Landlord and tenant — Possession — Landlord’s title — Proceedings for recovery of flat — Settled Land Act 1925 — Estoppel — Complications in apparently simple question — Appeal from decision of county court judge — Appeal dismissed, although for reasons different from those of the judge and with differences of approach in the Court of Appeal
which gave rise to the present appeal were as follows — A Mrs Davey was the
registered freehold owner of a house in Wandsworth — She shared the
ground-floor flat of the house with a friend, a Mrs Robinson — When Mrs Davey
died she left the whole house in trust for Mrs Robinson for life and thereafter
on trust for sale and to hold the proceeds of sale for named beneficiaries —
Mrs Robinson remained in occupation of the ground-floor flat until her death,
but she had, many years before, made an oral agreement for a weekly letting of
another flat in the house to the present appellant, a transaction which was to
give rise to problems in the future — Mrs Robinson died in 1986, having
appointed the present respondent, a sister, as executrix — Indications of later
trouble appeared when the respondent refused to accept rent tendered by the
appellant — A cause of confusion was introduced when chartered surveyors,
appointed by the trustees of the settlement to manage the property, issued a
new rent book to the appellant on which the landlord’s description and address
were stated to be ‘Exors Mrs E Davey, National Westminster Bank plc, c/o John G
Dean & Co, 189 Balham High Road’ — The appellant thereafter paid the rent
to the surveyors, John G Dean & Co, who accepted it — The respondent was
granted probate of the will of Mrs Robinson and as executrix she served a
notice on the appellant to quit the flat — It should be mentioned that the
legal title to the house was and remained vested in the respondent; the
trustees of the settlement never called on her to convey the legal title to
them — Proceedings for possession were commenced by the respondent against the
appellant
view was that Mrs Robinson had made a valid grant, although oral, of the
tenancy of the flat to the appellant and that on Mrs Robinson’s death the
reversion on the tenancy devolved on her executrix, the respondent — The
respondent then served a valid notice to quit on the appellant — The judge also
held that, as Mrs Robinson and the appellant were estopped from denying their
relationship of landlord and tenant, so after Mrs Robinson’s death the
respondent and the appellant were equally estopped
Court of Appeal that an elaborate argument invoking provisions of the Settled
Land Act 1925 was considered, an invocation which the judge had dismissed as
unhelpful — It was argued on behalf of the appellant that the oral tenancy
created by Mrs Robinson came to an end with her life interest — This made the
appellant’s continued occupation that of a trespasser, but, it was argued, her
status was legitimised when the trustees’ agents, by giving her a rent book and
accepting her rent, created a new tenancy in her favour — This tenancy had
never been terminated by a notice to quit from the trustees — The weaknesses of
this line of argument, as Stuart-Smith LJ pointed out, were that the legal
estate was not vested in the trustees; that the provisions of the Settled Land
Act 1925, which the appellant’s counsel had invoked in regard to the tenancy
created by Mrs Robinson, could equally be invoked against the trustees; and
that in the circumstances the creation of a contractual tenancy valid against
the respondent could not be established — The judge had reached the correct
conclusion, although by a different route
approach differed somewhat from that of Stuart-Smith LJ, although the end
result was the same — He asked why, if on Mrs Robinson’s death the appellant
became a trespasser, she did not continue to be a trespasser, against whom the
respondent was entitled to claim possession — The suggestion that she was
granted a new tenancy by the trustees had been firmly rejected by the judge,
whose finding in this respect could not be successfully challenged — It
followed that the respondent was entitled to possession without recourse to the
Settled Land Act 1925 — If, however, the reversion on the appellant’s tenancy
devolved on the respondent, the latter was entitled to bring the tenancy to an
end by notice to quit — Finally, if these simple solutions were wrong, and
recourse to the Settled Land Act provisions was necessary, McCowan LJ accepted
Stuart-Smith LJ’s analysis of why the appeal should fail in any event —
Observations by McCowan LJ about the discrepancy between the pleadings and the
case argued below
was that the appeal was dismissed, subject to the exception that an award
against the appellant of £1,330.83 by way of mesne profits was agreed to have
been made in error and to this extent the appeal was allowed
No cases are
referred to in this report.
