Landlord and tenant – Construction of lease – Parking rights – Respondents holding long leases of flats in mansion block – Respondents seeking declaration of right to park in private road – Appellant headlessee opposing claim – County court finding in favour of respondents – Appellant appealing – Whether right to park excluded from demise – Appeal allowed
The respondents owned long leases of flats in Duchess of Bedford House in Holland Park, London, a 1930s mansion block which faced onto a private road known as Sheldrake Place East. There were three separate entrances to the property, and so in effect it was divided into three blocks of flats within the same building. Sheldrake Place East was part of a larger garden square, Sheldrake Place.
In the middle of Sheldrake Place were two other inter-war mansion blocks known as Campden Hill Gate. The appellant was the headlessee of Campden Hill Gate, and of the other parts of Sheldrake Place including the roads and central gardens.
For some time, car parking in Sheldrake Place, and particularly in Sheldrake Place East, had been a matter of contention between residents of the property and those of Campden Hill Gate. The respondents sought a declaration of their claimed right to park in Sheldrake Place.
The judge found that a right to park on Sheldrake Place East, appurtenant to the property, existed in a 1969 headlease. A subsequent 1974 headlease contained an express carve-out of rights and entitlements which were not to be passed on: (i) any ways, watercourses, sewers, drains, lights, liberties, privileges, easements, rights or advantages in through over or upon any land of the lessors except those now subsisting (the first limb); or (ii) which might restrict or prejudicially affect the future rebuilding alteration or development or redevelopment thereof or of any other adjoining or neighbouring property (the second limb).
The question was whether the right to park, having been reserved in 1969 as a legal easement in favour of the property, was then included in the demise by the lessor to the new headlessee in 1974. The judge ruled in favour of the respondents. The appellant appealed.
Held: The appeal was allowed.
1) The judge was well able to find, on the evidence, that in 1969 a substantial number of Duchess of Bedford House residents who owned a car or vehicle parked it or them in Sheldrake Place East, as did their visitors. Appellate courts should not interfere with findings of fact by trial judges, unless compelled to do so. That applied not only to findings of primary fact, but also to the evaluation of those facts and to inferences to be drawn from them.
It was relevant to consider the nature of the evaluation the judge made. It was a qualitative rather than a quantitative assessment. The judge recognised that himself in his judgment, including where he said there was a danger in trying to reduce his evaluation to a mathematical exercise; and that it was not necessary for him to make any particular finding as to the amount or number of residents, only to be satisfied that there were sufficient.
That was an understandable and correct approach. It was likely that the judge had fallen into error in assuming that the evidence had enabled him to say specifically that as many as 15 residents of the centre block of the property had cars and had parked them on Sheldrake Place East. However, the court was not persuaded that his overall evaluation was wrong, and it would not interfere with it Staechelin and others v ACLBDD Holdings Ltd and others [2019] EWCA Civ 817; [2019] 3 All ER 429 considered.
(2) The new leaseholder in 1974 would have wished to ensure that, as far as possible, the new leasehold arrangements being entered into were not less advantageous than those in place under the previous arrangements. It would naturally have wished to ensure that any rights “now subsisting” were preserved.
However, that interest was in tension with a countervailing interest on the part of the lessor which wished to avoid, to the extent possible, ceding control to its lessees of any rights which might inhibit plans for the future development of the estate, and wished to reserve all such rights to itself as far as it possibly could.
Having regard to those competing interests, the natural way in which to read the carve-out was as a compromise and the judge was correct to do so. The nature of the compromise was that although no new rights over other parts of the estate would be created by means of the 1974 headlease, any subsisting rights would be conveyed, unless they might restrict or prejudicially affect any rebuilding or alteration, etc works of the types described. The intention was that any such rights, which included rights over Sheldrake Place East, would remain in the hands of the lessor and would not be passed on to the new headlessee. The lessor would then have ultimate control over any rebuilding, alteration or redevelopment works which might impinge on those rights: Newman v Jones (22 March 1982, unreported), Moncrieff v Jamieson [2007] UKHL 42; [2007] PLSCS 201; [2007] 1 WLR 2620, Arnold v Britton [2015] EGLR 53 and Regency Villas Title Ltd and others v Diamond Resorts (Europe) Ltd and others [2019] EGLR 1 considered.
(3) However, the judge erred in concluding that the right to park, although a subsisting right, did not fall within the second limb of the carve-out. The judge had construed the second limb of the carve-out too restrictively. Had he given the words of the second limb their ordinary and natural meaning, he would have concluded that the right to park did fall within the carve-out, and was therefore excluded from the demise under the 1974 headlease. The right to park was of such a type that it might restrict or prejudicially affect any future rebuilding or alteration, etc of Sheldrake Place East. It was therefore excluded from the demise and, in effect, kept in the hands of the lessor. If any future rebuilding or alteration etc, were proposed which might impinge on the right to park, it would then be within the power of the estate to consent or not consent to it, by waiving the right or choosing not to. That fitted with the overall scheme of the 1974 headlease and with the scheme of the 1969 headlease, if the two were looked at together.
David Holland KC (instructed by Boodle Hatfield LLP) appeared for the appellants; Edward Francis (instructed by Edwin Coe LLP) appeared for the for the respondents.
Eileen O’Grady, barrister
Click here to read a transcript Campden Hill Gate Ltd v Duchess of Bedford House RTM Co Ltd
