Landlord and tenant — Dampness in flats — Tenants’ counterclaims for damages in landlords’ actions claiming arrears of ground rent and service charges — Three separate actions — Landlords’ appeal against county court judge’s decisions in favour of tenants on counterclaims — Judge found evidence of penetrating damp in flats due to the damp-course having been positioned below ground level, with consequent ‘bridging’ causing rising damp in the walls — Remedial work required included insertion of damp-course by silicone injection — Landlords’ covenant was to ‘maintain and keep the exterior of the building and the roof, the main walls, timbers and drains thereof in good and tenantable repair and condition’ — Review of well-known authorities from Proudfoot v Hart to Ravenseft Properties Ltd v Davstone (Holdings) Ltd — Court of Appeal held that judge (whose judgment was a ‘model of lucidity’) had correctly found that landlords were in breach of their covenant to repair; that the remedial work required did not go beyond repair as defined in the authorities; and that it did not involve the provision of a wholly different thing from that which was demised — Judge’s findings on tenants’ subsidiary claims in respect of breaches of covenants to clean and light premises also upheld — Criticism of judge’s calculation of damages rejected — Landlords’ appeals dismissed
These were
appeals by landlords, Elmcroft Developments Ltd, from decisions of Judge
Corcoran at West London County Court on counterclaims by tenants who were
defendants in three separate actions. Particulars as to the defendants
(respondents to the appeal), Miss V M H Tankersley-Sawyer, IAB Ltd and a Mr
Staines and Rev Ronald James Rogers, and their flats, are given at the
beginning of Ackner LJ’s judgment.
Steven
Whitaker (instructed by Michael Freeman & Co) appeared on behalf of the
appellants; Nicholas Dowding (instructed by Russell-Cooke, Potter &
Chapman) represented the respondents.
Giving
judgment, ACKNER LJ said: I should like at the outset of my judgment to pay
tribute to His Honour Judge Corcoran, who, on June 20 of last year, after a
hearing which lasted some seven days, gave a reserved judgment which was a
model of lucidity and has made our task in deciding this appeal a relatively
simple one.
The appellants
are Elmcroft Developments Ltd. They became head lessors of premises 13-20
Embankment Gardens, London SW3, which the learned judge describes — and this is
not criticised — as ‘a late Victoria purpose-built mansion block of 27 flats
including about seven basement flats, forming part of a larger terrace of
buildings of a similar character and provides high-class accommodation in a
sought-after and fashionable area of London’.
The appellants
were plaintiffs in the action. The respondents, who were the defendants in
three separate actions, hold subleases of three separate basement flats. IAB
Ltd have an underlease dated May 3 1972 of Flat 11, 13-16 Embankment Gardens,
for a term of 21 years and one month, commencing on May 3 1972. Ronald James
Rogers has an underlease of Flat 14, 13-16 Embankment Gardens. It is dated
April 25 1980 and is for a term commencing on that day and expiring on
September 19 2046 at the yearly rent of £100 payable on the usual quarter days.
He holds that underlease in trust for the third respondent, Miss
Tankersley-Sawyer. She had a periodic tenancy of Flat 11, 17-20 Embankment
Gardens from 1968, and then by an underlease dated September 23 1976 the flat
was let to her for a term of 60 years less three days from September 29 1955 at
the yearly rent of £100.
The appellants
brought their action against these three defendants in three separate actions,
claiming arrears of ground rent and service charges for the years 1980 and 1981
and advance service charges for 1982. The respondents admitted the claim for
ground rent. They disputed some items of service charges, with which we are not
concerned. They sought to set off against such claims as the appellants might
recover the amounts that they might be awarded in their counterclaim, and it is
the counterclaim with which we are concerned. That counterclaim claimed
specific performance and/or damages for breaches of covenants by the appellants
to repair and also for alleged non-performance of other covenants in the
underleases. The appellants denied that they were in breach of any of the
covenants of those underleases.
