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Legal notes: Much ado in Pantoland

Dave, the Pantomime Dame, was depressed. Every year, as the festive season approached, he would be called on yet again to don a frizzy wig, false eyelashes and a frock with a daring décolletage to help some of the nation’s favourite characters solve their problems.

Each pantomime brought its own unique trials: from having to rescue Jack after he has wasted all of the family’s savings on a gigantic beanstalk, to being the butt of everyone’s jokes as Mother Goose.

And while it’s all happy endings and cheers for the thigh-slapping principal boy, no one ever gave more than a fleeting thought to the fate of the one character common to most, if not all, pantomimes – and 2017 had seen our poor dame suffer an awful run of legal bad luck.

Dave’s trials and tribulations started back in January, when he set up a talent management business specialising in pantomime dames. Using his extensive contacts in the industry, he hoped that he would soon be earning the sort of money that would make Aladdin blush.

But Dave was a simple and honest sort, who thought that the words used in contracts should be given their ordinary meaning. And his agreements seemed to be with people who were more dishonest than the Forty Thieves and who hired smarter – and more devious – lawyers than he did.

Contractual interpretation

Dave’s business partners and their legal sharks had relied on a number of decisions of the House of Lords and Supreme Court, stretching back to Investors Compensation Scheme v West Bromwich Building Society [1997] UKHL 28 to argue that words in their contracts should be given interpretations that were at odds with the meanings ordinarily ascribed to them. This had left him out of pocket.

But Jenny from wardrobe, who was working in the theatre to help pay for her legal studies, mentioned some recent decisions which offered a glimmer of hope.

Persimmon Homes Ltd and others v Ove Arup & Partners Ltd and another [2017] EWCA Civ 373; [2017] PLSCS 112 suggested that judges were increasingly adopting a more literal approach to contractual interpretation – an impression bolstered by a lecture given by Supreme Court justice, Lord Sumption, in which he robustly criticised the approach to contractual interpretation in cases since Investors Compensation Scheme.

Given that he has several appeals listed for 2018, Dave hoped that Lord Sumption’s suggestion that “the parties are the masters of their own agreement, and anything which marginalises the role of words… is a direct assault on their autonomy” would carry the day.

Negligence

It was not just Dave’s contracts that had caused problems. A number of friends had provided help, for free, on which he had relied. Sadly, they had let him down and Dave thought they had been negligent. He did not feel happy about suing friends, especially as he had not paid them anything, but Jenny told him about the Court of Appeal’s judgment in Burgess v Lejonvarn [2017] EWCA Civ 254; [2017] PLSCS 87, which confirmed that, if he had relied on professional advice that had caused him loss, he could sue in tort for negligence.

And then there was the professional advice, for which Dave had paid before buying Hardup Hall earlier this year. His lawyers had failed to report to him on the results of their searches and enquiries as fully as they should have done. Had they done so, he would have asked questions about a prospective development nearby – and would have withdrawn from the purchase after discovering that Ali Baba had obtained planning permission to supersize a small convenience shop at the end of the road and convert it into a large emporium.

However, having bought the property, Dave would now have to rely on Orientfield Holdings Ltd v Bird & Bird LLP [2017] EWCA Civ 348; [2017] EGLR 26 to claim against his solicitors in negligence.

Residential tenancies

Meanwhile, Dave’s friend, Dick, was looking for a home for himself and his cat. He had seen a building with a flat on the first floor and a shop underneath. Jenny suggested that, despite its appearance, the building may be a “house” and that, if he bought the lease, he could also buy the whole building. It might be Christmas, but could this be true? It seemed so, thanks to Grosvenor (Mayfair) Estate v Merix International Ventures Ltd [2017] EWCA Civ 190; [2017] EGLR 25, which concerned a large property in London that, over the years, had been put to both commercial and residential uses. Even so, the Court of Appeal decided that the building could still be called a house and that the leaseholder could acquire the freehold under the Leasehold Reform Act 1967.

