soil for the purpose of bearing the strain of the chain of a suspension bridge would be part of the land.
Miss Valerie Easty, in her clear and spirited submissions to us on behalf of Mr Pope, referred to a number of other cases under different legislation. First, she referred to rating cases where the court had to consider whether the occupiers of a hulk (Cory v Bristow (1877) 2 App Cas 262), a landing stage (Forrest v Greenwich Overseers (1858) 8 E&B 890) and the Hispaniola (Westminster City Council v Woodbury (VO) [1991] 2 EGLR 173), all in the Thames, were in rateable occupation of land. But these cases only illustrate the circumstances in which, under the intricacies of rating law, a chattel becomes rateable if it occupies land or is enjoyed with land. They shed no light on the circumstances in which a chattel becomes part of the land, and, therefore, I do not find them of assistance in this case. The same applies to the poll tax case of Stubbs v Hartnell (1997) 74 P&CR D36, which concerned a houseboat in the Thames.
Miss Easty also referred us to Makins v Elson [1977] 1 WLR 221, where the court had to consider whether the taxpayer was liable to capital gains tax, upon the disposal of his mobile caravan, under the terms of section 29 of the Finance Act 1965. That Act distinguished between a dwelling-house and land. The question of whether the caravan became part of the land did not, therefore, arise, and, again, I do not think that this decision helps to resolve the instant case.
Finally, Miss Easty relied on the decision of Farquharson J in R v Rent Officer of Nottingham Registration Area, ex parte Allen [1985] 2 EGLR 153, who quashed the decision of a rent officer who had registered a fair rent for a caravan on the basis that its letting fell within the Rent Act. In the course of his judgment, Farquharson J said it was not possible to say that, just because the subject-matter of the letting was a caravan, it would not fall within the Rent Act. However, it is clear from the judgment that the only point the judge considered was whether the caravan was a house. That is the second point in this case, upon which we have not heard argument. I do not think the decision casts any real light on the first point that we have to decide.
Elitestone is binding upon us and we have to apply the principles laid down in that case. How should they be applied to the facts of this case?
Miss Easty first argued that both the district judge and the judge had found the facts against the appellant in a way that did not enable this court to interfere.
I do not accept this submission. The district judge decided the case on the basis that Elitestone was of no assistance. He does not appear to have addressed the question of whether the houseboat became part of the land at all. As I have already said, it is not clear whether the judge really did so either. If he did, he appears to have based his decision on the fact that the houseboat was: “Permanently immobile and let as such”. But it was not permanently immobile, and it is common ground that the terms of the agreement could not, of themselves, have created the necessary annexation. For these reasons, I do not think we are in any way bound by the findings below.
Turning first to the degree of annexation, it is important to bear in mind that what is required is sufficient attachment to the land so that the chattel becomes part of the land itself. Here, the houseboat rested periodically on the river bed below it and was secured by ropes, and perhaps, to an extent, the services to other structures. It is difficult to see how attachments in this way to the pontoons, the anchor in the river bed and the rings in the embankment wall, could possibly make the houseboat part of the land. One is bound to ask: “Which land?” There is, in my judgment, no satisfactory answer to this question. More importantly, however, all these attachments could simply be undone. The houseboat could be moved quite easily without injury to itself or the land. The agreement contemplated that it would be moved, and, in practical terms, required Mr Pope to dry-dock it if he were to fulfil his obligation to paint the hull. The fact that it could not move under its own power is not the point. While the houseboat was obviously intended to be moored where it was for the term of the agreement at least, the fact that it could, and would, have to be moved greatly undermines the argument based on permanence.
Turning, then, to the object or purpose of annexation, Miss Easty strongly submits that the attachment of the houseboat was to provide a permanent home for its occupant. I do not agree. It is not necessary to annex the houseboat to the land to enable it to be used as a home. The attachments were, like the ship’s anchor referred to by Blackburn J, to prevent the houseboat from being carried by the tide or the weather up or downstream and to provide the services to it.
