Lewis v Weldcrest Ltd

Rent Acts–Whether tenancy a protected tenancy or a business tenancy under Part II of the Landlord and Tenant Act 1954–Tenancy formerly controlled–Tenant took in a few boarders to help pay rent of a house too large for her–Modest income consisting of payments by boarders and social security payments–Tenant not carrying on a business–Question one of degree depending on such factors as number of lodgers or boarders, size of house, sums paid and services rendered–Tenant here reaped no real commercial advantage–Appeal from county court allowed This was an appeal by the tenant, Mrs Sarah Elizabeth Lewis, from a decision by Judge Burrell at Haverfordwest County Court refusing a declaration under section 105 of the Rent Act 1968 that her tenancy of 68 Bush Street, Pembroke Dock, was a protected tenancy to which the Rent Acts applied. Sir Ashley Bramall (instructed by Price & Kelway, of Pembroke Dock) appeared on behalf of the appellant; Michael Lewis QC and Roderick Evans (instructed by Mathias-Thomas & Lewis, of Tenby) represented the respondents. Giving judgment STEPHENSON LJ said: This is an appeal from a judgment of His Honour Judge Burrell given in the Haverfordwest County Court on March 1 1977 dismissing an application by Mrs Lewis under section 105 of the Rent Act 1968 to determine that her tenancy of 68 Bush Street, Pembroke Dock, in the County of Dyfed, is a protected tenancy and to declare that the Rent Acts apply to those premises. It is common ground that the applicant’s tenancy or the premises would be a regulated tenancy, protected by the Rent Acts, as the applicant claims, if it were a tenancy to which Part II of the Landlord and Tenant Act 1954 did not apply, but if it is a tenancy to which that Part applies it is not a regulated tenancy and is not protected by the Rent Acts, as the respondent company Weldcrest Ltd contend. The question for the judge and this court is whether on the undisputed facts Part II of the Act of 1954 applies to this tenancy. Fundamental to the correct answer to that question is section 23, subsections (1) and (2), of the Act of 1954. They provide: (1)  Subject to the provisions of this Act, this Part of this Act applies to any tenancy where the property comprised in the tenancy is or includes premises which are occupied by the tenant and are so occupied for the purposes of a business carried on by him or for those and other purposes. (2)  In this Part of this Act the expression ‘business’ includes a trade, profession or employment and includes any activity carried on by a body of persons, whether corporate or unincorporate. Was 68 Bush Street occupied by Mrs Lewis for the purposes of a business (within the statutory meaning of that expression) carried on by her or for those and other purposes?  The premises were let to her mother in 1940 by predecessors in title of the respondents. Her mother had been in the hotel business. When she took these premises, she took in lodgers. The rateable value of the premises in 1939 was £13 a year and the rent that the applicant’s mother paid was 37 1/2 old pennies a week. Her mother died in 1955 and she succeeded to her mother’s contractual tenancy, but in fact she came to a fresh agreement with her mother’s landlords and took a quarterly tenancy of these premises on October 30 1956, paying £4 17s 6d a quarter. It is agreed, although it does not appear from the evidence, that the rent which she is now paying is £1.50 per week. Like her mother, the applicant took in lodgers and has done so for more than 20 years. She has continued to live in the house, so there is no question that it is occupied by her. She has for her sole occupation, it would appear, though it is not altogether clear from the evidence, one bed-sitting room in the front. She also shares the kitchen, the bathroom and one other room–where her evidence was in fact taken on commission–with her lodgers. She was ill at the time when that evidence was taken and did not give further evidence at the hearing. She had at the date of the hearing five boarders, as she described them, or lodgers. She had had four. There are, in addition to the rooms which I have mentioned, three bedrooms, two on the first floor and one in the attic, as well as one useless room, perhaps also in the attic. Those three bedrooms were shared by her five boarders. They, according to her evidence–and her evidence was not challenged–normally stay a long time. One of her present lodgers had been occupying a bedroom in the house for seven years, another for five, another for two. It is well known in the district, and she used to advertise the fact, that she does take in lodgers or boarders. The welfare authorities sometimes request her to accommodate persons in urgent need of accommodation, and when she can, she complies with their requests. She pays for all the electricity and gas supplied to the premises and she provides and pays for all the bed linen. The rooms occupied by the lodgers are all provided furnished. They have no cooking facilities. She