JUDGE LEVY:
1. In a claim issued on 27th September of last year, Creditforce Ltd. and James Donald Hanson, trading as Seymour Holdings, brought proceedings against those they believed to be the trustees of the Portman Estate, for a declaration that the claimant was entitled to inquire the freehold of the “house and premises known as 62/64 Seymour Street and 1 Seymour Place and 10 and 11 Hampton Gurney Street, London W1H 5AF, under the Leasehold Reform Act 1967” and for costs. I will refer to the Leasehold Reform Act 1967, as amended, as “the Act”.
2. When the case was called on this morning it was brought to my attention that there may have been an error in the description of the defendants, and I gave leave, which was unopposed, for the name of the parties to be amended.
3. The particulars of claim read as follows, and they are brief:
“1. The claimant is the tenant of the house and premises described in the claim under which the defendants are the landlord. The claimant has owned the lease for more than two years.
“2. By a notice of tenant’s claim in the prescribed form dated 24th April 2006, the claimant claimed the freehold of the house and premises under the Act. The claimant’s lease is a long lease within the meaning of the Act.
“3. By notice in reply dated 21st June 2006 the defendants did not admit the claimant’s right on the single ground that the house and premises described in the notice of tenant’s claim is not a house within the meaning of section 2(1) of the Act as amended.
“4. It is denied that the ground given for not admitting the claimant’s right is a valid one, and the house and premises described in the notice is a house within the meaning of the section.”
A declaration is sought.
4. The defence is equally brief:
“1. Paragraph 1 is admitted except that the demised premises are not a house and except that the freehold is owned not by the first and second and third defendants but by the third defendants jointly with others.” (That is a matter for which I gave leave to amend this morning.)
2. Paragraph 2 is admitted. However it is denied that the claimants have the right to acquire the freehold under the Act and it is denied therefore that the notice is valid.”
5. The first sentence in paragraph 4 is noted; the second sentence is denied. The second sentence is what this claim is all about.
6. There have been witness statements served, but no witnesses have been called in the course of the hearing because the facts are, in large part, agreed.
7. Section 2(1) of the Act provides:
“For purposes of this Part of this Act, ‘house’ includes any building designed or adapted for living in and reasonably so called, notwithstanding that the building is not structurally detached, or was or is not solely designed or adapted for living in, or is divided horizontally into flats or maisonettes; and
(a) where a building is divided horizontally, the flats or other units into which it is so divided are not separate ‘houses’, though the building as a whole may be; and
(b) where a building is divided vertically the building as a whole is not a ‘house’ though any of the units into which it is divided may be.”
8. It is common ground that a house is not prevented being a house within the section merely because part of it comprises business premises. It is common ground that the house is not prevented from being a house within section 2(1) merely because it is divided into flats.
9. It is common ground that the house here is largely designed or adapted for living in. The question for issue in the claim is whether the building is “reasonably so called”.
10. In the course of the hearing I have been referred to a number of cases, namely Lake v. Bennett [1970] 1QB 663; Tandon v. Trustees of Spurgeon‘s Homes [1982] AC 755; Hareford Ltd v. Barnet London Borough Council [2005] 4 2EGLR 72; Boss Holdings v. Grosvenor Estate West End Properties Ltd [2006] 1 WLR; Harris v Swick Securities Ltd [1969] 1 WLR 1605.
11. As may be expected of counsel of the calibre who appeared before me, my mind has vacillated during the course of the hearing as to what is the proper construction of the section, but at the end of the day I have come to a clear conclusion.
12. The starting point in the authorities so far as this claim is concerned is the Court of Appeal decision in
“Some things are clear. First, the sub-letting of the ground floor does not take the case out of the Act. (Harris v Swick Securities Ltd.) Second, the use of the ground floor for business purposes does not take it out of the Act. Several sections contemplate that part of the house may be used for business purposes. The only question is whether this is a ‘house’ within the definition of ‘a building designed or adapted for living in and reasonably so-called’? I believe this is the first statute in which Parliament has endeavoured to give a definition of a ‘house’, but the many statutes which have used the word ‘house’ without defining it, and the courts, have given it a wide interpretation. The first case was the most extreme, Richard v Swansea Improvements and Tramways Co. [1878] 9 Ch 425. It was under the Land Clauses Consolidation Act 1845. It was held that a massive building was a ‘house’ though part of it was residence, part cottages and part manufacturing. It was all held to be ‘a house’. That is going a long way. It would not apply, I should think, to the present Act, because of the words ‘reasonably so-called’.
