Trespass – Air-conditioning units – Respondent management company holding headlease of building – Headlease containing covenant against external alterations – Appellant holding underlease of flats in building – Appellant installing air-conditioning units on roof – Whether respondent entitled to damages for trespass – Whether unreasonably withholding consent for units in light of headlease covenant and freeholder’s opposition to units – Appeal dismissed
The appellant held underleases of two flats in a building, of which the respondent management company held a headlease granted to it by the freeholder in 1978. That headlease contained a covenant against alterations to the external appearance of the building. In 1980, the appellant installed several air-conditioning units, with associated pipework, wires, ducts and other apparatus, on the flat roof of the building with the respondent’s consent; it added more without consent.
In 2006, the appellant requested the respondent’s consent for refurbishment works to its flat and the replacement of the air-conditioning units. The claimant sought the approval of the freeholder, which indicated that although it was agreeable to the refurbishment, it did not consent to the installation of replacement air-conditioning units; it raised concerns regarding potential annoyance to neighbours from noise, vibration and heat. Thereafter, the respondent requested that the appellant remove all the air-conditioning units then in place.
Despite continued discussions, no agreement was reached over the proposed new units. The defendant none the less installed them. The freeholder continued to express concerns regarding the size and visibility of the units and the position of other flatowners who might also want to install air-conditioning units.
The respondent brought proceedings against the appellant for damages for trespass in respect of the installation of the units and pipework and applied for summary judgment on that claim. For the purposes of the application, it was assumed that, by reason of representations made by it, the respondent could not unreasonably withhold its consent. However, the judge rejected the appellant’s contention that a request for consent made in December 2008 had been unreasonably refused. He held that the respondent’s approach was reasonable in the light of the freeholder’s concerns and the risk that the giving of consent would breach the covenant in the headlease: see [2010] EWHC 1725 (Ch); [2010] PLSCS 192. The appellant appealed.
Held: The appeal was dismissed.
The appellant’s underleases did not entitle it to place anything on the roof even with the respondent’s consent, qualified or otherwise. Although the respondent’s consent to the placing of equipment on the roof in 1980 might have given the appellant certain rights in respect of that particular equipment, that did not assist it with regard to different equipment placed there in different circumstances. The appellant therefore had to rely on a collateral right based on the principles of proprietary estoppel. It was for the court to determine the scope and nature of the equity and it should not interfere with the parties’ legal rights to a greater extent than was necessary to give proper effect to the representation on which the estoppel was based.
It would therefore be artificial, inappropriate and unjust to determine the position between the respondent and the appellant in late 2008 and 2009 in exactly the same way, as though there were a tenant’s covenant not to make alterations without the landlord’s consent, that consent not to be unreasonably withheld. The matter ought to be considered more broadly than would be the case under the developed law on such covenants. Consequently, the grounds for refusal that could be taken into account were not confined to those that were present to the mind of the respondent at the time of the refusal, and the freeholder’s attitude both before and after the relevant date would be pertinent.
The respondent was not obliged to show that the proposed works would give rise to a breach of the headlease covenant in order to justify a refusal of consent on that ground. It had been entitled to take a cautious line with regard to the freeholder’s attitude. Where the freeholder had not committed itself to the view that what was proposed was not a breach of the headlease covenant, or that it would waive any such breach, the respondent could not be expected either to force the issue or to put istself at risk by giving consent to something that might expose it to a claim for breach of covenant. The freeholder had displayed a cautious approach throughout and there was no reason to suppose that its attitude would have been different had the appellant’s December 2008 request been passed on to it. At least one of its reasons for opposing the units, namely their size and visibility, was directly relevant to the headlease covenant. Accordingly, the appellant shad no realistic prospect of howing that the respondent had unreasonably refused consent for the retention of the apparatus or of defending the respondent’s claim.
James Hanham (instructed by Clifford Chance LLP) appeared for the appellant; Jonathan Arkush (instructed by Stockler Brunton) appeared for the respondent.
Sally Dobson, barrister