does most of the cooking. She cooks breakfast for all her lodgers, teas for some of them, and she provides them all with Sunday lunch. She charges four of them £3 a week each and one of them £2.50 a week; so that there is coming into her pocket or purse from her lodgers £14.50 a week. One of those, she says, she does not charge for meals because he takes messages for her. She gets £26.81 a week altogether, if you add to the rent that she gets from these lodgers the amount that she gets from social security. The tax authorities know about the money she gets from these lodgers, and she gets less in social security benefits to correspond with the amount which she gets from the lodgers. So that the taxpayers’ pocket is being saved by the payments which the lodgers make to her and which enable her to live in a house which without them would obviously be too big and too expensive for her. The learned judge said this of the purpose for which she65 occupied the premises: It was ‘a purpose which she could only achieve by one of two expedients: (a) drawing public assistance to pay the rent, or (b) taking in lodgers to pay the rent. To her credit and honour, the applicant uses expedient (b), but her purpose in occupying (viz. to have a home for herself) is the same whichever expedient she might adopt–ie that the lodgers are merely a means to her end, a means of achieving her purpose, and not the purpose itself.’  That is to some extent reproducing argument, but it is quite clearly setting out the commonsense factual position. Although there is no finding to this effect, it is clear to my mind from the undisputed facts, as I have called them, which I have just recited, that the applicant was making little or nothing out of her lodgers, but was adopting the expedient, it may be gladly, of having lodgers in order to enable her to continue to live in her old home as her dwelling. In those circumstances, the respondent company on August 13 1975 served on her a notice under section 25 of the Landlord and Tenant Act, purporting to terminate her tenancy as from March 25 1976. She on October 8 1975 served a counter-notice upon the company, but neglected to apply in time for a new tenancy. So that in fact, if she has the security provided by Part II of the Act of 1954 in law she has lost it in fact, but that cannot be a relevant consideration in considering whether the judge asked himself the right question and gave the right answer. With the valuable assistance of Sir Ashley Bramall, we have gone through the statutory history of premises like these. It establishes, I think, until January 1 1974 it would not matter whether, in taking in boarders or lodgers, Mrs Lewis was using the premises for business, trade or professional purposes or not. That appears, to start with, from the second proviso to section 12 subsection (2) of the Increase of Rent etc Act 1920, which provided that the Act should apply to a house or part of a house let as a separate dwelling in certain conditions ‘Provided that . . . (ii) the application of this Act to any house or part of a house shall not be excluded by reason only that part of the premises is used as a shop or office or for business, trade, or professional purposes.’  That provision was re-enacted by the first part of subsection (3) of section 3 of the Rent and Mortgage Interest (Restrictions) Act 1939. The interpretation put upon that provision by this court in Vickery v Martin [1944] KB 679 shows that if Mrs Lewis used some rooms herself to live in, it was her dwelling-house, and it remained her dwelling-house, protected by the Acts, even though a substantial part of the house was used or occupied as a guesthouse or for taking in lodgers. In 1954 the Landlord and Tenant Act was enacted and Part II, as is well known, dealt with the security of tenure of business, professional and other tenants, and greatly extended the range of those business tenancies which had been, it was thought, inadequately protected by the Landlord and Tenant Act of 1927. That Part of the 1954 Act did not apply to a dwelling-house partly occupied for business purposes. Section 43(1)(c) provided to that effect, and by Schedule 15 to the Rent Act 1968 the wording of it was clarified and abbreviated so as to read that this Part of this Act does not apply ‘to a tenancy which is excluded from this Part of this Act by section 9(3) of the Rent Act 1968.’ The Rent Act 1968, by section 9 subsections (1) and (3) and the provision in Schedule 15 to which I have just referred, preserved the security under the Rent Acts of such a dwelling-house if it was the subject of a controlled tenancy. By subsection (1) section 9 provided: ‘Subject to subsection (2) below’–which is not relevant for this purpose–‘the fact that part of the premises comprised in a dwelling-house is used as a shop or office or for business, trade or professional purposes shall not prevent the dwelling-house from being let on or subject to a controlled tenancy.’  