Lease – Excluded tenancy – Adjoining land — Respondent holding long lease of house and grounds in designated rural area – Respondent serving notice claiming right to acquire freehold – Appellant landlords challenging right to enfranchisement – Whether respondent having excluded tenancy with no right to enfranchise – Section 1AA(3)(b) of the Leasehold Reform Act 1967 — Appeal allowed
The appellants were the freeholders of land (Shenley Park) that comprised a house and around 1.4 acres of land that were bounded by the remainder of the park. The respondent held a long lease of the house and grounds.
By the Housing (Right to Acquire and Enfranchise)(Designated Rural Areas in the East) Order 1997 (SI 1997/623) (which came into force in April 1997), made pursuant to powers conferred by section 17 of the Housing Act 1996 and section 1AA(3)(a) of the Leasehold Reform Act 1967, the secretary of state for the environment designated areas, including Shenley Park, as “rural areas”.
In September 2006, the respondent served a notice, under the 1967 Act, of her wish to acquire the freehold of the house and grounds. By their reply notice, the appellants asserted that she was not entitled to acquire the freehold since her tenancy was an “excluded tenancy” within the meaning of section 1AA(3) of the 1967 Act.
It was common ground that, for the purposes of section 1AA(3), the respondent’s house was within a designated rural area and that, since 1997, the appellants had owned the freehold of her “house” and of other land in the rural areas that touched and lay beyond the boundaries of her “house and premises”. Both her “house” (that is, the building) and the “premises” let with it (that is, her garden) were occupied for residential purposes. The rural area that touched and lay beyond its boundaries was not so occupied. The critical question was whether such rural area was ”adjoining land” within the meaning of section 1AA(3)(b).
The county court judge accepted the respondent’s argument that the section 1AA(3) reference to “house” was to only the building, as defined by section 2(1) of the 1967; and that “adjoining” meant touching rather than neighbouring. Accordingly, he accepted that the appellants’ rural land did not adjoin the respondents’ house so that the tenancy of her house was not an excluded tenancy. The appellants appealed.
Held: The appeal was allowed.
Since the word “house” had a defined meaning in sections 1(1) and 1AA(1) of the 1967 Act in contradistinction to “house and premises”, it could not be concluded that its use was a mistake. Instead, the resolution of the interpretative problem lay in the word “adjoining”.
The issue for the courts was the meaning of “adjoining” in the particular context in which it was used. Although “adjoining” would commonly be use in the sense of touching, it could mean “neighbouring”. It could not be presumed that parliament had used the words “adjoining land” as intending to convey only one of the meanings of “adjoining”. The exercise of interpretation required the words to be interpreted in the context in which they had been used: Cave v Horsell [1912] 3 KB 533 and Cobstone Investments Ltd v Maxim [1985] QB 140 considered.
In the instant case, the words “adjoining land” had to be interpreted in relation to the word “house”, which meant the building alone. The interpretation of “adjoining land” as meaning land that touched the house would lead to anomalies and absurdities that parliament could not have intended. Section 1AA(3) admitted of an interpretation that would avoid such absurdities, by reading “adjoining land” as “neighbouring land”. That was both a legitimate and a correct interpretation.
The word “house” in section 1AA(3) meant “house” as defined by section 2(1) and “adjoining land” in section 1AA(3)(b) meant neighbouring land that either might or might not touch, or adjoin, the house. Accordingly, the respondent had an excluded tenancy within section 1AA(3) and was not entitled to acquire the freehold of her house and premises.
Joanne Wicks QC (instructed by the legal department of Hertsmere Borough Council) appeared for the appellants; Anthony Radevsky (instructed by Pemberton Greenish LLP) appeared for the respondent.
Eileen O’Grady, barrister
