Landau and another v Sloane ; Migdalski v Corvin

Rent Act 1977, section 12 and Schedule 2–‘Resident landlord’ provisions by which certain tenancies are excluded from full protection and have the status of restricted contracts–Position following death of resident landlord and vesting of landlord’s interest in personal representatives–Notices to quit served on tenants during 12 months ‘disregard’ period allowed by paragraph 1(c) of Schedule 2–Notices expiring before end of 12 months and no new landlord in residence by that time–Whether tenants became statutory tenants enjoying full Rent Act protection at end of 12 months or, as landlords contended, were liable to eviction, having become trespassers on expiry of notices to quit–Purpose of ‘disregard’ provisions in Schedule 2 analysed and explained by court–Position of tenants at end of 12 months dependent on various circumstances including whether there was by then a new landlord in residence–Comments on the ‘difficulties and obscurities’ of ‘this still imperfect statute’–Landlords’ submissions rejected and tenants held to have become statutory tenants–County court judges’ decisions reversed These were two appeals raising the same question. In the first Louisa Sloane appealed against a decision of Judge Leslie at Bloomsbury and Marylebone County Court in favour of Fay Lilian Landau and Peter Michael Neumann in an action for possession. In the second Mrs Mieczyslawa Corvin appealed against a decision of Judge Tumin at West London County Court in favour of Mrs Teresa Migdalski in a similar action. Both cases raised issues as to the construction of the Rent Act 1977, section 12 and Schedule 2, in its application to the circumstances following the death of a resident landlord. In the first appeal A Arden (instructed by J Crosthwait, of West Hampstead Law Centre) appeared on behalf of the appellant; Paul Morgan (instructed by Fay L Berman, of Brighton) represented the respondents. In the second appeal J King (instructed by Myers, Ebner & Deaner) appeared on behalf of the appellant; J L Powell (instructed by Lewis & Dick) represented the respondent. Giving the first judgment at the invitation of Stephenson LJ TEMPLEMAN LJ said: These are two appeals, the first against a decision of His Honour Judge Leslie, given in the Bloomsbury and Marylebone County Court on November 7 1979 in an action between Fay Lilian Landau and Peter Michael Neumann, plaintiffs, and Louisa Sloane, defendant; and the second against a decision of His Honour Judge Tumin, given in the West London County Court on October 31 1979, in an action between Mrs Migdalski, plaintiff, and Mrs Corvin, defendant. Each appeal raises the same question of construction of the Rent Act 1977. The result of both appeals must be the same and for the sake of simplicity I confine my narrative of the relevant events to the appeal from His Honour Judge Leslie. The question is whether in certain circumstances a non-resident landlord who serves a notice to quit can obtain possession of a dwelling-house originally let by a resident landlord. On March 4 1978 a Miss Newman let rooms on the ground floor of the building, 35 Lyncroft Gardens, London NW6, to Mrs Sloane on a weekly tenancy at a rent of £10 a week payable in advance. Miss Newman herself, who was the landlord, resided at that time and continued to reside thereafter on the first floor of another part of the building, 35 Lyncroft Gardens. Miss Newman died on August 11 1978, still in possession of the first floor, and her interest in the whole building, including her reversionary interest in the premises let to Mrs Sloane, vested in her personal representatives, who are the plaintiff respondents in this court. On December 17 1978 the personal representatives gave notice to quit to Mrs Sloane. The period of notice was extended by the rent tribunal but ultimately expired on July 4 1979. Neither the personal representatives nor any person claiming under or through the personal representatives resided in the relevant building before the first anniversary of the death of Miss Newman on August 11 1978. The tenant claims that she became a statutory tenant on that first anniversary, namely August 11 1979. The learned judge held that the tenant was not protected by the Rent Act and made an order for possession. The tenant appeals to this court. Section 1 of the Rent Act 1977 provides: Subject to this Part of this Act, a tenancy under which a dwelling-house (which may be a house or part of a house) is let as a separate dwelling is a protected tenancy for the purposes of this Act. The ground-floor rooms of 35 Lyncroft Gardens were so let to the tenant, Mrs Sloane. Section 2 (1) provides: Subject to this Part of this Act– (a)  after the termination of a protected tenancy of a dwelling-house the person who, immediately before that termination, was the protected tenant of the dwelling-house shall, if and so long as he occupies the dwelling-house as his residence, be the statutory tenant of it; If Mrs Sloane was a protected