Business tenancy — Application for new lease — Premises used for gaming club — Tenant transferred gaming licence to different premises — Instant premises unoccupied at relevant time — Tenant intending to reoccupy — Whether premises occupied by tenant for purposes of business — Whether tenant eligible for new tenancy
The plaintiff company is the assignee of a 33-year lease granted in 1953 of premises at 1 Hans Street, London SW1. The plaintiffs used the premises until 1984 as a gaming club for which they had a gaming licence. When the plaintiffs opened a new club in 1984 in Curzon Street, they surrendered their Hans Street gaming licence in return for a licence for the new club. The premises at Hans Street have since been unoccupied.
At the expiry of the original lease, the plaintiffs applied to the court for the grant of a new lease under the provisions of Part II of the Landlord and Tenant Act 1954. The defendant landlord contended that the plaintiffs should not be granted a new lease, on the ground that the premises have been unoccupied for over four years; section 23 of the 1954 Act provides that a tenancy is within the protection of the Act if the premises are “occupied by the tenant and are so occupied for the purposes of a business”. It was the plaintiffs’ intention to occupy the premises, but the gaming board had refused to consider the application for a new gaming licence until a new lease was granted.
Held The plaintiffs did not satisfy the requirements of section 23 of the Landlord and Tenant Act 1954 as to occupation for business purposes; their application for a new lease was dismissed. Although the premises were not occupied for business purposes in July 1986 when the plaintiffs first applied for a tenancy, that was not conclusive. The question was whether the thread of continuity of a business user had been broken.
The plaintiffs had not occupied the premises for business purposes since 1984 and, although they had an intention to reoccupy on the grant of a gaming licence, the evidence showed that the thread of continuity was broken. An intention to occupy is not sufficient: see the test posed by Scarman LJ (as he then was) in Morrisons Holdings Ltd v Manders Property (Wolverhampton) Ltd [1976] 1 WLR 533 at p 540A where he said that “if events over which he has no control have led him to absent himself from the premises…” the tenant must continue to exert and claim his right to occupancy. In the present case the tenants had a choice in 1984; they chose to surrender the gaming licence and leave the premises.
Hancock & Willis v G M S Syndicate Ltd
(1983) 265 EG 473; [1983] EGD 114 considered.
David Neuberger QC (instructed by Herbert Smith) appeared for the plaintiffs; and Anthony Radevsky (instructed by Lee & Pembertons) appeared for the defendant.