The learned
judge made, succinctly and most helpfully, certain findings of facts. I have
already referred to his description of the premises. He dealt with that which
was the subject-matter of the main dispute, namely the state of repair of the
premises, in this way: He held — and this is not disputed — that there was
constructed into the walls what was intended to be a damp-proof course,
consisting of slates laid horizontally. These existed in the external and the
party walls of the flat, but, owing either to a defect in design or
construction or bad workmanship, this layer of slates intended to be a damp-proof
course was ineffectual because it was positioned below ground. The result was
obvious. It allowed moisture to be drawn up from the ground by capillary
action, with the inevitable consequence that the flats were in a damp
condition, rising damp resulting from what was described as the bridging of
this damp-proof course, and parts of the interior of the main walls of the
flats had been adversely affected up to a height of about 1 to 1 1/2m. The
rooms in the flats were damp, and the plaster, decoration and woodwork needed
repair or renewal. The condition of the flats was described by him in his
judgment as follows: ‘Miss Tankersley-Sawyer’s flat.’ I quote his finding:
I find that
due to rising and penetrating damp the condition of this flat is appalling. It
feels and smells very damp. I wonder how she can tolerate living there. I
accept her evidence that the condition of the flat due to dampness has
deteriorated since early 1981 and she finds it more difficult to remain there
as time goes on; she has been unable to use the living room since 1979 and her
efforts to dry it out have proved unsuccessful; the bedroom is exceptionally
damp and she has to use an electric blanket constantly to keep the bed clothes
dry and is unable to keep the majority of her clothing in that room; she is
unable to put the hall area to any use now owing to its dampness whereas she
used to use it as a library and a dining-room (I take into account that some
dampness was caused by a plumbing defect in the flat above); the lavatory,
bathroom and kitchen are all badly affected by mainly rising damp. I accept her
evidence that she has been unable to entertain in the flat for some time now.
Also that it is more probable than not that owing to the condition of the flat
she has suffered from various ailments such as throat infections. In addition,
I accept her evidence that the light well adjacent to her flat has been flooded
on many occasions to an alarming extent and that sometimes the water comes to
the level of the window-sills and considerable difficulty has been experienced
in getting the water to run away and that causes evil smells to penetrate into
her flat generally and into the bedroom particularly. Further the stone
entrance steps from the street down to the basement area which provides access
to her flat became dangerous in June 1982 but in spite of a dangerous
structures notice being served on the plaintiffs on June 10 1982 work to remedy
the defects was not done until December 1982.
Then, in
regard to the Reverend Rogers’ flat:
Penetrating
or rising damp or both has affected all rooms. The flat has not been lived in
since 1979. The dampness appeared to be really noticeable from about October
1981. I explained in para 4 above how it came about that the Rev Rogers holds
the underlease. . . . The latter tried to dispose of the underlease but has
been unsuccessful.
That is a
reference to Miss Tankersley-Sawyer.
There is no
evidence that that was due to the state of the flat. It is proposed to
refurbish it after the damp-proof course has been put in and sell it. IAB Ltd —
the flat is occupied occasionally by a director, Mr Staines, for 2 to 3 weeks
at a time. Miss Ngango, his girl friend, has been visiting the flat from August
1980 and living there from August 1981. Neither rising nor penetrating damp is
visible in the living room and bedroom because these rooms are panelled,
although there is little doubt that such damp is present. However, the bathroom
is badly affected and fairly recently applied wallpaper is peeling off; similarly
affected but to a lesser extent is the kitchen. There is a musty smell present
in the flat which Mr Cooper Smith, surveyor, thinks may be caused by defective
drains.
So much for
the state of these flats. Then his findings as to the remedial works were these:
The remedial
works necessary to eradicate rising dampness in the walls is the installation
of a horizontal damp-proof course by silicone injection and the formation by
silicone injection of vertical barriers where the front and back external walls
meet the dividing walls.
As regards the
cost of that work, this would amount to £493.50 so far as Miss
Tankersley-Sawyer’s flat was concerned, £486.75 for the Rev Ronald Rogers’
flat, and £192.75 for the company.
I come now to
the covenant itself. The covenant in each case provided that the appellants
would
maintain and
keep the exterior of the building and the roof, the main walls, timbers and
drains thereof in good and tenantable repair and condition.
I do not need
to read the rest of that covenant.