By subsection (3): ‘Part II of the Landlord and Tenant Act 1954 (which gives security of tenure to business tenants) shall not apply to a tenancy where the property comprised therein is let under a tenancy which either is a controlled tenancy or would be such a tenancy if it were not a tenancy at a low rent.’ But before that statute Parliament had enacted the earlier Rent Act of 1965. That Act had created ‘regulated tenancies’ and put them in a different position, a position in which the question whether premises were used or occupied in part as a dwelling and in part for business purposes becomes relevant. Section 1 subsection (3) and Schedule 1, the first and third paragraphs, provided that the application of the Landlord and Tenant Act of 1954 was not affected by the application of the Rent Acts to regulated tenancies, and repealed or revoked the inclusion in the protection of the Rent Acts which had been given to such premises by the provisions of the 1920 Act and the 1939 Act, which I have already read, if those premises were the subject of regulated tenancies. In 1972 Mrs Lewis’s rateable value had risen from £13 to £42, and in that year the Housing Finance Act was passed. Section 35 provided for the conversion of tenancies which were controlled into regulated tenancies, and, by the provisions of section 35, where a dwelling-house elsewhere in England and Wales than in Greater London had a rateable value in 1972 of £35 or more but less than £45, the date for conversion applicable was January 1 1974. So the effect of that enactment on Mrs Lewis’s tenancy was to turn it from a controlled tenancy into a regulated tenancy as from January 1 1974, various alterations in many of the other applicable dates having been subsequently enacted, but that date having been left untouched by any subsequent statutory instrument. The result of all that legislation is that if, on its true construction, Part II of the Landlord and Tenant Act 1954 applies to Mrs Lewis’s tenancy, her tenancy is no longer a regulated tenancy and loses the protection of the Act. That follows from subsection (5) of section 9 of the Rent Act of 1968, which provides: ‘A tenancy shall not be a regulated tenancy if it is a tenancy to which Part II of the Landlord and Tenant Act 1954 applies.’  I do not think I need read the parenthesis. If therefore Mrs Lewis’s tenancy had remained controlled, her security of tenure and her statutory protection would remain under the Rent Acts, but as it is a regulated tenancy, the statutory security, if any, which she has will be derived from Part II of the Act of 1954 if, on its true construction, it applies to the facts of her tenancy. So the question is: Does it?  Which of these two securities now applies to her tenancy?  And we have to answer that question, as I have said, regardless of the fact that one of those securities has in fact been destroyed by the course which events have taken. The judge took the view that the security now provided for her tenancy was that of the Act of 1954, because in sum her tenancy is a business tenancy: and he reached that conclusion relying on authorities on breach of covenants in leases, in particular Tendler v Sproule [1947] 1 All ER 193 and a case not cited to us of Segal Securities v Thoseby [1963] 1 QB 887. He asked himself this question–he said it was the sole question–‘The sole question is therefore whether the applicant was ‘using the premises partly for business purposes’ (the words of the Rent Act 1968, section 9 subsection (5)) though at one stage of the hearing I was tempted to think that the relevant expression was that of the Landlord and Tenant Act 1954, which might have been capable of producing a different result.’ That is, if I may say so, a bad start, because the learned county court judge is posing as the sole question ‘whether the applicant was ‘using the premises partly for business purposes,” words which he ascribes to section 9 subsection (5) of the Rent Act 1968, and, as will be apparent from what I have just read, those words do not occur in that subsection of the Rent Act. He goes on to say that he has resisted the66 temptation ‘to think that the relevant expression was that of the Landlord and Tenant Act 1954 which might have been capable of producing a different result.’  I do not think there is any dispute between Sir Ashley Bramall, for the applicant, and Mr Lewis, for the respondents, that the relevant expression is that of the Landlord and Tenant Act 1954 section 23. It is not plain whether the county court judge would have reached the same conclusion if he had not erroneously thought that he was construing non-existent words in the Act of 1968 but had in fact yielded to temptation and embarked on a construction of section 23 of the Act of 1954. The question that he put at other points in his judgment, whether the premises were being used for business purposes, is the relevant question, but Sir Ashley Bramall has convincingly submitted that that question has to be answered in the light of the words used in section 23 of the Act of 1954 and not in the light of words used in