This was an
appeal by Vivienne Johnston, defendant in possession proceedings in the
Wandsworth County Court, from the decision of Judge Hunter ordering possession
in favour of Eunice Bevan, executrix of the late Mrs Ann Gwenllian Robinson, of
the first-floor flat at 264 Trinity Road, Wandsworth, London SW18.
Miss Jane E
Belson (instructed by Leon Kaye & Collin) appeared on behalf of the appellant;
Gary N Webber (instructed by H C L Hanne & Co) represented the respondent.
Giving
judgment, STUART-SMITH LJ said: This is an appeal from a judgment of His
Honour Judge Hunter sitting at Wandsworth County Court and given on October 21
1988 whereby he ordered that the plaintiff should recover possession of the
first-floor flat at 264 Trinity Road, Wandsworth, from the defendant.
The defendant
now appeals from that order. The facts which were not in dispute are these.
Prior to her death Eileen Christine Davey
1972 Ann Gwenllian Robinson (Mrs Robinson) came to live at the house, sharing
the ground-floor flat with her friend Mrs Davey. On November 12 1974 Mrs Davey
died. By her will she left the house upon trust for Mrs Robinson for her life
and then upon trust for sale and as to the proceeds in trust for various named
beneficiaries in equal shares. The National Westminster Bank (the bank) and
Harold Arthur Bliss (the trustees) were appointed as her executors and
trustees. Mrs Robinson remained in occupation of the ground-floor flat until
her death. On September 1 1975 the appellant entered into possession of the
top-floor flat at 264 Trinity Road under an oral contract for a weekly tenancy
made with Mrs Robinson. During her lifetime Mrs Robinson collected and kept the
rent of the first-floor flat. On March 31 1978 Mrs Robinson was registered as
the freehold owner of the house.
On August 21
1986 Mrs Robinson died. By her will she had appointed the respondent, who is
her sister, as her executrix. Some time after this, the appellant tendered the
rent to the respondent. But she refused to accept it. In September 1986 John G
Dean & Co, chartered surveyors, were appointed by the bank to manage the
property. They issued a new rent book to the appellant. The landlord’s name and
address were stated to be Exors Mrs E Davey, National Westminster Bank plc c/o
John G Dean & Co, 189 Balham High Road. Thereafter the appellant paid rent
to John G Dean & Co, who accepted it.
On November 11
1986 probate was granted to the respondent as executrix of the will of Mrs
Robinson. On April 13 1987 notice to quit was served on the appellant by the
respondent and the proceedings were started on September 11 1987.
The
particulars of claim asserted in para 1 that the plaintiff/respondent was the
executrix of Mrs Robinson and as such was the freehold owner and entitled to
possession of the premises. The weekly tenancy was alleged and the termination
by notice to quit. In para 6 it was asserted that the appellant did not have
the protection of the Rent Act 1977 by virtue of the provisions of section 12
(the provisions are to sharing with a resident landlord), which, by virtue of
Schedule 2, para 2A, were available to a personal representative within two
years of the death of the landlord. It is accepted on behalf of the appellant
that she does not have the protection of the Rent Acts. The argument is that
the respondent has no title to sue and further that the weekly tenancy granted
by Mrs Robinson came to an end upon her death and that thereafter the trustees
granted a valid weekly tenancy which is binding upon the respondent. This
argument really finds no reflection in the defence. But it was the argument
advanced to the county court judge, although I am satisfied that it has been
considerably extended and elaborated before us. In any event Mr Webber takes no
point that the case was not covered by the pleadings.
Miss Belson’s
argument proceeds in two stages, and it is essential that she makes good both
of them. The first stage in the argument is that the oral contractual tenancy
granted to the appellant came to an end on Mrs Robinson’s death. The argument
is as follows. At all material times Mrs Robinson was the tenant for life,
having the powers granted by the Settled Land Act 1925. By section 42(1) it is
provided that:
Save as
hereinafter provided, every lease —
(i) shall be by deed . . .