Another friend, the ever-youthful Peter, had found a flat on the second floor of a building which he wanted to rent. But he was worried that there was no rail on the stairs. What would happen if he, or a visitor, were to trip, fall and suffer injuries? Would the landlord have to pay compensation? The tragic case of Dodd (widow and executrix of Paul Dodd) v Raebarn Estates Ltd and others [2017] EWCA Civ 439; [2017] EGLR 32 confirmed that the fact that premises are unsafe does not, of itself, impose liabilities on a landlord. So unless Peter could persuade the landlord to fit a hand rail, he would be well-advised to say “never, never” to the flat and look elsewhere for accommodation. 

Management and service charges

Alice was lucky enough to own a flat already and she and the other owners in the building wanted to take over management from their landlord, Cruella de Vil plc. But if they were to “trip up” in some way during the process, the landlord might be able to defeat their claim. Fortunately, Jenny referred them to Elim Court RTM Co Ltd v Avon Freeholds Ltd [2017] EWCA Civ 89; [2017] PLSCS 46, a landmark decision in which the Court of Appeal ruled that mistakes in the documentation will not necessarily invalidate a claim. Even so, Alice and her neighbours would need experienced advisers to guide them because, as Lord Justice Lewison remarked in Elim: “It is a melancholy fact that whenever parliament lays down a detailed procedure for exercising a statutory right, people get the procedure wrong.”

Another member of their circle, Cinderella, was facing a huge service charge bill and the landlord was refusing to reduce its charges, even though it had received a grant for the works. However, in Oliver v Sheffield City Council [2017] EWCA Civ 225; [2017] PLSCS 83, the Court of Appeal decided that a landlord (a local authority in that case) should have given the leaseholder credit for a grant it had received. Dave hoped that this would lead to some good news for Cinders, in the form of a substantially reduced bill this Christmas.

Business tenancies

The theatre company also had pressing concerns. The owner of the theatre had just served a section 25 notice on the company opposing the renewal of its business lease on ground (f) (demolition or reconstruction).

Careful examination of the landlord’s plans suggested that it had worked up a scheme that would render the premises unusable in order to satisfy ground (f) and recover possession from the theatre company at the end of the lease.

But things looked bleak in the light of the High Court’s decision in S Franses Ltd v The Cavendish Hotel (London) Limited [2017] EWHC 1670 (QB); [2017] PLSCS 145 that a landlord’s motives for undertaking work are irrelevant. However, it was possible that the Supreme Court might yet agree to hear a “leapfrog” appeal next year – and the theatre company’s lease still had time to run. So the show must – and would – go on.

Easements

This year’s pantomime, Aladdin, was full of songs, gags and slapstick comedy, despite striking similarities between some parts of the plot and the law reports that Jenny had been reading so assiduously. Take, for example, Regency Villas Title Ltd v Diamond Resorts (Europe) Ltd [2017] EWCA Civ 238; [2017] EGLR 24.

Was it just a coincidence that the palace that housed Aladdin’s princess was surrounded by magnificent grounds and leisure facilities? They had once belonged to the Grand Vizier, Ottoman, and the occupants of the palace had used them freely for many years.

No one knew quite how wicked old Abanazar had acquired them from Ottoman. But he had, and he was now demanding payment for use of the facilities, even though the occupants of the palace had reason to believe that they had acquired legal easements over the land.

Fraud

There were also plenty of opportunities for audience participation. Dave, in his role as Widow Twankey, particularly enjoyed the scene at the Pantoland Registry in which a merchant was applying to register his purchase of the Wishee Washee Laundromat. Alerted by loud boos from the audience, Registry staff smelled a rat and discovered that the transfer has been signed by an imposter.

As a result, they refused to alter the register, leaving the merchant’s lawyers to cover his losses (as in Dreamvar (UK) Ltd v Mischon de Reya [2016] EWHC 3316 (Ch)) even though they had done nothing wrong and had no duty to check the seller’s identity.

However, all’s well that ends well in Pantoland. So, if you have not done so already, book your seats, join in at all the right times, and enjoy the Christmas festivities.

Allyson Colby is a property law consultant, James Driscoll is a is a solicitor and a writer and Stuart Pemble is a partner at Mills & Reeve.

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