leases as construed in other circumstances by the courts. I am satisfied that the learned judge was wrong in approaching the answer to that question as he did. The only decision with any real bearing on the question which we have to decide is a decision which was not, I understand, cited to the learned judge, and that is a decision of this Court in Abernethie v A M & J Kleiman Ltd [1970] 1 QB 10. The facts of that case were very different from the facts of this. There a tenant who lived over a shop had taken on the voluntary task of Sunday school teaching, and the county court judge, with more excuse than appears from that bare recital of the facts, had managed to find that he was a tenant who was occupying his premises for the purpose of carrying on a business together with the purpose of occupying it himself. The Court of Appeal allowed an appeal against that decision and held, in the words of the headnote, ‘that since the Sunday school was carried on by the tenant alone and not by a body of persons, the question whether it constituted the carrying on of a ‘business’ within section 23 of the Landlord and Tenant Act 1954 depended on whether it was a ‘trade, profession or employment’; that the pursuit by a person gratuitously of a spare-time activity in his own home was not a ‘trade, profession or employment’ within section 23 and therefore the tenant was not carrying on a ‘business’ within the meaning of the Act of 1954 and, accordingly, the premises fell outside that Act.’ The importance of that case is not the decision on the facts but the reasons for the decision, and in particular the reasons for the decision which were given by Harman and Edmund Davies LJJ. Of importance also is the judgment of Widgery LJ, the third member of the court, but it is the judgments of the first two Lords Justices which are important from the point of view of establishing the ratio decidendi set out in the headnote. Mr Lewis has challenged the accuracy of the first sentence which I have read from the headnote. It is to be noted that the argument for the tenant, reported in full, contained a submission that, in order to bring a tenancy within section 23, it had to be shown that the tenant was carrying on a trade, profession or employment; and, as I read the judgments both of Harman LJ and of Edmund Davies LJ, those two learned Lords Justices accepted that argument. It is also to be noted, and it was stressed in the argument in that case, that the definition with which we are concerned contains two parts, both of which are governed by the word ‘includes.’  Having set out the requirements in subsection (1) that the tenancy has got to be or include premises occupied by the tenant and occupied by him for the purposes of a business carried on by him, subsection (2) provides that ‘the expression ‘business’ includes a trade, profession or employment and includes any activity carried on by a body of persons, whether corporate or unincorporate.’ It is quite right, in my judgment, to say that this definition–and ‘definition’ is the word which can properly be used, though without prejudice to certain undertones that it may have–does expand the meaning of the expression. It certainly expands the meaning of the expression to include ‘any activity carried on by a body of persons, whether corporate or unincorporate,’ and, as I read those words, they include an activity which, if carried on by a single person, could not be described as a business, trade, profession or employment. A possible view of the subsection is that it also expands the meaning of ‘business’ to include something which is not a trade, profession or employment. That construction seems to me to be made more difficult by the concluding words describing other activities, but activities carried on only by a body of persons. Harman LJ clearly recognised the possibility that the first part of the definition included something other than trade, profession or employment. After reading the two subsections, he said at p 17-D of the report: ‘So that if the business, trade profession or employment is carried on by a single person, he must come within those words; but if the activity, whatever it be, is carried on by a body of persons, it will no doubt have a larger scope.’  If his judgment stopped there, it might be possible to read it as meaning that trade, profession or employment are three species of business but there may be other activities carried on by a single person, not by a body of persons, which come within the meaning of the expression ‘business.’  But his judgment goes on: ‘But I cannot accept that the word ‘activity’ has any bearing on anything that the judge had to decide, because there was no evidence before him that anybody but the tenant carried on this activity. Is it a trade, profession or employment?  It is clearly not a ‘trade’–clearly, I should have thought, not a ‘profession’.’  