Section 42(5):
A lease at the
best rent that can be reasonably obtained without fine, and whereby the lessee
is not exempted from punishment for waste, may be made —
(i) . . .
(ii) Where the term does not extend beyond three
years from the date of the writing, by any writing under hand only containing
an agreement instead of a covenant by the lessee for payment of rent.
The oral
tenancy agreement was not within the provisions of section 42. At the time the
tenancy agreement was made Mrs Robinson had not had the legal estate vested in
her. The effect of the disposition, therefore, was governed by section 13 of
the Settled Land Act 1925 as amended which provides:
Where a
tenant for life or statutory owner has become entitled to have a principal
vesting deed or a vesting assent executed in his favour, then until a vesting
instrument is executed or made pursuant to this Act in respect of the settled
land, any purported disposition thereof inter vivos by any person . . . shall
not take effect except in favour of a purchaser of a legal estate without
notice of such tenant for life or statutory owner having become so entitled as
aforesaid but, save as aforesaid, shall operate only as a contract for valuable
consideration to carry out the transaction after the requisite vesting instrument
has been executed or made, and a purchaser of a legal estate shall not be
concerned with such disposition unless the contract is registered as a land
charge.
At that stage,
therefore, submits Miss Belson, the appellant merely had a contract for valuable
consideration for a lease, which she could have called upon Mrs Robinson to
carry into effect after the legal estate vested in her. The legal estate was
vested in Mrs Robinson on March 31 1978 when she was registered as the freehold
owner. However, no written contract or other lease valid under section 42 was
ever executed.
The position
after the vesting assent is governed by section 18 of the Settled Land Act
1925. Section 18(1) provides:
Where land is
the subject of a vesting instrument and the trustees of the settlement have not
been discharged under this Act, then —
(a) any disposition by the tenant for life or
statutory owner of the land, other than a disposition authorised by this Act or
any other statute, or made in pursuance of any additional or larger powers
mentioned in the vesting instrument, shall be void, except for the purpose of
conveying or creating such equitable interests as he has power, in right of his
equitable interests and powers under the trust instrument, to convey or create;
. . .
The effect of
section 18(1), therefore, is that since the disposition was not authorised by
the Act it was void except for the purpose of conveying or creating such
equitable interest as Mrs Robinson had power to create in the right of her
equitable interest, which was limited to her own life. In other words, since
the tenancy agreement was not in writing it automatically came to an end upon
her death. Miss Belson does not shrink from accepting, therefore, that on the
death of Mrs Robinson the appellant became a trespasser, and had she sued at
that time the respondent would have been entitled to succeed. It is therefore
essential that Miss Belson establishes the second stage of her argument, since
otherwise, as she concedes, the respondent would be entitled to recover on the
simple ground that she was the legal owner of the freehold and the appellant
was a trespasser at the time the proceedings were brought.
Stage two of
the argument is this. At all material times after Mrs Robinson’s death, the
trustees were entitled to have conveyed to them by the respondent the legal
estate in the land (Settled Land Act 1925, section 36). By their agents’ action
in issuing a rent book, describing the bank as landlord and accepting rent, the
trustees created a new tenancy, which has never been terminated by an
appropriate notice to quit given by the trustees as landlord. I should perhaps
add that Miss Belson submits that the present difficulty facing the owners of
the property is entirely of their own making. She accepts that if the trustees
had had the legal estate vested in them by a vesting assent from the respondent
and themselves served a notice to quit and issued proceedings, the defendant
would have had no answer. As it is, however, she contends that the respondent
must fail.
Even assuming
that the argument so far is valid, it is at this point, in my judgment, that it
begins to run into difficulties. Any tenancy agreement granted by the trustees
was oral. Miss Belson rightly does not suggest that the rent book constitutes a
written tenancy agreement. The question therefore arises whether it was valid
as against the legal owner, namely the respondent. This depends upon what
powers the trustees have. They are defined by section 28 of the Law of Property
Act 1925, which so far as is material provides:
(1) Trustees for sale shall, in relation to land
. . . have all the powers of a tenant for life and the trustees of a settlement
under the Settled Land Act 1925, including in relation to the land the powers
of management conferred by that Act during a minority. . . .
