Landlord providing flat for occupation by resident caretaker – Landlord seeking to charge tenants notional rent in respect of caretaker’s flat – Whether notional rent in respect of caretaker’s flat recoverable by way of service charge – Judge dismissing landlord’s claim – Appeal dismissed
The appellant was the leasehold owner of 27 Lennox Gardens, London. The building was divided into six residential flats, of which five were subject to long leases upon materially similar terms (the leases). The sixth was set apart for the use of a residential caretaker (the caretaker’s flat). The respondents were the lessees, who between them owned four out of the five leases. By clause 4(2)(i) of each of the leases, the lessees covenanted to bear a proportion of moneys expended by the lessor, under clause 5(4). By clause 5(4) the landlord covenanted to provide the services listed in schedule 4, one of which was the provision of “a resident housekeeper or porter”. Schedule 4 also provided, in para 8, that “the lessor shall provide a resident housekeeper or porter to perform the service specified in the sixth schedule hereto”. Paragraph 9 of schedule 4 provided for “gas, electricity, telephone, general and water rates, and internal maintenance repairs of the flat occupied by the resident housekeeper or porter”.
Subsequently, the appellant sought to charge the respondents a notional rent of £150 per week for 1994/5 in respect of the caretaker’s flat. The sum was equal to the agreed figure that the landlord could reasonably have obtained from letting the caretaker’s flat on the open market.
The respondents issued county court proceedings claiming that upon the true construction of their leases, the landlord was not entitled to claim such notional rent. The judge granted the declaration. The landlord appealed contending, inter alia, that a notional rent in respect of the caretaker’s flat was recoverable, by way of a service charge, pursuant to paras 8 and 9 of schedule 4 to the leases.
Held: The appeal was dismissed.
The issue was whether the notional rent in respect of the caretaker’s flat, which had been foregone by the landlord, could be described as “moneys expended” within clause 4(2)(i) of each of the tenants’ leases. The terms of paras 8 and 9 of schedule 4 did not conclude the matter in the landlord’s favour. Where a landlord seeks to recover money from a tenant, there must be clear terms in the lease which entitled him to do so. There were no provisions in the leases for the calculation of any notional rent. Furthermore, there had been no attempt to recover the notional rent by way of service charge until 1994/5. It could not be said that a reasonable tenant reading the leases would have perceived that para 4(2)(i) obliged him to contribute to the notional costs incurred by the landlord incurred in providing a caretaker with the flat. Accordingly, the judge’s decision was to be upheld.
Charles Holbech (instructed by Ellistons) appeared for the appellant; Timothy Dutton (instructed Nicholson Graham & Jones) appeared for the respondents.
Thomas Elliot, barrister
