Landlord and tenant – Breach of covenant – Quantum of damages – Respondent holding assured shorthold tenancy – Appellant landlord demanding rent arrears and seeking possession of property – Respondent counterclaiming for damages for breach of implied repairing covenant – District judge dismissing claim and allowing counterclaim – Appellant appealing – Whether judge erring in awarding damages for disrepair for period prior to date of tenancy – Whether judge erring in assessment of damages – Appeal allowed in part
The respondent was the tenant of a property owned by the appellant, who brought a claim for possession for rent arrears on the basis that the premises were let to the respondent under an assured shorthold tenancy which began in 2007.
The respondent had moved into the property in about March 2005 and thereafter occupied the property with others and contributed to the rent. At that point, he was not the tenant named in the tenancy agreement, although he said that he had delivered the rent to the claimant’s agent every month.
The respondent accepted that he was in arrears but contended that the tenancy had begun in 2011 and been renewed in 2012. He counterclaimed for damages in respect of a breach of a repairing covenant.
The district judge dismissed the claim for possession and gave judgment on the counterclaim in favour of the respondent from 2007. An award of damages was increased by 10%, applying Simmons v Castle [2012] EWCA Civ 1039; [2012] EWCA Civ 1288; [2013] 1 WLR 1239.
The appellant appealed, contending, among others things, that the district judge awarded damages for an excessive period as the respondent had no claim for damages for the period between 2007 and 2011 when he was in occupation of the premises but not as a tenant. The obligation to repair in section 11 of the Landlord and Tenant Act 1985, implied into every applicable lease, was owed only to the tenant, not to a licensee.
The High Court dismissed that appeal but the appellant appealed to the Court of Appeal, contending that the judge erred in: (i) awarding damages for disrepair for a period of about four years prior to the date of the tenancy; and (ii) assessing the level of general damages for breach of a repairing covenant. The Housing Law Practitioners’ Association intervened.
Held: The appeal was allowed in part.
(1) Appellate courts had been repeatedly warned not to interfere with findings of fact by trial judges, unless compelled to do so. However, what happened in this case amounted to a serious procedural irregularity. The pleadings and the evidence clearly indicated that the respondent only became the tenant of the property under an assured shorthold tenancy in March 2011. At no point in either his pleadings or his written evidence did the respondent assert that he became a tenant in 2007.
The district judge would not have arrived at the conclusion he reached in his judgment had his attention been properly drawn to the pleadings and to the appellant’s statement, which clearly indicated that the respondent only became the tenant of the property in 2011 when he became entitled to the benefit of the term implied into the tenancy agreement by section 11 of the 1985 Act.
He was only entitled to damages for breach of the implied term from that date. The damages to which he was entitled were equal to 50% of the rent paid under the tenancy from 2011. The award of damages calculated by reference to a reduction in rent dating back to 2007 was therefore excessive: Fage UK Ltd v Chobani UL Ltd [2014] EWCA Civ 5 considered.
(2) The object of awarding damages against a landlord for breach of his covenant to repair was not to punish the landlord but, so far as money could, to restore the tenant to the position he would have been in had there been no breach.
There was no good reason why general damages for breach of a repairing covenant should be excluded from the 10% uplift authorised in Simmons v Castle, in which the Court of Appeal declared that, with effect from 1 April 2013, the proper level of general damages for pain, suffering and loss of amenity in respect of personal injury, nuisance, defamation and all other torts which caused suffering, inconvenience or distress to individuals, would be 10% higher than previously, unless the claimant fell within section 44(6) of the Legal Aid, Sentencing and Punishment of Offenders Act 2012.
The calculation of general damages for loss of amenity, of which discomfort, inconvenience and distress were the symptoms, was a matter for the judge, without expert valuation evidence. The facts of each case had to be looked at carefully to see what damage the tenant had suffered and how he might be fairly compensated by a monetary award: Calabar Properties Ltd v Stitcher [1983] 2 EGLR 46 considered.
(3) Damages were not invariably calculated by reference to a notional reduction in rent but might alternatively be expressed as a global award or a combination of the two. Even where the rental value was used as the basis for calculation, the particular circumstances of the tenant might lead to either an increase or a reduction in the quantification. The fact that taking a notional reduction in rent as the starting point might sometimes (though not invariably) incorporate an adjustment for inflation was no justification for excluding such damages from the scope of the uplift. In any event, it was not the case that claims for general damages for breach of repairing covenants had benefited fortuitously from the expansion of the declaration in Simmons v Castle: McCoy & Co v Clark (1982) 13 HLR 87 and Wallace v Manchester City Council [1998] 3 EGLR considered.
(4) In some types of claim, the level of damages was assessed by reference to a tariff to ensure consistency in awards and promote settlement of disputes, But there was nothing in Simmons v Castle to suggest that the declaration should be confined to cases where damages were assessed by reference to a tariff. The court could have confined it to such cases but conspicuously did not do so.
Claims for damages for breach of repairing covenant fell squarely within the primary purpose of Simmons v Castle, which was to compensate claimants for the success fee to be deducted from their damages.
Christopher Mann (instructed by Shuttari Paul and Co of Southall) appeared for the appellant; Toby Vanhegan and Matthew Lee (instructed by Duncan Lewis Solicitors of Manchester) appeared for the respondent; Liz Davies QC and Marina Sergides (instructed by Hodge Jones Allen LLP) appeared for the intervenor.
Eileen O’Grady, barrister