It is here, as
it seems to me, that Miss Belson is hoist with her own petard. Section 42 and
section 18 of the Settled Land Act 1925 have the same effect in relation to a
tenancy created by the trustees as they did in relation to one created by Mrs
Robinson. Although the trustees had the same powers as Mrs Robinson to create a
weekly tenancy in favour of the appellant, it had to comply with the
requirements of section 42(5)(ii). It had to be in writing and it had to
contain an agreement for payment of rent. Moreover, the legal estate was not,
and is not, vested in the trustees. And so, by virtue of section 18(1)(a),
the effect of the arrangement, at best, was that the trustees, as statutory
owners, entered into an agreement to grant a weekly tenancy to the appellant.
Such an agreement could not on any footing be valid against the respondent. In
my judgment, Miss Belson does not succeed in establishing a contractual tenancy
which was valid
entirely.
The learned
county court judge reached the same conclusion that the plaintiff was entitled
to an order for possession by a different route and one that Mr Webber
supported in his submission to us. Indeed the judge did not really deal with
Miss Belson’s argument under the Settled Land Act 1925, saying that he
considered that a consideration of the Act was unhelpful. His judgment and Mr
Webber’s submission is to this effect. Mrs Robinson entered into a valid
contractual tenancy; notwithstanding that the contract was not in writing, it
was valid and enforceable by Mrs Robinson against the appellant and vice versa.
On her death the contractual obligation devolved on the respondent as Mrs
Robinson’s executrix and the legal estate also devolved on her under section 1
of the Administration of Estates Act 1925. Therefore the contractual tenancy
subsisted until terminated by the notice to quit. The trustees could not create
a new tenancy during the subsistence of the old and the acceptance of rent by
John G Dean & Co was simply a convenient method of collecting the rent on
behalf of the respondent as landlord, though she had to account for the rents
to the trustees. I am not persuaded that this is the correct legal analysis.
Mrs Robinson could not, as tenant for life, create any estate in the land
exceeding her own beneficial life interest unless she did so in accordance with
the provisions of the Settled Land Act 1925, notably section 42. But she did
not do so. Her own beneficial interest ceased on her death. It was as if Mrs
Robinson, at the time of granting the tenancy, said: ‘I will give you a weekly
tenancy, but because I am doing so orally I can only grant it during my
lifetime. It will have to cease when I die because I have no power to extend it
beyond that time.’
The judge also
referred to the doctrine of estoppel. He held that since Mrs Robinson and the
appellant were estopped from denying their relationship of landlord and tenant,
so after her death were the appellant and respondent equally estopped. Mr
Webber submitted that this was correct and he cited the case of Mackley
v Nutting [1949] 2 KB 55 in support of his submission. It is necessary
briefly to set out the facts of that case. Nutting, the contractual tenant of a
dwelling-house controlled by the Rent Acts, died in 1935. Since he made no will
and no grant of administration of his estate was obtained, the benefit of the
contractual tenancy vested in the President of the Probate, Divorce and Admiralty
Division under section 9 of the Administration of Estates Act 1925. The
tenant’s widow, Mrs Nutting, remained in occupation of the house and paid rent
weekly to the landlords, W & M Ltd, until her death intestate in 1946. The
defendant, Miss Nutting (her daughter), took out letters of administration to
her mother’s estate which were granted on March 27 1947. On May 5 1947 the
plaintiff, who had acquired the freehold reversion, gave notice to the
President to determine the tenancy. She sought possession of the premises from
the defendant. It was held that at the time of Nutting’s death the landlords, W
& M Ltd, had intended to grant a new contractual tenancy in favour of Mrs
Nutting which they were estopped from denying, that Mrs Nutting had she been alive
could have relied upon that estoppel against the plaintiff, and that the
defendant could do so as the personal representative of Mrs Nutting.
Consequently, the right to rely on the estoppel became a tenancy when the
interest of the President was terminated. The estoppel was necessary in that
case to defeat the plaintiff’s argument that the contractual tenancy existed
and remained in the President and therefore the landlords, W & M Ltd, could
not have granted a new contractual tenancy to Mrs Nutting. But the landlords’
power to grant the tenancy was not circumscribed by the provisions of the
Settled Land Act 1925.