tenant, then on the expiration of the notice to quit she became a statutory tenant. That, however, as I have said, is subject to Part I of the Act and included in Part I is section 12. Subsection (1) of section 12 provides, so far as material: . . . a tenancy of a dwelling-house granted on or after August 14 1974 shall not be a protected tenancy at any time if– (a)  the dwelling-house forms part only of a building. . . (and this one did). (b)  the tenancy was granted by a person who, at the time that he granted it, occupied as his residence another dwelling-house which also forms part of that building; (and Miss Newman did) (c)  subject to paragraph 1 of Schedule 2 to this Act, at all times since the tenancy was granted the interest of the landlord under the tenancy has belonged to a person who, at the time he owned that interest, occupied as his residence another dwelling-house which also formed part of that building. 80 Mrs Sloane’s tenancy was granted by a resident landlord and so long as the original resident landlord, Miss Newman, was alive the tenant was not protected, but on the death of Miss Newman there immediately ceased to be a resident landlord, so that pursuant to condition (c) in section 12 the tenancy of the tenant became protected unless paragraph 1 of Schedule 2 otherwise provides. Before turning to that paragraph I add that by section 12(4) the whole of Schedule 2 is expressed to have effect for the purpose of supplementing section 12. Where a resident landlord sells his interest or dies there must in many, if not most cases, as in the present case, be some lapse of time before the vendor or the deceased resident landlord can be replaced by a new resident landlord and it is not surprising that paragraph 1 of Schedule 2 is apt to provide for these eventualities and to provide a transitional period which enables a new landlord to take up residence. Thus paragraph 1 of Schedule 2 provides: In determining whether the condition in section 12(1)(c) of this Act [that is the condition of continuous residence by landlords] is at any time fulfilled with respect to a tenancy [certain periods] shall be disregarded. In the case, for example, of a purchaser from a vendor landlord there must be disregarded the first 14 days of the purchaser’s ownership and if during that period of 14 days the purchaser notifies the tenant in writing that the purchaser intends to become a resident landlord, and if within the first six months of his ownership the purchaser does become a resident landlord, then the period during which there was, in fact, no resident landlord, between the date when the vendor moved out and the purchaser moved in, must be disregarded. Paragraph 1 also provides, for example, that when a resident landlord dies there must be disregarded any period of not more than 12 months beginning with the death of the deceased resident landlord during which the personal representatives of the deceased resident landlord hold the property and are non-resident landlords. Hence the importance in the narrative which I have set out of the first anniversary of the death of the deceased resident landlord, Miss Newman. The year expired. At the end of the year there was no resident landlord because the personal representatives had not moved in and neither had they assented or sold to a beneficiary or a purchaser who moved in and therefore, says the tenant to the landlords, ‘your time is up; you were given a year during which you could leave the property without a resident landlord; that year expired, you never did replace the resident landlord, Miss Newman, by another resident landlord and accordingly I am protected; and as you have given a notice to quit I am now a statutory tenant.’ In my judgment it seems clear that paragraph 1 of Schedule 2 was intended to allow a purchaser six months and personal representatives 12 months in which to provide a resident landlord in succession to a resident vendor or resident deceased landlord, and at the end of the disregard period the tenant is protected by the Rent Act unless there is then a resident landlord. Paragraph 1 by itself would not prevent a purchaser who was not a resident landlord from serving a notice to quit and obtaining possession from the tenant during the six months’ disregard period which follows the sale of the property, because all paragraph 1 says is that the period is to be disregarded in seeing whether section 12(1)(c) is satisfied or not. Similarly, paragraph 1 by itself would not prevent personal representatives who were not resident landlords from serving a notice to quit and obtaining possession from the tenant during the 12 months’ disregard period which follows the death of the resident landlord, because again all that the Schedule provides is that the period of disregard shall be disregarded in ascertaining whether there has been a break in continuity which, pursuant to section 12(1)(c), would bring the operation of section 12(1) to an end. To prevent this possibility, namely of a non-resident landlord being able to obtain possession during the period of disregard, Parliament has expressly provided. Paragraph 3 of Schedule 2 prevents possession being obtained in these circumstances by providing that during any disregard period ‘no order shall be made for possession of the dwelling-house subject to that tenancy, other than an order which might be made if that tenancy were or, as the case may be, had been a regulated tenancy.’  