For these reasons, I conclude that the houseboat has not become part of the land. I support this conclusion on the grounds of common sense. It is common sense that a house built on land is part of the land: see Lord Lloyd in Elitestone at p692H. So, too, it is common sense that a boat on a river is not part of the land. A boat, albeit one used as a home, is not of the same genus as real property.
For these reasons, I would allow this appeal and answer no to the question: “Was the agreement governed by the Housing Act 1988?”.
Agreeing, Morritt LJ said: The circumstances in which this appeal arises have been fully described by Tuckey LJ. I gratefully adopt his account of them. It is common ground that the Housing Act 1988 applies to leases or tenancies of land, but not of equivalent agreements in relation to chattels. It is equally plain that, originally, both the landing craft and the barge in which it now rests were chattels. It seems to me, therefore, that there are two questions only: (1) has the combined barge/landing craft become part of the land?; and (2) if it has, is it a dwelling-house?
We heard argument on the first point only. Accordingly, the views I express are directed to that point alone, even if some of them might be capable of being addressed to both of them.
We are, of course, bound by the decision of the House of Lords in Elitestone Ltd v Morris [1997] 1 WLR 687. In that case, the House of Lords pointed out that the question was whether the chattel had become part and parcel of the land, not whether it was a fixture: see p691G-H. The House of Lords also approved the test formulated by Blackburn J in Holland v Hodgson (1872) LR 7 CP 328 that the answer to the question depends upon two factors; the degree and object of annexation. Lord Lloyd of Berwick pointed out that the intention of the parties was only relevant to the extent to which it could be derived from the degree and object of annexation. Illustrative of those principles, in relation to a tapestry, is the decision in Leigh v Taylor [1902] AC 157, to which we were referred.
In addition to these three cases, we were referred to a number of other cases by way of illustration. I commend Miss Easty for her diligence, but I find them of no assistance.
The three rating cases, Cory v Bristow (1877) 2 App Cas 262, Forrest v Greenwich Overseers (1858) 8 E&B 890 and Westminster City Council v Woodbury (VO) [1991] 2 EGLR 173 were all concerned with whether there was rateable occupation of the river bed by means of a derrick hulk, a vessel permanently moored and the landing stage. In none of them was the court concerned with the question of whether the chattel in question had itself become a part of the land.
In Makins vElson [1977] 1 WLR 221, the court was concerned with the exemption from capital gains tax, afforded to the taxpayer’s residence by section 29 of the relevant Finance Act. The definition of residence for present purposes was:
(a) a dwelling house or part of a dwelling house which is, or has at any time in his period of ownership been, his only or main residence, or (b) land which he has for his own occupation and enjoyment with that residence as its garden or grounds…
Foster J held that the taxpayer’s caravan was within para (a) of that definition. It formed no part of his conclusion that, in the circumstances of the case, the caravan that he had described had become a part of the land itself. In Stubbs v Hartnell (1997) 74 P&CR D36, the court was concerned with liability to council tax in relation to a houseboat. But liability did not depend upon whether the houseboat was part of the land or not. Accordingly, it is of no direct relevance to the question before us. In R v Rent Officer of Nottingham, ex parte Allen [1985] 2 EGLR 153, the question was whether a fully mobile caravan was a house for the purposes of the Rent Act 1977. The question of whether it was part of the land was not argued. To the like effect, there is a decision in respect of a houseboat called the “Lady Betty” noted in (1949) 113 JPR 376. The question was whether it was a house, within the meaning of the Furnished Houses Rent Control Act 1946, not whether it was part of the land.
In agreeing with the district judge, Judge Cotran said:
The factors necessary to decide the preliminary issue were: (a) the terms of tenancy-use and removability; (b) the degree of permanence and movability/immovability; and (c) the nature of the structure and its use. He…
that is, the district judge:
said that on the facts as he found them, and on the three factors of importance, the “Dinty Moore”, was held on an asssured tenancy within the meaning of the Housing Act 1988. It seems to me that to argue that no houseboat can ever be protected is wrong. Certainly it is wrong if one considers the criteria that the case law has put forward. There has been no decision on a houseboat as such but there has been, in relation to a caravan and its mobility/immobility, and it makes not the slightest difference, as far as I am concerned, whether a houseboat lies on the land after removal from water or is attached to the river bed and/or float for part of the day, so long as it is permanently immobile and let as such.
