Landlord and tenant — Secure tenancy — Whether appellant as employee of the respondents was required by his contract of employment to occupy a house for the better performance of his duties — Whether tenancy must be determined during a period of employment
1954 the appellant, Robert Griffiths, was appointed as caretaker for the
Howardian High School for Boys, Cardiff — He was allocated 132 Llanrumney
Avenue, a house not in the grounds of the school, but on a housing estate owned
by Cardiff County Borough Council, and instructed to hold the keys of the
school at his house — On November 14 1956 the council bought 38 Hampton Court
Road, Cardiff (‘the house’) in order to provide accommodation for the caretaker
of the school — The house was adjacent to the school and the appellant and his
wife moved into it at a rent of £1 per week, which rent was never thereafter
increased — By 1976 the respondent council had become the local education
authority and the employer of the appellant in place of Cardiff County Borough
Council, and pursuant to the Employment
conditions of service, which included that it be a condition of employment that
a caretaker must reside in school accommodation where such premises are available
and a tenancy agreement must be entered into — In 1990 it was decided that
Howardian High School should be closed — Because the appellant’s normal
retirement date at age 65 was on February 14 1990, he asked to be allowed to
stay on until the school closed at the end of the summer term; the plaintiffs
agreed
1990 the appellant was informed by the plaintiffs that the house was required
for a resident caretaker for a community education centre; a formal notice to
quit the house on or before July 20 1990 was enclosed — Because that notice was
ineffective a notice in appropriate form was served on August 7 1990 to expire
on September 7 — In the court below the judge concluded that the strong balance
of probabilities was in favour of a finding that there became implied in the
appellant’s contract of employment an implied term that he was required to
occupy the house purchased by the council in 1956 that he should be required to
live in the house for the better performance of his duties as a caretaker of
the adjacent school — Further, he held that the appellant’s tenancy did not
become a secure tenancy between his retirement from employment on July 20 1990
and the determination of the tenancy by the notice expiring on September 7 —
The appellant appealed
instrumental in persuading the council to acquire a house near to the school,
he was required to live in the house for the better performance of his duties
and the terms of the conditions of service of all caretakers provided support
for the judge’s conclusion as to what must have been the common intention of
the parties — The tenancy did not become a secure tenancy after the retirement
of the appellant — Parliament must have intended that the local authority
should be able to recover possession in ordinary circumstances — The continued
effect of the exception from security of tenure was not intended by Parliament
to depend upon the ending of the tenancy during the existence of the employment,
because no legislative purpose of such a rule can be discerned — If, when the
notice to quit is served or the tenancy brought to an end the occupation of a
dwelling-house by the tenant is still referable to his employment, and to the
requirement that he occupy the dwelling-house for the better performance of his
duties without any agreed or intended change in the nature and purposes of that
occupation, the tenancy is effectively terminated because it never becomes a
secure tenancy
The following
case is referred to in this report.
Crawley
Borough Council v Sawyer (1987) 86 LGR 629;
20 HLR 98, CA
This was an
appeal from a decision of Judge Francis in Cardiff County Court on February 25
1991, who had given judgment in favour of the plaintiffs, South Glamorgan
County Council, ordering that the defendant, Mr Robert Griffiths, give up
possession of 38 Hampton Court Road, Penylan, Cardiff.
Keith Bush
(instructed by Leo Abse & Cohen, of Cardiff) appeared for the appellant
defendant; Malcolm Bishop (instructed by the solicitor to the South Glamorgan
County Council) represented the respondent plaintiffs.
Giving
judgment, RALPH GIBSON LJ said: This is an appeal by the defendant, Mr
Robert Griffiths, from a decision given by Judge Francis in Cardiff County
Court on February 25 1991. By that decision the plaintiffs, South Glamorgan
County Council, recovered possession of a house, 38 Hampton Court Road,
Penylan, Cardiff, which the defendant and his wife had occupied as a tenant of
the council for many years. The defendant’s contention is that on the facts he
is entitled to a secure tenancy of the house under section 79(1) of the Housing
Act 1985. By a respondent’s notice the council contends that in addition to the
grounds relied upon by the judge there are other grounds upon which the court
should uphold the order for possession. For reasons which will become apparent,
it is not necessary for the court to consider those additional points. The main
issue is whether the defendant was both an employee of the plaintiffs and
required by his contract of employment to occupy the house for the better
performance of his duties. If he was so required, he had no defence to the
claim to possession.