Then he decides that it is not an employment. He then went on to consider the case of Rolls v Miller (1884) 27 Ch D 71 and held that that case was clearly rightly decided but said that it was important to construe words of the kind that were contained in subsection (2) of section 23 of the Act in the context in which they appeared. He said: The Act of 1954 was for protecting business tenants, who, until then, had been hardly treated by their landlords; and to apply the terms of an Act of that kind to this circumstance is to fall into what I have somewhere else called the pond of absurdity. I would not have it that the tenant’s activity within the meaning of the Act of 1954 is a ‘business,’ even though in another context any activity which is not a pleasure may be called a business. It does not apply here because it does not fit the context in which the words appear. I read that judgment as confining ‘business’ to trade, profession or employment except in the case of a body. There it has a wider meaning and covers other activities than those three. To the same effect, in my judgment, is the judgment of Edmund Davies LJ. He wondered whether, even on the kind of enlarged meaning given to ‘business’ in the case of Rolls v Miller, that enlarged meaning could be said to embrace the activities of this tenant, Mr Abernethie. He pointed out that in other cases activities of bodies were being considered; and then comes to what he calls the word ‘business’ being ‘expansively defined’ in section 23, subsection (2). At p 19-C Edmund Davies LJ said: ‘Like Harman LJ I hold that, quite clearly, the tenant was not engaged in ‘a trade, profession or employment.’  That is so obvious that elaboration is not called for. . . . The only words which call for consideration here are the further words, ‘any activity carried on by a body of persons, whether corporate or unincorporate’.’  Then he pointed out that there was no suggestion that the Sunday school was carried on by a body; it was the tenant’s own little concern. Widgery LJ did not approach the matter in quite the same way. He pointed out that the definition of ‘business’ in the Act of 1954 was necessarily wide because the Act was intended to pick up a very wide range of tenancies which previously had no sort of protection at all. Shops, factories,67 professional offices, cinemas, tennis clubs and the like, were all without protection before 1954, except for the very limited coverage provided by the Landlord and Tenant Act 1927, and, it being the intention of Parliament to give protection to this wide range of commercial activity, the definition had to be a wide one. But it certainly does not follow from that that Parliament intended to push the tentacles of the Act of 1954 into domestic lettings and the activities which a man carried on in his private rooms as part of his hobby or recreation. He concluded: By and large . . . what a man does with his spare time in his home is most unlikely to qualify for the description ‘business’ unless it has some direct commercial involvement in it, whether it be a hobby or a recreation or the performance of a social duty, such as in the present case. On the face of it these are matters which are not ‘business’ matters at all: they go to a man’s private life in his domestic surroundings. Sir Ashley relies on that case, first of all, for establishing that to come within Part II of the Act of 1954 what the tenant must be carrying on and occupying his premises for is a trade, profession or employment. In my judgment, that is right. The headnote correctly reproduces the opinions of the majority, and although what they say must be read, as always, in the context of the facts of the particular case which they were deciding, it seems to me clear that they were deciding, as a matter of construction of the subsection, that trade, profession or employment are three categories which exhaust the meaning of the expression ‘business’ in so far as the tenant of the premises which it is sought to bring within the Act is a single person and not a body. Then he relies, secondly, on this decision of this court as warning that it is the definition in the Act which must be construed, and that little, if any, help in the construction of the Act is to be derived from the construction of covenants in leases, covenants not to use premises for business or trade but to use them as a single dwelling-house, or things of that kind. Thirdly, he relies on what Widgery LJ says about domestic lettings and the private activities in a dwelling-house of the tenant contrasted with commercial activity and involvement. It cannot be said that if we allow this appeal, we should be (to use Widgery LJ’s words) pushing ‘the tentacles of the Act of 1954 into domestic lettings and the activities which a man carries on in his private rooms as part of his hobby or recreation,’ but we should, he submits, be pushing the tentacles of the Act into domestic lettings and the activities which a tenant is entitled to carry on, either for gain or not for gain, to a certain degree without turning the user or the occupation of the premises into business user or occupation and the activities carried on