In the present
case Mrs Robinson was estopped from saying that she had not granted a tenancy
to the appellant, but she was not estopped from saying that the contractual
tenancy could and would last only during Mrs Robinson’s lifetime, which was the
extent of her beneficial interest. It does not seem to me, therefore, that the
argument on estoppel takes the respondent’s case any further.
Mr Webber
sought to argue that the effect of section 18 of the Settled Land Act 1925 was
that the oral tenancy was void only as against the trustees, and that since the
trustees were not taking any point on it and were not taking proceedings
themselves the respondent could not assert that the tenancy had ceased on Mrs
Robinson’s death. But I do not see how this can be so. The disposition is void
except to the extent defined. It is not voidable or void against some people
and for some purpose but not against others.
In the result,
I would dismiss the appeal on this point, but on somewhat different grounds
from those given by the learned judge in his judgment.
There is one
final matter raised on the notice of appeal. The judge awarded the plaintiff
£1,330.83 by way of mesne profits. It is common ground that he was in error in
so doing; there was in fact nothing owing because of the arrangement whereby
the appellant paid the rent to John G Dean & Co. To that extent the appeal
will be allowed.
Agreeing in
the result, McCOWAN LJ said: According to Miss Belson’s analysis of the
legal position before this court, on the death of Mrs Robinson all that her
executrix (the respondent to this appeal) got was a bare legal title to the
property on trust to convey it to the trustees of the settlement created by Mrs
Davey’s will. The appellant’s tenancy from Mrs Robinson, Miss Belson submits,
died with Mrs Robinson, and accordingly Mrs Robinson’s interest as landlord did
not vest in the respondent.
It must
follow, and Miss Belson concedes, that on Mrs Robinson’s death the appellant
became a trespasser and that at that stage the respondent, as holder of the
legal estate, would have been entitled to obtain possession from her.
However, the
respondent was, at the time these proceedings were brought, still the holder of
the legal title, and indeed she remains in that position to this very day
because the trustees of the settlement have never called upon her to convey the
legal title to them. Why then is not the respondent entitled to possession as
against the appellant on the continuing ground that the appellant is a
trespasser? The answer, argues Miss
Belson, is that the appellant was granted a new tenancy by the trustees. Her
difficulty in that respect, however, is that the judge found that there was no
such new tenancy. That, in my judgment, was a finding of fact which he was
entitled to make on the evidence before him and which cannot be challenged
successfully before us.
It follows
that the respondent was entitled to judgment for possession without recourse to
the terms of the Settled Land Act 1925.
If it be
necessary, I would accept Mr Webber’s submission that there was a valid tenancy
as between Mrs Robinson and the appellant, the reversion of which passed to the
respondent on the death of Mrs Robinson and would remain in her until she
passed the legal estate to the trustees of the settlement. Accordingly, the
respondent was entitled to serve the notice to quit on the appellant and to
bring proceedings against her for possession.
If Mr Webber’s
submission is wrong and, moreover, recourse to the Settled Land Act 1925 is
necessary, I agree with my lord’s analysis of why this appeal should fail in
any event.
I cannot,
however, leave this case without deprecating the course taken in the court
below with regard to the pleadings. The case advanced by Miss Belson bore
little relation to the case pleaded in the defence. In particular, nowhere is
there to be found any reliance on a new tenancy granted to the appellant by the
trustees. It appears that neither Mr Webber nor the judge took any point on
this. Their motives were no doubt to save time and costs. However, I am bound
to say that in circumstances where a fundamentally new case was being produced
on behalf of the defendant at the trial, it was unwise not to insist on Miss
Belson’s pleading this case precisely in an amendment of the defence. This
would have had the advantage of formulating the issues much more clearly for
the judge and for this court, as well as putting some rein on Miss Belson’s
ingenuity in devising new formulations of the appellant’s case.
The appeal
was dismissed save in respect of the award of £1,330.83 mesne profits; appeal
allowed on this issue only; order nisi for costs against the Law Society
granted.