Thus, in my judgment, the landlord is held up during the disregard period. At the end of the disregard period if there is a resident landlord the tenant ceases to enjoy the security of a regulated tenancy which was given to him for the disregard period by paragraph 3 and he again becomes an unprotected tenant pursuant to section 12. If there is no resident landlord, at the end of the disregard period the tenant becomes a protected tenant if his contractual tenancy has never been determined. If notice to quit has been served and has expired, then he becomes a statutory tenant. Thus the tenant is protected against every one except against a resident landlord who can show a continuous chain of resident landlords broken only by any relevant disregard period. On behalf of the present landlords, it is urged, and the learned judge accepted, that a non-resident landlord can obtain possession in certain circumstances. It is said that if a non-resident landlord serves a notice to quit which expires during the disregard period he can obtain an order for possession when that period has expired. The argument, put shortly, is that the expiration of the notice to quit puts an end to the common law tenancy. Thereafter and until the end of the disregard period the tenant is a trespasser despite paragraph 3 of Schedule 2. As a trespasser he cannot be a protected tenant and unless he becomes a protected tenant he can never become a statutory tenant. Therefore he remains a trespasser and can be evicted by a non-resident landlord after the disregard period has expired. I do not accept this argument. Section 12 suspends the Rent Act security of tenure of a tenant so long only as there is a continuous resident landlord ignoring, pursuant to Schedule 2, any break in continuity caused by a disregard period. At the end of the disregard period the security of the tenant depends upon the qualifications of the landlord at that time. If the landlord is a resident landlord and no notice to quit has become effective then the tenant is a contractual tenant. If the landlord is a resident landlord and notice to quit has expired, the tenant is holding over after the determination of a contractual tenancy. If the landlord is not a resident landlord and no notice to quit has become effective, the tenant is a protected tenant. If the landlord is not a resident landlord and notice to quit has become effective, the tenant is a statutory tenant. In my judgment these results follow from section 12 of and Schedule 2 to the Rent Act 1977. The real criticism levied by the landlords in the present case was to the effect that nowhere does Schedule 2 spell out the position of a tenant; and the answer to that is quite simple. There were, as I have indicated, a number of possible results. They depend on the position at the end of the period of disregard. They depend, for example, on whether the tenant himself is still in occupation. They depend on whether the landlord at the end of the period of disregard is a resident or a non-resident landlord. They also depend on whether the landlord, whether he be resident or not, has or has not given a notice to quit and they depend on whether the notice to quit has or has not expired. It is perfectly true that Parliament has not made an exhaustive list of all the possibilities and said expressly what is to happen if each possibility comes into force, but in my judgment it is quite plain from the Act that one does await the eventuality and if there is no resident landlord at the end of the disregard period then the tenant is protected by the Rent Act. Section 12 created an exception to Rent Act security. By that exception resident landlords could let part of their house and recover possession of that part if, and only if, they remained resident landlords themselves. A resident landlord was thus encouraged to let without fear of the consequences so long only as he remained a resident landlord. Successors in title of a resident landlord, whether by purchase, inheritance, or by any other method, were given an opportunity to be in no worse position than the original resident landlord, but they were not elevated into a better position. Schedule 2 did not create a favoured class of non-resident landlords including purchasers and personal representatives. The argument for the landlords produces irrational and capricious results which I decline to put into operation. For example, a purchaser who omits for 14 days to give notice cannot evict the tenant even if the purchaser takes up residence. On the other hand a purchaser who