“In the Rent Acts too there was no definition of a house, but under them a hotel was held to be a house (see Epsom Grandstand Association Ltd. V Clarke 1919, 35 TLR 525) and also a building which was part dwelling and part business premises (see Ellen v. Goldstein 1920, 123 TLR 644. Quite recently in Luganda v. Service Hotels Ltd [1969] 2 Ch 209, this court held that a building (four houses knocked into one) with 88 rooms, which were let off in furnished rooms, was ‘a house’. I doubt whether the whole would be ‘a house’ within the Leasehold Reform Act because of the limitation ‘reasonably so-called’ though each one of the four might be…
“In the Housing Act there was no definition of ‘a house’ but we considered it in Ashbridge Investments Ltd. v. Minister of Housing and Local Government [1965] 1WLR 1320. I venture to suggest that ‘a house’ in the Act – that is, the Housing Act —means ‘a building which is constructed or adapted to be used as or for the purposes of a dwelling’. It would appear that in the Act Parliament adopted those words but added a limitation ‘reasonably so-called’, It is quite plain that this building was ‘a house’ within all these earlier statutes. The point is: what is the limitation conveyed by the words ‘reasonably so-called’? I would not pretend on this occasion to attempt to define the limitation, but it may be good to give an illustration. I do not think that a tower block of flats would reasonably be called ‘a house’ but I think that a four-storey building like the present one is reasonably called ‘a house’. Take it in stages First, if the tenant occupies the building entirely by himself, using the ground floor for his shop premises, that would plainly be a house reasonably so-called. Secondly, if the tenant, instead of using the ground floor himself for business purposes, sub-lets it, that does not alter the character of the building; it is still ‘a house’ reasonably so-called, and that is this case.”
13. The next and possibly most important of the cases cited to me was Tandon v
Trustees of Spurgeons Homes Ltd. Taking it from the headnote, a majority of their Lordships held that:
“As long as a building of mixed use could reasonably be called ‘a house’ it was within the meaning of ‘a house’ for the purposes of the Act of 1967, even though it might reasonably be called something else; but whether it was reasonable to call a building ‘a house’ was a question of law; but if a building was designed or adapted for living in, i.e., for occupation as a residence, only exceptional circumstances such as nobody could reasonably call it ‘a house’ would justify a Judge holding that it could not reasonably be so-called; and that the Judge had come to the right conclusion on the facts of the case.”
14. The headnote is taken largely from the speech of Lord Roskill. The relevant passage starts at page 764. After the section has been set out, Lord Roskill said this:
“My Lords, looking at the words of this sub-section and regardless of any authority upon its construction, two points seem to me clearly to emerge. First, though the definition of ‘house’ is expressed to be inclusive and not exhaustive, the words ‘any building … reasonably so-called’ are intended as words of limitation, for clearly premises are i not to be treated as ‘a house’ within the sub-section merely because they are a building designed or adapted for living in, unless they can in 3 ordinary parlance be reasonably called ‘a house’.
“Secondly, premises are not to be treated as without the definition merely because the building is not structurally detached or ‘was [not] or is not solely designed or adapted for living in’. Nothing in the present case turns upon ‘not structurally detached’ for these premises were not structurally detached; but the latter word, which I have italicised, suggests to my mind that Parliament intended in certain circumstances to extend the benefits and privileges of the Act of 1967 to tenants of premises not exclusively designed or adapted for living in. If that is the approach, the next question is: what are the circumstances in which the tenant of such premises can successfully assert a claim to those benefits and privileges
“(f) My Lords, learned counsel for the appellant attached three propositions from which learned counsel for the respondent did not dissent. First, the question whether a particular premises were a house within the definition was a mixed question of fact and law, so that if there were no evidence upon which a particular conclusion one way or the other was reached, that conclusion could be reviewed on appeal. Secondly, if the premises might also be called something other than ‘a house’ within the definition, that fact alone did not prevent those premises from being called “a house” … reasonably so-called’, Thirdly, it was implicit from such previous decisions as there had been upon this question that premises used for non-residential purposes as well as residential purposes could in law be ‘a house’ within the 27 definition, and that it depended upon the character of the premises in question whether by reason of their mixed user they fell within or without the definition.
