Landlord and tenant — Construction of covenant in lease — Agricultural holding — Whether a covenant ‘not to assign or underlet any part of premises without the consent in writing of the landlord such consent not to be unreasonably withheld’ prohibited the assignment or underletting of the whole of the premises — Declaration sought by plaintiff tenant that she was entitled to assign or underlet the whole of the demised premises without requiring such consent — Plaintiff contended that, as it was accepted that a covenant against assignment of the whole did not prohibit an assignment of part, the converse should hold good — Defendant submitted that if, after an assignment or subletting of the whole of the demised premises, one asked the question, Has there been an assignment of any part?, the answer was plainly ‘yes’, because there had been an assignment or underletting of every part — Nicholls J agreed with this submission — He rejected as inconclusive arguments for the plaintiff drawn from different parts of the lease, where the draftsman had been careful to use phrases such as ‘the farm or any part thereof’ when it had been intended to cover the whole — Contrary arguments could be based on other phrases — The words used in the covenant, ‘not to assign or underlet any part of the premises’, were plain and unambiguous and their meaning did not admit of doubt — Held accordingly that the covenant on its true construction prohibited the plaintiff tenant from assigning or underletting the whole or any part of the premises in question without the consent of the defendant landlord — Declaration refused
This was an
originating summons whereby the plaintiff, Nora Field, sought a declaration
that she was entitled to assign or underlet the whole of the agricultural
holding known as High Ashes Farm, Abinger, Surrey, of which she was the tenant,
without the consent of the landlord, the defendant; Terence Barkworth.
Geoffrey
Stephenson (instructed by Downs, of Dorking, Surrey) appeared on behalf of the
plaintiff; David Neuberger (instructed by Sharpe Pritchard & Co, agents for
Tattersall & Sturt, of Bournemouth) represented the defendant.
Giving
judgment, NICHOLLS J said: The question raised by this summons is whether a
covenant in a lease not to assign or underlet any part of the demised premises
is broken by an assignment or underletting of the whole of the demised
premises. There is no authority directly in point.
The lease was
made on December 13 1948 and by it the landlord demised a farm known as High
Ashes Farm at Abinger in Surrey and comprising a farmhouse, three cottages,
farmbuildings and some 118 acres of agricultural land. The lease was for a term
of 21 years. It was professionally drawn and contained covenants of the type
that one would expect in a lease of this nature. I need mention only some of
the provisions. A rent was reserved in the usual way and in clause 2 certain
exceptions and reservations in favour of the landlord were set out. Among those
(in subclause (5)) was power for the landlord to enter upon ‘the farm or any
part thereof’ to view its condition, and power to enter upon ‘the farm or any
part thereof’ for the purpose of carrying out repairs or improvements. In
subclause (6) of the same clause there were reserved to the landlord rights of
way across ‘any parts of the farm’ for purposes of access and otherwise as
there set out.
The tenant’s
covenants were set out in clause 3 and the subclause I am concerned to construe
is subclause (24). So far as material that subclause reads:
Not to assign
or underlet any part of the premises without the consent in writing of the
landlord such consent not to be unreasonably withheld and prior to any such
assignment or underletting not to permit any person or persons other than the
tenant, his bailiff, servants or workmen to reside in the farm house and
cottages hereby demised.
The landlord’s
covenants were set out in clause 4 and they included in the insurance provision
words to the effect that if ‘the said farmhouse and buildings and cottages or
any of them or any part thereof’ should be damaged by fire then there was to be
reinstatement in the usual way. The forfeiture clause was clause 5(5) and this
provided that in certain events the landlord might re-enter into or upon ‘the
farm or any part thereof in the name of the whole’ whereupon the term was to
determine.
At the end of
the lease appeared a schedule listing the fields and areas of the demised
property by reference to ordnance survey numbers with a description and a
stated acreage.
The plaintiff
is the present tenant under the lease and the defendant is entitled now to the
reversion. The plaintiff is concerned to know whether an assignment or
underletting by her of the whole of the demised premises requires the consent
in writing of the defendant. For the plaintiff it was submitted, first, and
this was common ground between counsel, that a covenant against assignment or
subletting or parting with possession is not a covenant which is implied by law
into a lease and that, therefore, such a covenant must be express and the
lessor must take care expressly to prohibit all such acts as he may wish to
exclude. Further, and this also was not in dispute, a covenant against
assignment of the whole of the demised premises simpliciter does not prohibit
the assignment of part only of those premises. For the plaintiff it was
submitted further that this case is the converse of that. Again, and still in
general terms, it was submitted for the plaintiff that a lease is to be
construed strictly against a landlord and that a tenant’s rights are not to be
cut down except by clear words.
In this regard
I was referred to the case of Cook v Shoesmith, a decision of the
Court of Appeal [1951] 1 KB 752. There a tenant agreed ‘not to sublet’, and the
court held that such an agreement was not broken by a subletting of part of the
premises because the words ‘to sublet’ must have an object and the only
possible object in that case was the house that was demised. So, thus
construed, the agreement fell within the well-established principle, set out in
the judgment of Somerville LJ at p 753, that an undertaking not to sublet or to
assign the premises is not broken by a sublease or assignment of part only of
them. In that case reference was made to the principle that the courts have
always held a strict hand over conditions for defeating leases as one of long
standing.