gives notice of intention to reside within 14 days but genuinely changes his mind during the six-month period can evict the tenant at the end of the disregard period, if the landlord’s argument is correct, even though the purchaser never takes up residence. A non-resident purchaser may evict a tenant after six months; a non-resident personal representative may evict a tenant only after 12 months; in each case if notice to quit has been served and has expired before the end of the disregard period. A tenant, under section 12, is entitled to refer his contract of tenancy to a rent tribunal under sections 20, 77 and 80 of the Rent Act 1977. If the tenant refers his contract to a rent tribunal before a purchaser landlord serves notice to quit, then the tenant must become a statutory tenant against a non-resident landlord by section 103 unless the rent tribunal can be prevailed upon to shorten the notice to quit so that it expires before the end of the disregard period. If the tenant refers his contract to the rent tribunal before service of the notice to quit then the rent tribunal may, by section 104, extend the period of notice. Thus, if the landlords are right, under sections 103 and 104, in the one case by shortening the notice to quit and in the other case by lengthening a notice to quit, the rent tribunal has the most terrible power to exercise in relation to landlord and tenant that one could devise. If the notice to quit is limited or extended beyond the disregard period, then by paragraph 7 Schedule 2 it is conceded the tenancy does become a statutory tenancy at the end of the disregard period. If the notice is shortened or is not extended, as the case may be, then according to the argument of the landlords in the present case, the tenant becomes a trespasser at the end of the notice to quit. He remains a trespasser until the end of the disregard period and it is as a trespasser that he is then evicted by an order of the court. It is inconceivable that Parliament intended that the rent tribunal should be given this power to decide between whether a tenant should be or become a trespasser or should be or become a statutory tenant with all the privileges and status of irremovability of a statutory tenant. The requirement that a purchasing landlord must give 14 days’ notice of intention to reside points inexorably in aid of the true construction of section 12 and Schedule 2, namely that a landlord must be a resident landlord if the tenant is to remain without the security of tenure afforded by the Rent Act. Paragraph 3 of Schedule 2 does not make sense if a non-resident landlord may obtain possession after the end of a disregard period. The periods of six and 12 months from the date of purchase or the date of death are irrelevant to the position of a tenant who only has to know whether he must get out or not. They are explicable only if Parliament in its tenderness considers that a purchaser needed a maximum of six months in which to take up residence while with more tenderness Parliament opined that a personal representative might need 12 months in order to administer the estate and pass on the property to a beneficiary or purchaser, or some other person who might wish to become a resident landlord in his turn. In short, the disregard periods were provided to enable new landlords to qualify as resident landlords if they wished to do so. The disregard periods were not intended to provide, and do not provide, non-resident purchasers and personal representatives with opportunities of different length to obtain the benefit of the value of vacant possession. Paragraph 3 of Schedule 12 itself speaks with the language of a tenancy which appears to continue in existence during the whole of the disregard period and treats the tenant as a residential occupier with the security of tenure of a regulated tenancy which will cease if the landlord is a residential landlord at the end of the disregard period, or be converted into a statutory tenancy if the landlord is not a resident landlord at the end of the disregard period. As I have indicated, the involved language of paragraph 3 and the failure to spell out in words of one syllable the effect of section 12 of the Schedule on several occasions is due to the fact that there are so many different circumstances to envisage, depending on whether a notice to quit is served or not, depending on the position of the tenant, and depending on the position of the landlord at the end of the disregard period. On behalf of the landlords it was argued that if the common law provisions with regard to trespassers are allied with the provisions of the Act, it appears that Parliament has not provided for a tenant to be protected from a non-resident landlord who gives notice to quit which expires during the disregard period. I do not accept this method of approach. Paragraph 3 is only consistent with the tenant being protected before the period of disregard, during the period of disregard and after the period of disregard, save