Landlord and tenant — Service charge in lease of flat — Appellant, tenant of a flat in a block, was liable under her lease to pay to the lessors a contribution equal to 2.9% of ‘the lessors’ annual expenditure on the maintenance of the block, the contribution for the year in question being £737.55 — The respondents had been granted a concurrent lease of the appellant’s flat and thus became her immediate reversioners — Lessors of the block demanded from the respondents the above sum of £737.55, which they paid — When the respondents required recovery of this sum from the appellant she contended that the respondents were her ‘lessors’ and, as they had expended only £737.55, her liability to contribute was confined to 2.9% of £737.55 — Held, affirming the decision in the county court, but on different grounds, that the appellant was liable to pay the full sum of £737.55 — Although the expression ‘the lessors’ was defined in the lease of the flat to include the immediate reversioners it did not, on a true construction, exclude the head landlords — The respondents as the immediate reversioners were entitled to sue for the contribution, but the measure of it was 2.9% of the head landlords’ expenditure — Appeal dismissed
This was an
appeal by Mrs Adrienne Christie, tenant of flat 5 in Linton House, Holland Park
Avenue, London W11, from a decision of Mr Assistant Recorder Caldwell at West
London County Court in favour of Adelphi (Estates) Ltd, the plaintiffs in the
county court action and present respondents.
Kim Lewison
(instructed by Redstone Nathan) appeared on behalf of the appellant; B Levy
(instructed by Lieberman Leigh & Co) represented the respondents.
Giving the
first judgment at the invitation of Eveleigh LJ, SIR DAVID CAIRNS said: This is
an appeal from a decision of Mr Assistant Recorder Caldwell in the West London
County Court about a service contribution payable under the lease of a flat. He
gave judgment for the plaintiff, Adelphi (Estates) Ltd (to whom I shall refer
as ‘Adelphi’), holding that the defendant, Mrs Adrienne Christie, was liable to
pay the contribution of £737.55. Mrs Christie appeals.
The lease was
dated July 24 1968, was made between a company called Josun Ltd (‘Josun’) and
Mrs Christie, and was a lease for 125 years of flat no 5 in a block of flats
called Linton House in Holland Park Avenue, London W11. The lease contained a
covenant by the lessee to pay each year to the lessors a contribution of 2.9%
of the amount spent by the lessors during the year on maintaining the block of
flats.
On July 15
1975 Pimel (Paddington) Ltd (‘Pimel’) acquired Josun’s interest in Linton
House. On December 5 1980, Pimel granted to Adelphi a concurrent lease of flat
5.
The
contribution which was the subject of Adelphi’s claim was for the year ended
March 31 1981. The sum of £737.55 was 2.9% of Pimel’s expenditure for that year
on maintaining the whole block of flats. Pimel had claimed this sum from
Adelphi and Adelphi had paid it. The issues in the action and on the appeal
were whether, on the true construction of the lease, Mrs Christie was liable to
Adelphi for any contribution and, if liable at all, whether for £737.55 or for
only 2.9% of that sum.
In order to
understand how those issues arose it is necessary to consider the terms of the
lease in relation to the contribution and, in order to resolve the issues, it
is helpful to examine some of the other terms which have no direct bearing on
the contribution.
The opening
words of the lease declare it to be made between Josun ‘hereinafter called ‘the
Lessors” and Mrs Christie. In clause 1(a) it is provided: ”The Lessors’ shall
include the person or persons for the time being entitled to the reversion
immediately expectant on the determination of the term hereby created.’ By clause 1(c) and the First Schedule, ‘the
Property’ is defined to mean Linton House. By clause 1(1) and schedule 8,
‘Contribution’ is defined to mean:
A yearly sum
equal to 2.9 per centum of the amount which the Lessors shall from time to time
have expended during the year immediately preceding the date hereunder
mentioned in (a) meeting the outgoing costs expenses and liabilities incurred
by them in carrying out their obligations under the provisions of the Seventh
Schedule hereto (except paragraphs 6 and 7 thereof) and (b) in paying from time
to time the costs and expenses of and incidental to making repairing
maintaining amending and cleansing all or any ways roads pavements gutters
sewers channels drains pipes wires cables watercourses walls party walls party
structure fences and works and other apparatus matters and conveniences which
shall belong to or be used for the premises in common with any other part or
parts of the property or any neighbouring or adjoining premises or which shall
form part of the reserved property such contribution to be payable on the first
day of April in every year. The amount of such contribution shall be
ascertained and certified by the Lessors’ Managing Agents acting as experts and
not as arbitrators and each year throughout the term on the first day of April in
each year (or if such ascertainment shall not take place on the said 1st day of
April then the said amount shall be ascertained as soon thereafter as may be
possible as though such amount had been ascertained on the aforesaid first day
of April) commencing on the first day of April one thousand nine hundred and
sixty-seven and such Certificate shall contain a fair summary of the Lessors
expenses and a copy thereof shall be supplied to the Lessee.
