Lands tribunal — Jurisdiction — Covenant in lease restricting use of property — Lease transferred subject to covenants — Tenant seeking modification of covenants — Whether covenants negative or positive — Whether tribunal having jurisdiction to hear application — Appeal dismissed
The appellants, as trustees of the Paddington Estate, were the landlord of a large house in London. The headlease, which had been made in 1951 between the appellants and the predecessor of the respondent tenant, contained covenants as to the use of the different floors of the building. A deed of variation dated June 2001, permitted part of the property to be used for private residential accommodation. The property was transferred to the respondent in November 2001, following which she applied to the Lands Tribunal for further modification of the covenants to permit additionally part of the basement to be incorporated either into a single basement flat or into a single dwelling on all three floors of the building.
The landlords argued that the premises were not “affected by any restriction arising under covenant” for which the tribunal would have jurisdiction under section 84 of the Law of Property Act 1984. The Act confined the tribunal’s jurisdiction to covenants that restricted user. The appellants contended that covenants contained positive obligations not restrictive covenants, and that the tribunal’s jurisdiction did not extend to a case in which the covenants were positive in nature. That contention was ordered to be heard as a preliminary point. The tribunal ruled that it did have jurisdiction: Re: Hyde Park Gardens London WC2, unreported 14 January 2004, LP/34/2002. The appellant landlords appealed against that decision.
Held: The appeal was dismissed.
The judge had come to the correct conclusion for the right reasons. It was not accurate to construe the obligation in the lease as being positive and rendering the tenant liable to find herself in breach of covenant in circumstances that she had no power to prevent. The parties could not have intended that result in 1951. If they had, it would have been clearly spelt out. The covenants, when read in context, were, to all appearances, restrictive, and, as such, within the tribunal’s jurisdiction.
The court’s task was to construe the lease so as to ascertain the parties’ intention at the time the lease was entered into. The court had to evaluate the substance of the covenants and not confine consideration to the form. Each covenant had to be construed in the context of the particular lease and cases in which particular but dissimilar covenants had been considered were not usually helpful, except by showing that positive obligations enforceable in contract did not come within the jurisdiction of the tribunal: Abbey Homesteads (Developments) Ltd v Northamptonshire County Council [1986] 1 EGLR 24, Re Blyth Corporation’s Application (1961) 182 EG 679, Montross Associates Investments SA v Moussaieff [1990] 2 EGLR 61, Westminster City Council v Duke of Westminster [1991] 4 All ER 136 considered.
James Thom (instructed by Radcliffes LeBrasseur) appeared for the appellants; Kirk Reynolds QC (instructed by Black Graf & Co) appeared for the respondent.
Eileen O’Grady, barrister