there into a business. Mr Lewis has submitted, on the other hand, for the respondents, as I have said, that the decision of the majority in Abernethie does not construe the subsection as I hold that it does; but I think he would prefer to rest his support for the learned judge’s judgment on the submission that, assuming the headnote in Abernethie does correctly reproduce the ratio of the majority, this decision that the Act of 1954 does apply is right because what Mrs Lewis was doing was trading. She was carrying on a trade and this little house was being partly occupied for the purposes of a trade. It may be a matter of first impression, but my reaction is that it is as repugnant to commonsense to describe what this lady has been doing over the years as carrying on a trade as it would be to describe it as the carrying on of a business. Business or trade, it does not seem to me that these premises were being occupied for any such purpose. Sir Ashley Bramall has conceded that it is a question of degree, and if a tenant of premises takes in a number of lodgers, occupying some rooms himself or herself, and takes money from a large number of lodgers, that may well amount to the carrying on of a business and the occupation of the premises for the purpose of a business or trade. But he says it is a question of degree, and while it would be possible, perhaps sensible, to apply the Landlord and Tenant Act 1954 to many persons who may be said to be keeping a lodging house, a boarding house or a guest house, it is not possible or sensible to apply the Act to the activity of Mrs Lewis at the time when the judge had to decide the question referred to him under section 105 of the Rent Act 1968. The spirit of what Widgery LJ said in Abernethie’s case would be violated, as well as the construction put upon the subsection by the other two Lords Justices. It is interesting to note that Mrs Lewis herself was asked in cross-examination: ‘Do you describe the premises as a lodging house rather than as a private residence?’  Her answer was: ‘Taking boarders. I do not really know.’  Boarders or lodgers, boarding house or lodging house, I think that sort of answer to a question which I appreciate was not exactly the question that this court has to decide indicates how this is very much a matter of impression and a matter of degree; and it is, of course, rightly stressed by Mr Lewis (who, like Sir Ashley Bramall, has given me the greatest assistance) that in a matter of degree this court ought not, even in a case where the protection of the Rent Acts is involved, lightly to interfere with the decision of the county court judge and to hold that it falls on a different side of the line from that on which the county court judge put it. But there is no doubt in my mind that the learned county court judge was influenced, indeed really guided to his conclusion, by the authorities, to some of which Mr Lewis has referred us, on breach of covenant. He says so. He finds those cases helpful. He says: ‘I am invited to take the view that those cases decided by reference to covenants against using for business purposes are not to be relied upon in interpreting the same or comparable words in a statute or order. For my part, I take the view that this is to over compartmentalise the law, and to introduce a presumption that Parliament, by its Parliamentary draftsmen, legislates in vacuo.’  Then he said, reaching his conclusion: ‘Nevertheless, I hold that the situation in this case is such that the applicant was using the premises partly for business purposes within the authorities.’  Those authorities, as I say, did not include Abernethie’s case but did include the two which I have mentioned. The case of Tendler v Sproule followed that of Thorn v Madden. In Thorn v Madden [1925] Ch 847, Tomlin J had to consider whether a lady who had come from Liverpool to London and was taking in, to a very limited extent, paying guests in order to enable her to afford to live in her London house, was in breach of a covenant ‘not at any time during the term’ to ‘use or permit the said dwelling-house and premises to be used for the purpose of any trade or business whatsoever . . . or otherwise than as a private dwelling-house or professional residence only.’  The learned judge said at p 851: I think that, where, as here, a lady is of set purpose occupying a house which she is aware is beyond her means and, for the purpose of supplementing her means and enabling her to live in the house, is securing, to use a neutral term, visitors to come and live there for short or long periods upon payment for board and residence, it is impossible to say that the house is being used as a private residence only. It seems to me to be used by her in precisely the same way as it would be used by one who kept a lodging house or a boarding house (whatever the strict distinction between them may be), although there may be some differences in the actual methods employed. He went on to say: I think that such a case as this falls into a different