By clause 3 of
the lease and clause 1 of schedule 6 the lessee covenanted to pay to the
lessors, inter alia, the contribution.
A certificate
within the meaning of the definition of the contribution was made by Pimel’s
agents for the year ended March 31 1981 and showed that the total expenditure
on the maintenance of Linton House during that year was £25,432.89, and that
the proportion attributable to flat 5, ie 2.9% of that total, was £737.55.
The contention
for Mrs Christie was as follows: ‘The Lessors’ means Josun and the person for
the time being entitled to the reversion immediately expectant on the
determination of the lease. From July 5 1980 Pimel was no longer so expectant
but Adelphi was. The certificate was not a certificate of Adelphi’s expenditure
but of Pimel’s and was made not by Adelphi’s agents but by Pimel’s. The only
expenditure by Adelphi was £737.55 and that was never certified. If it had
been, then Mrs Christie’s contribution would have been only 2.9% of £737.55.
The Assistant
Recorder held that in the events which had happened ‘the Lessor’ in the lease
was wide enough to include Pimel. The only specific reason he gave for so
holding was that he derived some assistance from the Housing Act 1980. It was
not contended by Mr Levy on behalf of Adelphi in this court that any such
assistance in the construction of the lease could be obtained. Clearly it could
not — not only because the Act of 1980 was not in force when the lease was
entered into, but because a statutory definition is relevant only for the
purpose of construing the statute itself.
Mr Levy’s
submissions were based on the proposition that on the true construction of the
lease the words ‘the Lessors’ were apt to include, in many of the provisions of
the lease, a head landlord, when there was a mesne landlord who was entitled to
the immediate reversion but whose interest was confined to only one flat.
It is
important to remember that the lease does not define the expression ‘the
Lessors’. It applies that description to Josun and then extends it to include
the immediate reversioner, but leaves it open to include also any other person
who, on a reasonable construction of any particular term of the lease, can be
considered to have been intended to be regarded as ‘the Lessors’ for the
purpose of that term.
As Mr Levy
pointed out, there are a number of provisions of the lease which would be apt
to signify a head landlord whose interest was in the whole of Linton House but
quite inappropriate in relation to a person such as Adelphi whose interest was
only in a single flat. Thus in schedule 6, clause 7(a), there is a covenant by
the lessee to allow the lessors and persons authorised by them to enter the
flat for the purpose of repairing other parts of Linton House. In schedule 7
there is a whole series of covenants by the lessors to keep the reserved property
(ie the parts not included in any flat) in good order, to insure the whole
block of flats against fire etc.
Mr Lewison for
Mrs Christie frankly admitted that if his contentions were to succeed, Mrs
Christie would have been fortuitously relieved of the burden of an expenditure
which she fully expected, when the lease was granted, to have to bear as long
as she lived and held the flat under the lease. That does not mean that she is
not entitled to take advantage of the exact terms of the lease if, in the
events which have happened, those terms no longer place that burden upon her.
But in my judgment the reasonable construction of the lease’s definition of
‘the Contribution’ is that when it refers to ‘the Lessors’ it includes a person
standing in Josun’s shoes and being responsible for the maintenance of Linton
House as a whole. Accordingly I would hold that, while it is Adelphi who as the
immediate reversioners are entitled to sue for the contribution, the measure of
the contribution is 2.9% of Pimel’s expenditure, and it was the certificate of
Pimel’s agents which made the contribution payable.
I would
therefore dismiss the appeal.
Agreeing,
EVELEIGH LJ said: While the lease says that ”The Lessors’ shall include the
person or persons for the time being entitled to the reversion immediately
expectant on the determination of the term hereby created’, it does not say
that the title shall apply to no one else. In some clauses in the lease the
word ‘lessors’ is quite inappropriate to cover a person entitled to the
reversion of a single flat as opposed to one entitled to the reversion of the
whole block, as Sir David Cairns has said.
In Lloyd
v Lloyd (1837) 2 My and Cr 192 at p 202 Lord Cottenham said:
If the
provisions are clearly expressed, and there is nothing to enable the court to
put upon them a construction different from that which the words import, no
doubt the words must prevail; but if the provisions and expressions be contradictory
and if there be grounds, appearing upon the face of the instrument, affording
proof of the real intention of the parties, then that intention will prevail
against the obvious and ordinary meaning of the words. If the parties have
themselves furnished a key to the meaning of the words used, it is not material
by what expression they convey their intention.
The whole plan
of management and the scheme for raising the money to pay for it as set out in
the lease clearly indicates that the intention of the parties is that the
tenant shall pay 2.9% of the cost of running the whole building. There is
nothing in the words used and in particular the use of the words ‘the Lessors’
to prevent the court from giving effect to this intention.
The appeal
was dismissed with costs.