“My Lords, in agreement with both learned counsel I accept these propositions as correct, that they re-state the question rather than resolve it. How is the ‘character’ of the premises to be determined? It is tempting to look at the history of the premises, and, having regard to the language of the original demise, which I have already quoted, learned counsel for the respondents naturally urge your Lordships to do so. As already stated, these premises were built in 1881 as ‘a dwelling house and a shop” I think it clear, having regard to the definition of ‘relevant time’ in section 37(1)(d) of the Act 1967 that the question must be resolved as at the time of the tenant’s notice under the statute. The character of the premises at that time would usually, though not’ I invariably, reflect its history. Accordingly, the history would be relevant though certainly not conclusive.
The terms of the lease will also be relevant, as will a proportion of the premises respectively used for residential and non-residential purposes, and also the physical appearance of the premises
“(g) The purposes of these words in the definition is clear. Tenants who live over the shop are not to be denied the right conferred by the Act, whether they themselves trade from the shop or not, merely because the building in which they work and live accommodates the two users. Such a tenant occupies the house as his residence even though it is also used for another purpose.
“Small corner shops and terraced shops combined with living accommodation are to be found in almost every town and village and
15. At this stage I will refer to a passage from the judgment of Camwath L.J., who agreed with Laws, L.J., who gave the first judgment in the decision in v Grosvenor Estates. At paragraph 25 of his judgment, he said this in regard to new provisions in the Act:
“I agree. I would just add one comment at the background of these provisions. They were originally introduced in 1967 and have been amended and extended since. In his skeleton argument Mr Radevsky said: ‘Although the 1967 Act has been significantly amended, since the original enactment section 2(1) has not been touched and is to be construed therefore by reference to what Parliament intended in 1967.’ (25) In the event, we did not have to explore that sentence in argument, but I would be inclined to respectfully disagree with him. It seems to me that we have to look at the Act as it now is after the amendments. Looking back at the earlier cases, it is clear that the former resident’s position affected the balance of the arguments. That having disappeared, his attention is focused on the central part of the section 2 definitions, and undoubtedly the character of the argument is affected by that. It seems to me that we must look at the Act as it now stands. (26) I would also question Mr Johnson’s reliance on a passage from the dissention speech of Lord Fraser in Tandon. Lord Fraser saw the expression ‘designed or adapted for living in’ as potentially relatively wide, but then limited by the qualification that the building must be a house ‘reasonably so-called’. However, that, as I understand it was not the approach taken by the majority. Lord Roskill gave the leading speech. He did not attribute to the requirement that it should be a house ‘reasonably so-called’ such an important role. Following the Court of Appeal in
16. He read the passage that I have already read.
17. With that by way of background I turn to some of the factors on which I have been addressed. First, at page 112 of the bundle, there is a picture of the front of the building at 62 and
18. There, there can be seen on the ground floor two shops, then called
19. I have been taken to the lease, as originally granted, which is found at pages 113 onwards of the bundle. Happily, because that is in manuscript, there is a typescript of it, which I have read. It was made on 5th March 1877. The demise reads:
“That in consideration of the said lease, the said lessee having erected and built the messuages and premises hereafter described … demise .,. all that piece or parcel of ground situated on the north side of Seymour Street, Portman Square, in the Parish of St Marylebone in the County of Middlesex facing south upon the said street, together with the messuages, tenaments and shops erected and built thereon .. . and which said messuages or tenaments and shops are now in the occupation of the said lessee or his under-tenants …“
20. Then the dimensions are given. The term is from 25 March 1872 for 80 years.
21. At page 118 of the document the user clause is set out: “And as for the upper parts there is a prohibition of them being used or occupied or permitted or suffered to be used or occupied the upper storeys of flats of the said premises for the purposes of any art, trade, business whatsoever or otherwise than as a private dwelling-house within the licensing and consent in writing under the head of the landlords.”