against a resident landlord. We were referred to a number of provisions of the Rent Act 1977, some of which were culled from previous Rent Acts existing or brought into existence over a period which spans more than half a century. Schedule 2 to the Rent Act 1977 and section 12 first saw the light of day in 1974 and speaking for myself I do not obtain any assistance from any of the other provisions of the 1977 Act, which, as I have said, have a different history and a different purpose. Nor do I obtain any assistance from the authorities which were cited and which were not directed to the many situations which may arise under section 12 and Schedule 2, situations under which a tenant will not know until the end of the disregard period whether he is a contractual tenant or a protected tenant, or a statutory tenant on that date. I am satisfied that section 12 and Schedule 2 do not have the effect for which the landlords contend and I would allow the appeals accordingly. Agreeing, BRIDGE LJ said: The arguments for the landlords, which prevailed in both these cases in the county court and which have been so skilfully deployed in this court, are formidable. So long as the conditions laid down in section 12(1) of the Rent Act 1977 in relation to a tenancy are satisfied, that tenancy is not a protected tenancy. The condition stipulated by section 12(1)(c) is satisfied both during the landlord’s actual residence and during any period required to be disregarded by paragraph 1 of Schedule 2. Accordingly, if the contractual tenancy is terminated during any such period, no statutory tenancy arises, since by definition a statutory tenancy can arise only on the termination of a protected tenancy or on succession to a previous statutory tenancy; see section 2(1). Paragraphs 6 and 7 of Schedule 2 contemplate and provide for a tenancy which is unprotected by virtue of section 12 becoming a protected tenancy. These provisions presuppose the continued existence of a contractual tenancy at the time when the condition stipulated by section 12 subsection (1)(c) ceases to be satisfied. There is no provision in Schedule 2 analogous to that found in paragraph 7 of Schedule 24 to the effect that a person in the position of either of the present appellants, whose contractual tenancy has been terminated during a period to be disregarded under paragraph 1 of Schedule 2, and who retains possession at the expiry of that period, his new landlord not having taken up residence, shall be deemed to hold as a statutory tenant under a regulated tenancy. I am fully sensible of the force of these considerations and if it were not for the provisions of paragraph 3 of Schedule 2 they would lead unanswerably to the conclusion for which the landlords contend, but it seems to me essential to consider81 first what is the purpose underlying that paragraph and, if the purpose emerges clearly, to consider secondly whether the statute can be construed to give effect to that purpose without doing violence to its language. As to the first of these questions the purpose of paragraph 3 is, in my judgment, unmistakable. It is to provide that on the transmission of the resident landlord’s interest, either inter vivos or upon death, there should be a standstill or ‘wait and see’ period during which the new landlord has the option either to take up residence and retain the rights of a resident landlord as against the tenant or to accept the tenant on the terms of a regulated tenancy. This is most clearly demonstrated by considering the operation of paragraph 3 on a transmission of the resident landlord’s interest inter vivos in the light of the provisions of paragraph 1 (a) and (b) of Schedule 2. In this case, unless the new landlord gives notice within 14 days of his intention to take up residence, the standstill period will be only 14 days. There will be no time for the new landlord to determine the tenancy within that period and on the expiry of that period the tenancy will become protected. It is rightly conceded by both Mr Morgan and Mr Powell that a notice of intention to occupy under paragraph 1(b) will attract the extended period of six months there mentioned only if the intention to occupy is bona fide. In the light of this it is surely inconceivable that a subsequent change of mind on the part of a new landlord is intended to give him the opportunity of preventing the tenant acquiring a regulated tenancy by giving a notice to quit to expire during the six-month period. No plausible alternative theory of the purpose of paragraph 3 has been advanced in argument. There can be no sense in giving to the tenant on the cesser of his former resident landlord’s interest, a purely temporary status of irremovability of six months in the case of a transfer inter vivos and 12 months in the case of death, unless his status at the end of the period is intended to depend on whether or not before the expiry of the period the new landlord has taken up residence. The differential between the two periods is explicable