category, and amounts to carrying on a business. It does not seem to me to be a necessary quality of a business that it should be advertised in an obtrusive manner or at all. For carrying on a business all that is necessary, I apprehend, is to take the steps required to secure the necessary customers and so on. 68 That decision was approved by this court in Tendler v Sproule [1947] 1 All ER 193, and the learned judge thought clearly that this case fell exactly within that sort of language. But, as Harman LJ pointed out in dealing with the case of Rolls v Miller, a landlord takes a covenant from a tenant not to carry on a business in conjunction with a covenant not to use the premises as other than a dwelling-house, and he takes such a covenant not only in his own interest but in the interests of the neighbours; and it may well be that where such a covenant has to be construed by the court, the court is bound to interpret such a covenant in the way in which it has been interpreted in such cases as those two. You cannot consider the covenant’s two parts separately; you must consider them together as parts of a whole, and where the intention is clearly that a house should be used as a dwelling-house and a dwelling-house only, and no business carried on in it, very different considerations arise. The purpose of the covenant is quite different, as it seems to me, from the purpose of Part II of the Landlord and Tenant Act 1954. The purpose of that Act was primarily to give security for tenure to people who would be said, in the ordinary use of language, to be using the premises for a business, even if they were living there as well, using part as a dwelling and part as a business. When I look at the words of the definition in subsection (2) I see nothing which extends that purpose to cover such activity in providing accommodation for boarders as Mrs Lewis provided in this house. It seems to me that there is nothing in the Act, in its wording or in my understanding of its purpose, to put this lady in the category of a trader or a person carrying on business at those premises. It is no one factor; it is all the factors–the number of lodgers, the size of the place, the sort of sums and services which were involved. I am unconvinced by Mr Lewis’s attempts, without having challenged her evidence, to show that this lady was really reaping any commercial advantage out of this activity of taking in lodgers. She was, as it seems to me, doing it probably because she liked it and they helped her to pay her way. As Mr Lewis says, it was her only occupation. I have no doubt that she was good at it. She was rendering a service to the lodgers and, indeed, to the public, and sometimes to the welfare authorities, and she was rendering a service to the taxpayer in reducing the amount of social security which had to be paid her. But the one thing that she was not doing, in my judgment, was carrying on a business or trade, whether ‘business’ is limited to trade or whether it can have any wider connotation. For these reasons, expressed, I am afraid, at too great length, I have come to the conclusion that the judge was wrong. I am helped to differ from his conclusion by the fact that he himself said that he might have reached a different conclusion if he had thought that the wording of section 23 of the Landlord and Tenant Act 1954 was relevant, or, at any rate, more relevant than the wording of covenants in leases construed in past times by the court. I think that the learned judge should not have dismissed the application. I would grant it, and determine that the Rent Act does apply, and that the Landlord and Tenant Act 1954 does not apply, to the applicant’s tenancy of these premises. ORMROD and WALLER LJJ delivered concurring judgments. In the course of his judgment Waller LJ said: I do not say that in no case can taking in lodgers be a trade. There may be many cases where to do so could properly be said to be carrying on a trade. For example, a large house with many rooms, all occupied by separate lodgers, with the tenant living either in the basement or occupying one or two rooms elsewhere in the house, and the tenant making profits, or perhaps considerable profit, out of the running of the house. Such a case may be clearly that of carrying on a trade. On the other hand, when these questions are questions of degree, there may obviously be cases which are near the line. But, as I have already indicated, I do not find the case of Mrs Lewis in her five-roomed house at 68 Bush Street in Pembroke Dock, with five lodgers, each making a minimal weekly payment for their lodging and feeding, is near enough to that line for me to feel any doubt that the house is not occupied for the purposes of a business carried on by her or for those and other purposes. The appeal was allowed and a declaration made that the applicant’s tenancy was a protected tenancy. The applicant was awarded costs in the Court of Appeal and county court (scale 3) with legal aid taxation. Leave to appeal to the House of Lords was refused.