In Lurcott
v Wakely [1911] 1 KB 905, Fletcher Moulton LJ cited the definition of
‘tenantable repair’ as drafted by Lopes LJ and adopted by Lord Esher in the
case of Proudfoot v Hart (1890) 25 QBD 42. At p 921 Fletcher
Moulton LJ quoted Lord Esher MR as saying this:
Lopes LJ has
drawn up a definition of the term ‘tenantable repair’ with which I entirely
agree. It is this: ‘Good tenantable repair’ is such repair as, having regard to
the age, character, and locality of the house, would make it reasonably fit for
the occupation of a reasonably-minded tenant of the class who would be likely
to take it, and he contrasts what it would mean in Grosvenor Square with what
it would mean in Spitalfields. The word ‘repair’ there does not refer to the
operation of repairing. That is proved by the fact that Lord Esher takes the
case of a floor being rotten, and he says that if it is rotten the tenant must
put in a new one. ‘Repair’ occurring in the phrase ‘good tenantable repair’ is
accepted by the Court as a description of a state, and the interpretation given
to the covenant is that, however he does it, the covenantor must keep the
premises in that state.
I asked Mr
Whitaker whether, taking the state which the learned judge described as being
referable to Miss Tankersley-Sawyer’s flat, he could say that it was in such
repair as, having regard to the age, character and locality of the house, would
make it reasonably fit for the occupation of a reasonably minded tenant of the
class who would be likely to take it. He said it was in such a state. I am
bound with all respect to say that that submission has by way of characteristic
more of courage than reality. To my mind it is unarguable that the state of
that flat in particular, bearing in mind the age, character and locality of the
flat, was such as to be quite unfit for the occupation of a reasonably minded
tenant of a class who would be likely to take it — very probably unfit for any
tenant, having regard to the description which the learned judge applied to it.
That is not
the end of the matter; but, before leaving Lurcott v Wakely, I
should like to quote a further part from the judgment of Fletcher Moulton LJ at
p 922, because he does refer to Lister v Lane [1893] 2 QB 212,
which was one of the cases upon which Mr Whitaker heavily relied. He says this:
Lister v Lane has no bearing whatever on this case
that is Lurcott
v Wakely
It certainly
contains nothing which says that a covenantor is in any way relieved from the
burden of his covenant because it may be that in order to fulfil it he will
have to a certain extent to rebuild the premises.
Finally,
before parting from that case, I refer to two short excerpts from the judgment
of Buckley LJ at p 924 and subsequently 926. He said this:
But if that
which I have said is accurate, it follows that the question of repair is in
every case one of degree, and the test is whether the act to be done is one
which in substance is the renewal or replacement of defective parts, or the
renewal or replacement of substantially the whole.
At p 926 he said:
All the
cases, to my mind, come only to this, that the question is one of degree, and
what we have to look to in the present case is to see whether the official
referee in his findings of fact has treated the front wall of this house as
being a subsidiary part of a larger structure, or has regarded the necessary
operations as amounting to substantially a re-erection of the house.
An excerpt
from the judgment of Lord Evershed MR in Wates v Rowland [1952] 2
QB 12, at p 23 was quoted by this court in Brew Bros Ltd v Snax
(Ross) Ltd [1970] 1 QB 612. This is what the Master of the Rolls said,
after setting out two plain examples:
Between the
two extremes, it seems to me to be largely a matter of degree, which in the
ordinary case the county court judge could decide as a matter of fact, applying
a common-sense man-of-the-world view;
and in the Brew
Bros case, at p 640, Sachs LJ said:
It seems to
me that the correct approach is to look at the particular building, to look at
the state which it is in at the date of the lease, to look at the precise terms
of the lease, and then come to a conclusion as to whether, on a fair
interpretation of those terms in relation to that state, the requisite work can
fairly be termed repair. However large the covenant it must not be looked at in
vacuo.
These various
well-known authorities were all viewed again by Forbes J in the case of Ravenseft
Properties Ltd v Davstone (Holdings) Ltd [1980] 1 QB 12. The facts
are quite irrelevant to this case, but he held — and this was in no way
disputed by Mr Whitaker as being a wrong approach — that it was a question of
degree whether work carried out on a building was a repair or work that so
changed the character of the building as to involve giving back to the landlord
a wholly different building to that demised.