In my view, there are a number of criticisms that may be made of that passage. First, the terms of the tenancy do not appear to me to have any relevance to whether there has been the requisite degree or purpose of annexation. They show the intention of the parties in regard to the contract, but, as Lord Lloyd of Berwick pointed out in Elitestone Ltd v Morris at p693F, the intention of the parties is irrelevant, save in so far as it is derived from the degree and object of the annexation. Second, the judge considered that the only points of importance were whether the object was permanently immobile and let as such. On the first point, he was wrong as a matter of fact that the Dinty Moore could not be easily detached from its moorings and service connections and towed away by a barge. The second point was only relevant if the Housing Act applied, and that depended upon whether the Dinty Moore was part of the land; thus, reliance on the second point begged the question to be determined. Third, the judge did not seek to apply Elitestone Ltd v Morris, or, as was required by that decision, the twin factors of degree and object of annexation. Indeed, at p15B of the transcript of his judgment he said that that case did not assist the argument.
In the light of these criticisms, I reject the submission by counsel for Mr Pope that the issue was one of fact on which both judges below had reached clear conclusions with which this court should not interfere.
The proper test is that laid down in Holland v Hodgson as approved in Elitestone Ltd v Morris. The court has to consider both the degree and object of annexation. The Dinty Moore is attached to the river wall and the river in the manner described by Tuckey LJ; ultimately by ropes and service connections. Those ropes and services may be untied and disconnected without any undue effort, to enable the Dinty Moore to be towed away by a barge. Thus, the degree of annexation does not require recognition of the Dinty Moore as a part of the land.
Counsel for Mr Pope emphasises that the purpose of the annexation was to provide a home. Certainly, the object of the conversion of the landing craft, and its attachment to the services, was to provide a home. But there is nothing to prevent the removal of the Dinty Moore from this mooring to another. The provision of a home does not necessitate annexing the structure (be it a caravan or a boat) to the land so as to become a part of it; it is sufficient that it is fitted out for living in.
I agree with Tuckey LJ that the Dinty Moore cannot, in these and the other circumstances to which he refers, be regarded as a part of the land. In those circumstances, the second question, whether the Dinty Moore is a dwelling-house within the Housing Act 1988, does not arise.
I too would allow this appeal.
Waller LJ agreed and did not add anything.
Judgment on order for possession
After a short adjournment, Morritt LJ continued: The question arises, on the form of the order, as to whether we should make an order for possession in 28 days or whether we should remit the matter to the county court for the determination of the further issues alleged by counsel for Mr Pope still to be in play.
The position is that, following our judgment, Mr Pope has no security of tenure. The licence under which he formerly occupied was last extended to 31 August 1997. Accordingly, the term under which he last occupied expired at that date. The notice to quit, which, on our findings, was not strictly required, was served on 18 November 1997 and required Mr Pope to give up possession on 1 January 1998.
The proceedings were commenced on 20 March 1998 and the notice of appeal was served on 26 April 1999. It seems to me that the notice, the service of the proceedings and the service of the notice of appeal seeking an order for possession were more than sufficient to terminate any residual right of occupation that Mr Pope might have had. Even if it be assumed that he held over on terms requiring reasonable notice to be given, for my part I am satisfied that one, other or all three of those gave the requisite notice. Accordingly, for my part, I would make the order for possession within 28 days as sought.
Tuckey LJ and Waller LJ agreed and did not add anything.
Judgment on stay
Giving judgment on the issue of a stay, Morritt LJ said: We refuse a stay of execution of our order on the undertaking of the claimant that it will, forthwith, on receiving vacant possession of the boat, remit it for the necessary repairs, and, if it considers that the boat is beyond economic repair, then we give liberty to both parties to apply to the county court to determine what, if any, further relief would be sought. It is also on the undertaking that if the boat is capable of economic repair, if it is repaired, and if the House of Lords determines that we were wrong, that the claimant will let Mr Pope back into occupation of it.
Appeal allowed.