The facts
found by the judge are as follows. In 1953 Cardiff was a county borough and the
local education authority for the area. The council advertised for a caretaker
for the Howardian High School for Boys, stating that accommodation would be
provided. The defendant applied for job and was appointed in January 1954. He
was allocated by the council 132 Llanrumney Avenue, a house not in the grounds
of the school, but on that housing estate owned by the council, which was
nearest to the school. The defendant was instructed to hold, and did hold, the
keys of the school at his house.
On November 14
1956 the council bought 38 Hampton Court Road, the house the subject of these
proceedings, in order to provide accommodation for the caretaker of the school.
The purchase was approved by the minister for that purpose. It was the house
adjacent to the school and nearest to it in a new development then being
carried out. The defendant and his wife moved into that house at a rent of £1
per week, and the rent has never since been increased.
By 1976 the
plaintiff council had become the local education authority and the employers of
the defendant in place of Cardiff City Council. Pursuant to the contracts of
Employment Act 1963 there was provided to the defendant a statement of his
duties and conditions of service. Para 6(a) of that substantial document said:
It shall be a
condition of employment that a caretaker must reside in school accommodation
where such premises are available and a tenancy agreement must be entered into.
The defendant
was not asked to enter into any formal tenancy agreement. It is conceded by the
defendant that the plaintiffs are the owners of the house and entitled to
possession subject to any right which he has to a secure tenancy.
In 1990 it was
decided that the Howardian High School, a mixed-comprehensive school formed
from the old High School for Boys and the Lady Margaret High School for Girls,
which were on contiguous sites, should be closed at the end of the summer term.
The defendant’s normal retirement date at age 65 was on February 14 1990. He
asked to be allowed to stay on until the school closed and the plaintiffs
agreed. The director of education by a letter of January 24 1990, in accepting
the plaintiffs’ proposal, wrote to the defendant in a letter which included the
following:
I will inform
all the relevant Departments of your continued service and will also write to
Cardiff City Housing Department giving them a revised date of when you will be
required to vacate the school house.
The
defendant’s answer did not dispute that on retirement he would have to move
out. He wrote:
I have been
given to understand that the County Council proposed to sell the house as
surplus to requirements. If this is so, may I please have the first option to
buy it.
On May 17 1990
the defendant was informed by the plaintiffs that the house, the defendant’s
home, was in fact required for a resident caretaker for a community education
centre to be provided in the school grounds and that the defendant would have
to get out on or before his retirement. A formal notice to quit the house on or
before July 20 1990 was enclosed. The notice to quit, drafted under a
misapprehension that the defendant was a service occupier and not a tenant, was
conceded by the plaintiffs to have been ineffective. A notice in appropriate
form was served on August 7 1990 to expire on September 7, and, if the
defendant fails in his contention that he had a secure tenancy, it is conceded
that the second notice was effective.
The community
education centre has been established and a caretaker for it has been
appointed. The plaintiffs intend to place that caretaker in occupation of this
house. The plaintiffs have made it clear that the defendant will be rehoused by
the council and would be entitled to the full ‘right-to-buy’ concession. I take
that from the notes of evidence made by the judge of the opening in the case
below.
As to the
decision of Judge Francis, after stating the facts as I have recited them in
summary form, he first stated the law to be applied. He said:
Section 79(1)
of the Housing Act 1985 provides that the tenancy of a dwelling-house in
respect of which the landlord and tenant conditions contained in sections 80
and 81 are satisfied (as they are accepted to be in this case) is a secure
tenancy. But section 79(2)(a) provides that the general provision is
subject to the exceptions in Schedule 1 to the Act and para 2(1) of that
Schedule provides that a tenancy is not a secure tenancy if the tenant is an
employee of the landlord and his contract of employment requires him to occupy
the dwelling-house for the better performance of his duties. It is common
ground that there was no such express term in the defendant’s contract of
employment with the plaintiffs, at least until he was issued with the detailed
statement of conditions of service in 1976. But it is also common ground that
such a term need not be an express term; it can arise by necessary implication
from the facts of the employee’s employment and of his occupancy. The central
issue of fact in this case is whether the plaintiffs have established on the
balance of probabilities, the burden of proof of this point being clearly upon
them, that the facts justify implying such a term in the defendant’s contract
of employment.