by reference to the longer time needed in the case of death to arrange for the future disposition and use of the landlord’s interest, but is not explicable on any other basis. Moreover, if the status of the tenant whose contractual tenancy survives the cesser of the resident landlord’s interest is dependent not on whether the new landlord becomes resident but merely on whether his contractual tenancy survives the standstill period under paragraph 1, the statute will, in my judgment, operate most capriciously. The ability of the contractual tenancy to survive the standstill period will in its turn depend on the length of any fixed term, the length of the notice to quit required to determine any periodic tenancy, the date when notice to quit is given and, most importantly, whether or not the period of any notice to quit is extended under section 103 or 104 of the Act. I cannot believe than, in a case where the new owner of property does not occupy, the vital question whether or not the tenant is to acquire a regulated tenancy can have been intended to be determined by such adventitious factors. Given that the purpose of paragraph 3 of Schedule 2 is that which I have indicated, but given also the restricted context of the other provisions of the statute to which the landlords’ arguments have drawn attention, is it possible to give the Act in this regard a purposive construction or, to put the question in more homely language, can the Act be made to work as paragraph 3 seems to intend that it should?  I think the answer to that question depends essentially on the view one takes of the status of a former contractual tenant during a standstill period under paragraph 3. Judge Leslie in the case of Newman took the view that on the termination of the contractual tenancy, the former tenant, although no order for possession could be made against him, became a trespasser. I cannot, with respect, share this view. A trespasser who retains possession after an order for possession has been made against him during a postponement of the execution of the order is, of course, a character well known to the law. But no instance was cited in argument of a trespasser against whom the court is prohibited by statute from making an order for possession. The position of a former contractual tenant whose sole protection is under paragraph 3 of Schedule 2 to the 1977 Act is similar to that of the statutory tenant under the pre-1920 Rent Restriction Acts of whom Scrutton LJ said in Remon v City of London Real Property Co Ltd [1921] 1 KB 49 at p 57: But Parliament did not in terms say that though his tenancy by agreement had expired, he had a statutory right to stay in on specified terms: it provided that no order for recovery of possession should be made, and omitted expressly to provide what sort of a legal interest the person who stayed in by permission of Parliament and against the will of the landlord should have . . . . Thus, although the former contractual tenant during the paragraph 3 standstill period is not a statutory tenant in the sense defined by section 2(1), he has the attributes of a statutory tenant, expressly quoad his protection from eviction and, I would add, by necessary implication quoad his rights and obligations under the terms of the former tenancy. He remains, however quoad control of his rent subject to the jurisdiction of the rent tribunal under Part V of the Act and not of the rent officer and rent assessment committee under Part IV. He has, in my judgment, a tenancy of a hybrid character, partly analogous to a statutory tenancy, partly analogous to a restricted contract. For want of anything better, I will call him a quasi-statutory tenant. If this is a legitimate view to take of the status of a former contractual tenant during the continuance of the standstill period under paragraph 3, then I think the difficulties arising from the absence of any express statutory provision applicable to him at the end of that period are readily surmounted. If by then the new landlord is resident, the quasi-statutory tenant loses all protection, but if the new landlord is not resident then, in my judgment by necessary implication, the quasi-statutory tenant becomes a full statutory tenant. For these reasons I too would allow both these appeals and set aside the orders made by both the county court judges. Also agreeing, STEPHENSON LJ said: The point raised by these two appeals arises from circumstances which must have been contemplated and provided for by Parliament on July 29 1977 when it passed the Rent Act–and the Protection from Eviction Act of that year. So anyone owning or wishing to occupy property as his residence and any practising lawyer would have thought and so the provisions of section 12 of and Schedule 2 to the Rent Act indicate. Parliament clearly did contemplate a resident landlord, who had granted a tenancy of a dwelling-house in another part of the same building, parting with his interest under the tenancy by death or by sale, and those to