In view of the
learned judge’s findings of fact, I see no problem at all in deciding this
matter as one of degree. I fully accept the learned judge’s findings, which
were these:
This is not a
case, therefore, where the dry condition of the premises can be achieved only
by, for example, the reconstruction or renewal of the whole of the
subject-matter of the covenant or by making a substantial alteration in the
design or structure of the building or the main walls thereof. It does not
involve the demolition and rebuilding of any wall nor does it involve any, or
any major, structural alterations.
He went on to
say that, as a matter of degree,
the work
which the appellants will be required to undertake is not such that will
involve the plaintiffs in giving to the defendants a new or a wholly different
thing from that demised. That work does not involve a change in the nature and
character of the flats, nor do the flats undergo a radical change by the
insertion of a damp-proof course; one exists, albeit one which became
ineffective by being bridged.
Mr Whitaker’s
sheet anchor is a case, Pembery v Lamdin [1940] 2 All ER 434.
That was a case in which there had been let premises known as 62 Blandford
Street, Marylebone, consisting of a shop and premises on the ground floor,
together with what Slesser LJ referred to as ‘a cellar for the most part built
into the ground, without any precautions against damp oozing through the porous
bricks into the cellar’. The remedial work necessary was extensive. It involved
removing panelling from the walls, cleaning down, asphalting the walls, and
building a 4 1/2-inch wall inside to keep the asphalt in position, and laying a
new concrete floor to prevent water coming under the walls. It was held that
the landlord was not liable under his repairing covenant because otherwise it
would have involved ordering him to give the tenant a different thing from that
which was demised.
I personally
find this case of no assistance at all. It does not involve the letting of a
flat. It involved letting of premises that contained this cellar in a building
which was built some 100 years before the court considered the problems. That
must be round about 1840. We are concerned with a letting a few years ago of
what was built as a separate self-contained flat and a flat in a high-class
fashionable residential area in the centre of London. I entirely agree with
what Forbes J said in the Ravenseft case at p 939, that this was a
decision arrived at by considering the question as one of degree. That view was
followed by the learned county court judge, and I consider that he was wholly
right in so doing.
Mr Whitaker
criticises the learned judge for having regard to what he considered as a
relevant factor and helpful guide, although not the only one, to use his words.
That was because of the cost of the work required, which he considered to be
modest in relation to the value of the whole premises. He said this:
The
plaintiffs’
that is the
appellants’
leasehold
interest in the whole premises is £50,000
the amount
which they paid on the assignment in 1981
Of course
they covenanted with the freeholders to do very extensive works pursuant to a
schedule of dilapidations served on the plaintiffs’ predecessors in title. As
to the cost of the works I consider the appropriate sum is that for the
insertion of the damp-proof course in the three flats, namely
and he gives
the total, £1,173.50
I have
already dealt with the point made on behalf of the plaintiffs that the other
basement flats in the whole premises should be taken into account. The cost of
the work then is small in relation to the value of the plaintiffs’ interest. If
the ‘associated work’ (replastering, redecoration etc), costing another £4,613.73,
is taken into account, the cost would not be a substantial part of the value of
the plaintiffs’ interest. Mr Whitaker complains that he
the flats into account. In regard to that, the learned judge said he had no
evidence with regard to the other flats and he was not going to speculate. Mr
Whitaker says that his proper approach should have been to take the cost per
flat and the value of the appellant’s interest in that flat. I do not think it
is necessary to go into the evaluation of this guide, which is only a guide so
far as it concerns this case. To my mind, the facts speak so clearly for
themselves in regard to whether this was reconstruction or renewal of the whole
as to make any further assistance from another source quite unnecessary.
I therefore
conclude that the learned judge was wholly right in the decision which he made
as to the failure by the appellants to comply with the repairing covenant and
their obligation in regard to curing the damp by using the only practical
method at this price, namely, injecting silicone into the wall. Mr Whitaker was
at one stage prepared to concede that, as the plaster became saturated (which,
of course, it was), his clients had the obligation to do the necessary patching
— that is removing — the perished plaster and renewing it. I am bound to say
that concession made the resistance to inserting the damp-proof course a
strange one. The damp-proof course, once inserted, would on the expert evidence
cure the damp. The patching work would have to go on and on and on, because, as
the plaster absorbed (as it would) the rising damp, it would have to be
renewed, and the cost to the appellants in constantly being involved with this
sort of work, one would have thought, would have outweighed easily the cost in
doing the job properly. I have no hesitation in rejecting the submission that
the appellants’ obligation was repetitively to carry out futile work instead of
doing the job properly once and for all.