After reviewing
the evidence, the judge concluded that the strong balance of probabilities was
in favour of a finding that there became implied in the defendant’s contract of
employment an implied term that he was required to occupy the house purchased
by the council in 1956. He continued:
If after all
the statutory requirements had been complied with and the house acquired the
defendant had had a change of heart and had announced to the council that he
did not intend to move from Llanrumney after all, I do not believe that he
would have kept his job. If after they had been in the new house for a few
months the defendant and his wife had found that they could not settle in
Penylan and he had told the council that they intended to move again to a house
some distance from the school, I do not believe that he would have kept his
job. In short, once the council had acquired this house, even if the
acquisition was to some extent motivated or accelerated by the defendant’s
promptings, I find that on the balance of probabilities it became an implied
term in the defendant’s contract of employment that he should be required to
live in the house for the better performance of his duties as a caretaker of
the adjacent school. It follows that I hold that the defendant’s tenancy falls
within the exception set out in para 2(1) of Schedule 1 to the Act and was not
a secure tenancy within the meaning of section 79.
The judge then
addressed what he called the bold submission made by council for the defendant
to the effect that since (1) the defendant had retired from the plaintiffs’
employment on July 20 1990, and (2) his tenancy was not determined until
September 7 of that year by the second notice to quit, the accepting condition
in para 2(1) of Schedule I ceased to apply, and from the moment the defendant
ceased to be an employee of the plaintiffs the tenancy became a secure tenancy
because the necessary conditions in sections 80 and 81 were satisfied.
The judge
observed that if that submission were correct the result would be dramatic and extraordinary.
He rejected it. He held that a tenancy caught by the exception did not
automatically change its character at the moment of retirement by the tenant
from employment. Such a tenancy in his view remained the same tenancy, bearing
the same essential characteristics and capable of being validly determined in
the same way that it could be determined during the employment. He added:
. . . if the
landlord after that event indicates to the tenant that he is accepting him as
still his tenant despite the fact of retirement, or if the landlord continues
to accept rent from the retired tenant for a significant period without
anything being said, the law will infer the creation of a new tenancy. But
where, as in this case, the landlord has made it clear months in advance that
he will expect the tenant to vacate on retirement, and serves a notice to quit
less than three weeks after the retirement date when it becomes clear that the
tenant is not going to vacate voluntarily, that inference cannot arise.
Mr Bush, for
the appellant, has advanced two main grounds of appeal. The first was that the
judge was wrong on the evidence to hold that there was an implied term of the
defendant’s contract of employment, either at first with Cardiff City Council
or later with the plaintiffs, that he was required to reside at 38 Hampton
Court Road for the better performance of his duties as caretaker. If that is
right, the defendant must succeed. The second ground raised the point of law
which the judge rejected.
As to the
implying of the term, Mr Bush submitted that there was no proper factual basis
for the judge’s finding that, once Cardiff City Council had purchased the
house, the council would have terminated the defendant’s employment if he had
refused to reside in the house or if, having moved in, he had decided to move
out. The defendant’s evidence was to the effect that he had moved into the
house because he had chosen to do so and not because he was required to do so,
and it had been on his initiative in approaching the headmaster that the
acquisition of the house had been made by the education authority. Judge
Francis, in considering substantially the same submission below, commented on
the word ‘required’. He said:
To require
someone to do something normally connotes ordering that person to take an
action which he otherwise might well not have taken. It is a difficult concept
to apply to the situation in which both parties strongly desire the result
which one is requiring the other to achieve. The defendant wished to live
nearer his work; the council wanted their caretaker to be on the spot. I
suspect that this dilemma is by no means uncommon, because in many instances
the desirability of a job to an applicant is enhanced by the fact that there
goes with the job a house on the spot, in which he is to be ‘required’ to live.
He recited the
facts relevant to the acquisition of the house by the council.
I would refer
also, with reference to the facts, to the fact that in June 1977, when the
plaintiffs had become owners of the house in succession to the city council,
the terms and conditions of service of all caretakers included the term in para
6(a) to which reference has been made above. That paragraph referred to ‘school
accommodation’. This house was not in the school grounds, but it was owned by
the authority which ran the school and was close to the school grounds. It is
not necessary to decide any issue of construction. The presence of the term
provides, I think, support for the judge’s conclusion as to what must have been
the common intention of the parties. In my judgment there was a clear basis in
the evidence for the finding, and I respectfully think it was right.