Turning to the
particular wording of this lease, for the plaintiff it was submitted that
clause 3(24) specifically refers only to ‘part’ of the premises. It would have
been a simple matter for the draftsman to have followed the common practice of
excluding assignment of the whole or any part of the premises or all or any
part of the premises, but that he has chosen not to do. As to context it was
submitted that from the manner in which the demised premises are described in
the list in the schedule to which I have referred it appears that the demised
premises were let in sections or parts. Further, that from the various
provisions I have mentioned, and in particular from clause 2(5) with its
reference to ‘the farm or any part thereof’, it is to be inferred that the
draftsman had a different purpose in mind when in clause 3(24) he used the
different language making up the phrase ‘any part of the premises’. It was said
that for many years it has been common practice for a prohibition against
assignment or underletting to be couched in some such form as ‘the premises or
any part thereof’ if the landlord intends to prohibit assignment or
underletting of the whole. Reference was made to the manner in which such
covenants are referred to in section 19(1) of the Landlord and Tenant Act 1927,
where the well-known provision there set out is expressed to apply to leases
containing a covenant, condition or agreement against
premises or any part thereof’. I was also shown two extracts from precedents in
the 1964 edition of the Encyclopaedia of Forms and Precedents where
covenants against assignment or underletting were couched in a like form.
In my judgment
the relevant words of the covenant in clause 3(24) are clear and unambiguous
and their meaning admits of no doubt. I agree with counsel for the defendant
that it after an assignment or underletting of the whole of the premises one
asked the question: has there been an assignment or underletting of any part of
the premises?, the answer plainly would be yes. The answer would be yes,
because what had been assigned or underlet would be every part of the premises
and this covenant against assignment or underletting of any part of the
premises in my view plainly embraces the assignment or underletting of every
part. As I see it, that is the beginning and end of this case.
However, in
deference to the arguments addressed to me I should deal with the further
points raised. For my part I do not think that such pointers as counsel’s
careful examination of each provision of this lease has produced materially
assist on the point of construction. In the phrases ‘the farm or any part
thereof’ in clause 2(5), ‘the said farmhouse and buildings and cottages or any
of them or any part thereof’ in the insurance provision in clause 4(2), and
‘the farm or any part thereof’ in the forfeiture provision in clause 5(5), part
means less than the whole. Against such assistance as the plaintiff may derive
from this can be set the use of the phrase appearing in clause 2(6), ‘any parts
of the farm’. Some arguments also centred on the meaning and effect of the
second limb of clause 3(24) itself. In that limb there is a prohibition against
persons other than the tenant and his staff residing in the farmhouse or
cottages ‘prior to any such assignment or underletting’. Such assignment or
underletting refers back to an assignment or underletting of any part of the
premises which, on the plaintiff’s argument, does not embrace an assignment or
underletting of the whole. Accordingly, for the defendant it was argued that
the plaintiff’s construction of the first limb of subclause (24) leads to an
absurd conclusion with regard to the second limb, namely, that the second limb
would operate to prevent any person other than the tenant and his staff
residing in the farmhouse and cottages even after there had been an
underletting of the whole of the premises. In answer the plaintiff submitted
that, as assignments or underlettings of the whole of the premises are
permitted and therefore stand outside the subclause altogether, so the
prohibition in the second limb would not apply to prevent an assignee or
subtenant of the whole taking up residence. I am not convinced that this answer
is sound, but I need not pursue this, because even if the plaintiff is correct
on this the only result is that the second limb of subclause (24) is of no
assistance to the defendant. Overall I do not myself think that these provisions
really take the matter any further in the light of what seems to me to be the
clear wording of the first limb of subclause (24).
Nor do I
derive any assistance from the manner in which the property was listed in the
schedule at the end of the lease. The form of the schedule is unexceptional for
an agricultural lease.
As to the
conclusion to be drawn from the failure to use a common form provision such as
‘the whole of the demised premises or any part thereof’ or ‘the demised
premises or any part thereof’, it seems to me that this failure provides a very
unsure guide indeed in a case such as this where the wording used is
unambiguous and where in practice various phrases are commonly used in
covenants against assignment and underletting. The purpose, I apprehend, of
including words such as ‘or any part thereof’ in such covenants is to ensure
that in conformity with well-settled principle the omission of those words does
not leave the tenant free to assign or sublet parts. But it does not follow
from this that if the draftsman uses the phrase ‘any part of the property’ he
is contemplating that there may be an assignment or underletting of the whole.
Had that been intended I would have expected the prohibition to be expressed as
applying to assignments or underlettings of ‘part only’ of the premises.
Finally, there
is some evidence before me that an assignment or underletting of the whole to a
single tenant is not attended by the same disadvantages to a landlord as an
assignment or underletting of part or parts only. That may be. But it would be
the purest speculation to suggest that that is what the original landlord in
this case had in mind. He might equally have had in mind a wish to have some
control over who was farming his land, a consideration as applicable to an
assignment or subletting of the whole as to an assignment or subletting of part
or parts only. I do not think this type of speculation assists.
Accordingly,
in my judgment, on its true construction clause 3(24) prohibits the plaintiff
from assigning or underletting the whole or any part of the premises in
question without the consent of the defendant landlord.