So much, then,
for the main issue raised in this appeal. There are two subsidiary matters. The
first is the construction of the lighting obligation so far as it affected the
landlords, the appellants. It was alleged by the respondents that the appellants
were in breach of the covenants in regard to cleaning and lighting the
premises. The learned judge found in their favour, both as to cleaning and
lighting. The complaint in this appeal is not that he was wrong in both
regards, but that he was only wrong in so far as he found them in breach of
their obligation to light.
The material
part of the lessors’ covenants is to be found in clause 3, the material words
reading as follows: ‘(b)’ — I leave out unnecessary words — ‘To keep the said
entrance hall, stairs, passages’ (and then a gap) ‘well lighted during the
hours of dusk, darkness and dawn and cleaned at all times’. The learned judge
said this, and I can do no better than quote him:
The issue is
whether the covenant to clean and light extends to the exterior common parts
including the front and rear basement external ground areas (the defendants’
contention) or does it refer to the interior of the building only (the
plaintiffs’ contention)? The wording of
certain of the defendants’ covenants points to ‘passages’ being restricted to
the interior of the building (eg clause 3(m); 3(p) and 3(r) but when considered
overall the underlease, in my judgment, is not so restrictive. The demise to
the underlessees is a residential flat situate or, the basement floor of the
building, together with the use in common with the lessor and its other tenants
and all other persons entitled thereto of the entrance hall, staircase,
landings, passageways and lift in or about the said building for the purpose of
obtaining access to the demised premises and garden. Obviously the entrance
hall, landings and lift are ‘in . . . the said building’, but the staircase and
passageways ‘for the purpose of obtaining access to the demised premises and
garden’ could be either ‘in’ or ‘about’ the building. The only means of entry
to the basement flats (the subject matter of this action) and the garden is
from the basement external ground areas. The covenant for cleaning and lighting
refers to ‘the said entrance hall, stairs, passages . . .’ and thus points to
an earlier part of the same covenant relating to the repair of the ‘. . .
entrance hall, staircases, passages . . . intended for the common use of the
lessee and other occupiers of the said buildings . . .’ and this in turn comes from
the ‘together with’ part of the demise. Accordingly I find that the covenant to
clean and light extends to the external ground basement areas and those areas
are ‘passages’ within the meaning of the covenant (meaning a way or an area
through or by which a person may pass to obtain access or giving a means of
access, to the demised premises or the garden).
Mr Whitaker
concedes that the wording as quoted by the learned judge fully justifies his
decision, but he says that he is quite wrong to have regard only to wording;
one must look at the circumstances at the time of the letting, and those
circumstances were that no part of the exterior of the building was lit by the
landlords. He is not resisting the learned judge’s finding so far as cleaning
is concerned, because, although he resisted the allegation that he was in
breach of the cleaning obligation, it was part of his case that at the time and
at all material times the cleaning had been properly carried out. The learned
judge found against him as a matter of fact.
This is not a
case in which rectification has been claimed on the basis that what is to be
found in the lease does not truly represent the bargain made by the parties.
This is a question of interpreting, in the light of the words used in the lease
and the relevant surrounding circumstances, what is the obligation of the
appellants, the landlords. The surrounding circumstances are not limited to the
lighting which was being provided and its limited nature at the time when the
sublease was granted. I have already referred to one of the surrounding
circumstances, namely, that the only means of entry to the basement flats and
the garden was from the basement external ground area. In addition, there is
the fact, undisputed, that the outer walls were not demised and therefore the
tenant was not entitled to affix any lighting or cabling to the outer walls.