As to the
point of law, Mr Bush’s submission concentrated upon the wording found in the
sections. Sections 70(1), 80(1) and 81 all refer in the present tense to a
state of fact. Thus in para 79:
(1) A tenancy under which a dwelling-house is let
as a separate dwelling is a secure tenancy at any time when the conditions
described in sections 80 and 81 . . . are satisfied . . .
The landlord
condition in section 80 is expressed as:
The landlord
condition is that the interest of the landlord belongs to one of the following
authorities . . .
And in section
81:
The tenant
condition is that the tenant is an individual and occupies the dwelling-house
as his only or principal home . . .
Thus the
quality of being a ‘secure tenancy’ depends, provided that it is of a
dwelling-house let as a separate dwelling, upon the existence of the stated
factual circumstances for example, the tenant condition that he occupies the
dwelling-house as his only or principal home depends upon what the tenant does
and intends, and that may change from time to time without alteration of the
terms of the tenancy and without the need for any agreement by the landlord.
Thus, as Parker LJ said in Crawley Borough Council v Sawyer (1987)
20 HLR 98 at p 100:
It would
therefore appear that a tenancy can at one time be a secure tenancy, cease to
be a secure tenancy, and become a secure tenancy again if in the interim period
it has not been determined.
That was with
reference to the occupation and intention of the tenant. It was therefore
submitted that para 2 of Schedule 1 is to be construed in the same way. It
says:
A tenancy is
not a secure tenancy if the tenant is an employee of the landlord or of — a
local authority . . . and his contract of employment requires him to occupy the
dwelling-house for the better performance of his duties.
Therefore,
since the ending of the defendant’s employment had no effect upon the tenancy
but merely brought to an end part of the factual circumstances necessary for
the continued existence of the exception, it was submitted that the tenancy
continued as a secure tenancy after the employment came to an end. The point
was well perceived and has been very well argued by Mr Bush. I have, however,
no doubt whatever that it cannot be accepted, because it would be clearly
contrary to what seems to me to be the intention of Parliament as set out in
the relevant parts of the statute. Section 79(1), which provides that a
dwelling-house which is let when the specified conditions are satisfied, is by
section 79(2) made:
. . . subject
to the exceptions in Schedule 1 (tenancies which are not secure tenancies). . .
The tenant of
such a tenancy is not to have security of tenure against the local authority,
which are to be free to recover possession. That right is not qualified by the
requirement of proof of reasonableness as are other grounds of possession set
out in Schedule 2 of the Act. Parliament must have intended that the local
authority should be able to recover possession under those provisions in
ordinary circumstances such as termination of employment by the employee or by
the local authority, whether with or without controversy, and upon the death of
the employee. The continued effect of the exception was not, I think, intended
by Parliament to depend upon the ending of the tenancy during the existence of
the employment, because no legislative purpose for such a rule can be discerned
as I am able to understand the statute.
Mr Bush
suggested that by suitable drafting devices in tenancy agreements the effect of
the construction for which he contended could be effectively met. Such
provisions would have the advantage, he submitted, of letting the tenant know
precisely how he was placed. He pointed to the fact that recourse might be had
to Ground 1 for possession in Schedule 2 or in some circumstances, not
including this particular case, under Ground 12, both of which of course are
qualified by the requirement of reasonableness.
In my
judgment, those suggestions do not persuade me that the legislative purpose was
other than that perceived by the judge and as I have explained above in this
judgment. If, when the notice to quit is served or the tenancy is brought to an
end the occupation of the dwelling-house by the tenant is still referable to
his employment, and to the requirement that he occupy the dwelling-house for
the better performance of his duties without any agreed or intended change in
the nature and purposes of that occupation, the tenancy is effectively
terminated because it never became a secure tenancy. It was submitted that this
would create much uncertainty. I do not think so. Local authorities, or other
landlords affected by these provisions, will be well advised to act promptly
because the court may well infer a change in the nature of the occupation after
any significant delay; but the local authority will retain the ability to act
fairly and with consideration without immediate loss of the right to recover
possession.
For these
reasons I would dismiss this appeal.
STUART-SMITH
LJ agreed and did not add anything.
Appeal
dismissed with costs. Application for leave to appeal to the House of Lords
refused.