whom his interest was transferred ceasing to be resident landlords. It also contemplated such a tenancy, which had been precluded from being a protected tenancy, ceasing to be so precluded and becoming a protected tenancy and, on notice to quit served before it became a protected tenancy, becoming in certain circumstances a statutory tenancy. Furthermore, Parliament contemplated that the transferees of a resident landlord’s interest would need time to decide whether they or any of them should continue to occupy a part of the same building as their residence, and provided for periods to be disregarded. But the only provision which Parliament made in respect of the tenant’s position during those periods, including a tenant who is given notice to quit (though the provision does not say so), is the (to me still obscure) protection given him by paragraph 3 of Schedule 2. Persons in the position of the appellants are contractual tenants till the notice to quit takes effect. Till then each tenancy is to be treated as a restricted contract: section 20. Paragraph 3 of Schedule 2 does not say that it is a regulated tenancy, whether protected or statutory (section 18): it only says no order for possession shall be made other than an order82 which might be made if it were or had been a regulated tenancy; so the tenant is given the security conferred by section 98 of the Act. I would think that each appellant was clearly also subject to the limited protection from eviction as a ‘residential occupier’ conferred by section 1 of the Protection of Eviction Act 1977 and/or as an ‘occupier’ conferred by section 3 of that Act. I do not accept that he could be a trespasser, being lawfully in occupation of the premises. But are the applicants protected tenants as defined by section 1, or statutory tenants as defined by section 2, now or ever?  To be statutory tenants they must have been protected tenants immediately before they became statutory. But these tenancies have been precluded from being protected by section 12, and paragraph 3 of Schedule 2 says nothing–direct or clear at any rate–about their ceasing to be precluded or becoming protected, or statutory, or regulated. Hence the recourse in argument for the appellants to the latent protected tenancy on which to hang a statutory tenancy at the end of the contractual tenancy. These difficulties and obscurities, and others canvassed in the course of the argument and referred to in the judgments of my Lords, drive me to look at the broad purpose of the exception created by section 12. It is first of all an exception. It is precluding a tenancy which would be protected from being protected ‘at any time’ if, among other things, the owner of the landlord’s interest is in effect an owner-occupier, not an absentee, ‘at all times since the tenancy was granted,’ subject to the disregard periods. Except that those obviously reasonable gaps in the continuous occupation of the landlord’s part of the building are disregarded, that part must continue to be occupied by him or his successors in title as their residence until the hearing of any claim they may make to possession. If it ceases to be so occupied the exclusion of the tenancy of the other part from protection ceases and it is protected, just as the tenant of the other part would lose the protection of his tenancy, or his chance of its becoming protected, if his part had ceased to be occupied as his residence at the date of the hearing. The landlord can evict the tenant as long as they both live in the landlord’s building; but he is not given the asset of the tenant’s part with vacant possession for himself, his heirs or his purchasers, if the tenancy is determined, as these two tenancies have been determined, while no successor of his resides in the building. If the tenant continues in occupation the landlord’s successors cannot take advantage of the breathing space, given them by paragraphs 1 and 2 of the Schedule, in my opinion, for the purpose of making up their minds whether to reside in their part of the building or not, to evict him from his part of the building while they are not residing in their part. That is, I think, the intended effect of paragraph 3 in this still imperfect statute. If it is, why did the statute not say so more clearly?  It is a question often asked in interpreting this legislation but seldom answered with any approach to certainty. That it has not, in my judgment, been answered with certainty has less weight in the respondents’ favour than the judge gave it in Newman’s case. For the reasons given by my Lords, including the capricious results which follow from acceptance of the argument for the respondents, I would allow the appeal. Both appeals were allowed. Appellants’ costs in Court of Appeal and below to be taxed on scale 3 of the county court scales, with legal aid taxation of both appellants’ costs. Leave to appeal to the House of Lords was refused. Note: The Appeal Committee of the House of Lords has subsequently granted leave to appeal.