22. The agreement on which this claim is based is an agreement dated 28th December 1960 at page 29, which also states it is a lease of messuages, shops and premises. However, as was pointed out to me, this is a standard pro forma used by the Portmari Estates and after “messuages, shops and premises” there has been put in manuscript, wherever those words appear, “S, S and S”. The foot of that page shows that the lease was varied by a variation dated 22’ June 1993, and a further variation dated l5 July 1997; and a licence to alter of that date.
23. Effectively the user has changed from that originally granted. In the first lease each of the five upper floors of the building were for one flat. Under the new lease each of those floors were divided into two flats, and it is common ground that the building originally contained five flats and now contains ten. It is common ground that there are shop premises on the same floor that continue to be at the rear, and the whole area of the premises is something under 12,000 square feet. It is also common ground that under 25 per cent of the area is for business as opposed to residential use.
24. It is under those circumstances and against that background that I have to consider whether the building is a house reasonably so called. It is obviously a building designed or adapted for living in. Is it “a house reasonably so called”?
25. In his submissions, Mr Sefton very properly made the point that there is no authority of a building of this size having been partly a house, but that is not definitive. Having made submissions on the authorities, which I have referred to, he submitted first of all that a building designed or adapted for living in does not necessarily mean it is a house in the section; it is a question whether it was a house reasonably so called. He referred me to the passage from
26. At pages 158 et seq in the bundle, some correspondence had been exhibited between the City of
“This property has been converted from a single family house into ten self-contained units; therefore it is considered to be a house in multiple occupation (HMO) within the meaning of section 354 of the Housing Act 1985 as amended…
“I would be happy to assess any evidence you have that this property was built as self-contained flats.”
27. In fact the local authority was not provided with the plans, which I have seen, which suggest that that clearly was the position.
28. On 3” March 2006 a further letter was sent to the same addressee stating that the Council believed that this property was converted from a single family house to self-contained flats. That that is wrong does not take the case very much further. However, on March 2006 a notice was given to Flexiplate Ltd per the secretary:
“1. You are the person having control of the house in multiple occupation
of…”
29. The address is given of the house, and works were required to be done. In the notes to the section that was sent, there is this, under “House in Multiple Occupation”.
“A house in multiple occupation is a house (including any part of a building, such as a flat, which was originally constructed or subsequently adapted for occupation by a single household) which is occupied by persons who do not form a single household … section 345.”
30. Mr Sefton, very properly, submitted that what is the definition clause of a house in the Housing Act is not of great assistance when I have to look at what is a house for the purpose of the new Act; but it is clear that the local authority did treat this building as a house, albeit a house in multiple occupation.
31. Mr Sefton also pointed out that in Tandon the history of the building was considered important, and as to the history he submitted that the property has always been a building on five floors, with shops on the ground floor; but there has never been a single unit occupying the whole of the area. He says it is a block of flats, and does not have the character of a flat.
32. Mr Radevsky, in answer to that, says that a building is a building, and this property has always been in multi-occupation, but looking at the house as it now is and looking at the picture of what it looked like when it was built, it can reasonably be called a house, as there are other buildings of this size and shape to be found in London which are houses, whether or not they are used as one residence.
33. Mr Sefton pointed out that the leases that I have mentioned do not describe it as a house, as a single house, but uses the plurals. He also submitted that the passage in
34. In both his opening speech and his reply Mr Radevsky submitted that if one takes into account all the matters which Lord Roskill and Carnwath L.J. had said, the three questions posed by Lord Roskill in Tandon should be answered in his favour.
35. I return to the final page of Lord Roskill’s speech:
“As long as a building of mixed use can reasonably be called a house, it is within the statutory meaning of ‘house’ even though it may reasonably be called something else.”
36. Having carefully considered the submissions both of Mr Sefton and Mr Radevsky, and not without hesitation, I think that this property can reasonably be called a house. To take the third question, it has been designed for living in, and it is designed for occupation as residences. Only exceptional circumstances, Lord Roskill decided, would justify it not being reasonably called a house, notwithstanding the fact that there are three doors — and they are shown on the plan — and all the matters which Mr Sefton has urged on me, I have come to the decision that it is reasonable to call this building a house, and I so determine.