There is the further circumstance, to which the learned judge refers, that Miss
Tankersley-Sawyer found it dangerous and inconvenient to gain access to her
basement flat. She had to use steep stone entrance steps and found difficulty
in inserting a key into her entrance door, and because of this and
objectionable intruders invading the rear basement areas at night, causing her
alarm and distress, she installed three lights, one at the front and two at the
back, and they were wired into her electricity meter. The learned judge
accordingly found that it was reasonable for her to install these lights for
the purpose of access to her flat, so that she could enjoy normal use of it.
‘To comply with the covenant’, he said, ‘to keep this area well lighted at the
times specified presupposes the provision of such lights as are necessary and
then meeting the expense of the electricity used.’ Those are relevant surrounding circumstances;
and, in my judgment, the learned judge was wholly entitled to conclude that the
appellants were in breach of their covenant.
The final
matter relates to his calculation of damages for the inconvenience and distress
suffered by the tenants as a result of their having to tolerate the rising
damp. The learned judge said this:
(i) According to the agreed surveyor’s report
there is rising damp in the internal walls of the defendants’ flats. These
walls are non-loadbearing internal walls which I have found are the
responsibility of the defendants, under their repairing covenants, and require
the same work to eradicate rising damp as in the case of the main walls for
which the plaintiffs are responsible, namely, insertion of a damp-proof course
and associated works. Further, according to the agreed report, the floors to
the defendants’ basement flats do not incorporate an effective damp-proof
membrane and it is necessary to incorporate one in the floors. Under the
defendants’ repairing covenants they are responsible
and then he
sets out their obligations.
As I
understand it, it is accepted that the incorporation of a damp-proof membrane
in the floors is the defendants’ responsibility.
When he came
to calculate the damages, he said this:
I bear in
mind in addition to all the other matters referred to in this judgment that the
discomfort, inconvenience etc suffered by the defendants was less at the
beginning of the two-year period than it has been over about the last six
months and what it will be until the necessary work is completed. In my
judgment the appropriate sum for damages in the case of Miss Tankersley-Sawyer
is £2,600.
Then he deals
with the Rev Rogers and the company, and in regard to them there is little or
no complaint.
What is urged
by Mr Whitaker is that, in assessing damages for this inconvenience, the judge
is obliged to make a deduction for part of the inconvenience resulting from
Miss Tankersley-Sawyer’s failure in relation to the internal walls and the
floor, and that he did not do so. In the very next paragraph to that which I
have just read, where he sets out his calculation, he says:
Certain
joinery work specified in the agreed surveyor’s report is defective. Three main
causes are given, one being contact with damp brickwork causing frames to
decay. That seems to be due to rising damp. Subject to an allowance being made
for rising damp from the floor and internal non-loadbearing walls for which the
tenant is responsible and which I assess at 20%, the plaintiffs are liable for the
cost of remedying these defects in the cases of the defendants Miss
Tankersley-Sawyer and IAB Ltd in the sum of £16 each.
To my mind, it
would indeed be very strange, the learned judge having, before he reached the
figure of £2,600, already drawn attention to the obligation by the tenants in
relation to the internal walls and floor and then, after dealing with the
damages for them, referred to a specific item of joinery work which had been
quantified and then made a deduction because of an allowance
floor, giving rise in part to the defective joinery, if he did not also bear in
mind the need to make a similar type of deduction in principle from his general
assessment of damages for inconvenience. He has not said he has done so in
terms. That is clear; but the submission was made clearly to him, and I am not
prepared to infer that in as careful and as exhaustive a judgment as he
produced he would have overlooked giving the appropriate weight to that
submission. I think there is force in Mr Dowding’s observation that the figure
of £2,600, which is £1,300 a year, which in turn is approximately £26 a week,
is unlikely to represent the rental value of Miss Tankersley-Sawyer’s flat if it
had been in a proper state of repair. She herself gave evidence that she
expected to be able to dispose of the flat for approximately £40,000 when it
had been put into a proper state; and, if that is its value, £26 a week does
not represent what one would expect to be a fair return on the net capital. I
accordingly for myself am not satisfied that he did not make an allowance when
reaching his figures, and accordingly the appellant fails to satisfy me that
the judge made any error in fixing the figures which appear in his judgment.
Accordingly, I
would dismiss this appeal.
WATKINS LJ
agreed and did not add anything.
The appeals
were dismissed with costs, legal aid taxation was ordered in regard to the
legally aided respondents.