Zarvos v Pradhan and another

Appellant landlord opposing grant of new business tenancy on ground of intention to use premises for purpose of own business — Judge finding landlord having no reasonable prospect of setting up business — Whether judge erring in failing to make clear whether landlord none the less having genuine intention to start business — Section 30(1)(g) of Landlord and Tenant Act 1954 — Appeal dismissed The appellant landlord lived above restaurant premises that he had originally run, but which he had later let to the respondent tenants under a business tenancy. In 1999, the parties fell into dispute following a rent review. The matter was not resolved, and, in a letter sent in October 1999, the landlord purported to terminate the lease. In November 2000, the landlord gave notice that he would oppose an application for a new tenancy on the ground, under section 30(1)(g) of the Landlord and Tenant Act 1954, that he intended to occupy the premises for the purpose of carrying on his own business. That matter was tried as a preliminary issue. The judge directed himself that the landlord was obliged to show that he had both a genuine intention and a reasonable prospect of bringing it to fruition. He found, on the evidence, that the landlord did not genuinely intend to run a business because there was no reasonable prospect of bringing that about, owing to difficulties in raising the necessary finance. He therefore concluded that the landlord could not prove the section 30(1)(g) ground. The landlord appealed, contending that the judge had erred in his approach to section 30(1)(g), since he had not made it clear whether he was finding that the landlord had: (i) a genuine intention that he was unable to carry out; or (ii) no genuine intention. Held: The appeal was dismissed. It was not necessary to take a sequential approach to section 30(1)(g) and to decide the first limb, namely whether the landlord had a genuine intention to carry on business at the premises, before moving on to the second, that is, whether there was a reasonable prospect of his doing so. The judge had to decide the single question posed by section 30(1)(g): did the landlord, upon the termination of the tenancy, intend to occupy the premises for the purpose of carrying on a business? If the judge found that there was no such intention, the landlord would fall at the first fence, and it would not then be necessary to investigate the reality or fantasy of his plan. If the judge started with the second limb and found that the landlord had no reasonable prospect of setting up a business, it would not be necessary to investigate whether his intention to do so was genuine: Cunliffe v Goodman [1950] 2 KB 237 per Asquith LJ and Gregson v Cyril Lord Ltd [1963] 1 WLR 41 considered. The judge had been entitled to find, on the evidence, that the landlord did not have a reasonable prospect of raising the finance necessary to establish a business. That was the end of the matter, and, in view of his findings on that issue, the judge had not been obliged to make any finding on the first limb. Ivan Clarke (instructed by CP Christou) appeared for the appellant; Timothy Higginson (instructed by Mishcon de Reya) appeared for the respondents. Sally Dobson, barrister