Company occupying two London flats – Flats used to provide accomodation for employees working abroad on visits to London – Council serving notices alleging breach of condition – Whether use of premises for temporary sleeping accommodation constituting breach of condition – Whether accommodation provided for a consideration arising by reason of occupants’ employment – Judge quashing notices – Court of Appeal dismissing appeal
Lawrie Plantation Services (LPS), one of a group of companies with extensive overseas interests, owned two leasehold flats in Chelsea. Planning permission granted in 1987 for the conversion of the flats imposed a condition prohibiting use for any purpose specified in section 25 of the Greater London Council (General Powers) Act 1973, under which the use of residential premises as temporary sleeping accommodation involved a material change in use of the premises. Such use was defined in section 25(2)(a) to include, inter alia, occupation by the same person for less than 90 consecutive nights for a “consideration arising . . . by reason of the employment of the occupant”. Between 1994 and 1995 LPS made a total of 224 rent-free “allocations”, each for a stay of between seven and 14 days, to three classes of occupant: (a) employees of associated companies on holiday visits to London, (b) employees of the applicant for social purposes, and (c) friends and directors of the applicant. In July 1996 the Kensington and Chelsea Royal London Borough Council, served breach of condition notices under section 187A of the Town and Country Planning Act 1990 alleging that the use of the flats as sleeping accomodation for occupation by employees of LPS for less than 90 days breached condition 11 of the planning consent. LPS contended successfully that the council had acted beyond their powers in issuing the notices and the judge ordered that the notice be quashed. The council appealed contending, inter alia, that the accomodation had been provided for a consideration arising by reason of the employment of the occupier since the premises were only offered to the employees in question as a result of their status as employees of LPS.
Held The appeal was dismissed.
The wording of section 25(2)(a) was eccentric and its effect unprincipled. Before a case could fall within section 25(2)(a)(I), the first limb, the provider of accomodation had to provide it by way of trade. If there was no trade, the first limb did not apply, even though the provision of accomodation was objectionable on planning grounds.The words ” by reason of the employment of the occupant” appeared to have been taken from income tax legislation treating the value of benefits in kind provided by an employer as part of the employee’s emoluments. The words “a consideration arising by reason of the employment of the occupant” meant that the provider of accomodation must receive a consideration from the occupant for providing it. “Consideration” in section 25 (2)(a)(i) meant consideration in its legal sense (see per Lush J in Currie v Misa (1875) LR 10 Ex 153) and was to be given the same meaning in (ii). On the evidence before the judge, there had had been nothing which could be called consideration in its correct legal sense. Therefore the council had not established that the two flats owned by LPS were used as sleeping accomodation provided “for a consideration arising by reason of the employment of the occupant” within section 25(2)(a)(ii).
Mark Lowe QC (instructed by the solicitor to Kensington and Chelsea Royal London Borough Council) appeared for the appellants; Alun Alesbury (instructed by Travers Smith Braithwaite) appeared for the respondent.
