Rent Act 1977 — Claim for possession under Case 9 in Schedule 15 — Claim by personal representatives who had no beneficial interest in house — Claimants were administrators of estates of two persons who had been the owners of the house and who had been killed in a car accident — Claimants became guardians of the orphaned children of the deceased and later adopted the children — Object of possession proceedings was to provide a home for the claimants and the children — Was the claim barred by a rule that personal representatives cannot be landlords for the purpose of Case 9 unless they had a beneficial interest in the house? — Sharpe v Nicholls, Parker v Rosenberg and Harrison v Hopkins considered — No rule that personal representatives cannot be landlords for this purpose — True explanation of the cases is that a personal representative normally cannot claim relief under Case 9 because in so doing he would be acting in breach of trust — In present case claimants were certainly not acting in breach of trust in seeking to live in the house with the children as a family home — Appeal from county court judge allowed and order for possession made
This was an
appeal by the plaintiffs, M M Patel and his wife I M Patel, from a decision of
Judge Tumin at Willesden County Court refusing their claim for possession of a
house at 9 Garratt Road, Edgware, from the defendant, B Patel (no relation),
who was in occupation as a statutory tenant.
P H Morgan
(instructed by Herbert & Gowers & Co) appeared on behalf of the
appellants; the respondent, B Patel, appeared in person.
Giving the
first judgment at the invitation of Ormrod LJ, O’CONNOR LJ said: This is an
appeal by the plaintiffs from an order of His Honour Judge Tumin, sitting in
Willesden County Court, refusing their claim for the possession of a house at 9
Garratt Road, Edgware.
The facts
giving rise to this case are tragic and simple. In December 1977 Mr and Mrs H M
Patel, the brother and sister-in-law of the male plaintiff, were killed in a
motor-car accident. They left two small children, then aged five and three.
They were the joint owners of 9 Garratt Road. The plaintiffs became guardians
to the two children in July 1978. They became administrators of the estates of
both the deceased in April 1979 and in March 1980 they adopted the two
children, who are now aged eight and five. By an agreement in writing, dated
June 18 1979, they let 9 Garratt Road to the defendant (who is not a relative,
although he has the same surname) for one year from April 1 1979 until March 30
1980. That agreement expired by effluxion of time and, subject to a matter I
will deal with under the respondent’s notice, the defendant held over as a
statutory tenant, as he was entitled to do. Thus it was that the plaintiffs
brought these proceedings for possession of the house, founding themselves on
Case 9 of Schedule 15 to the Rent Act That provision reads so far as is
material:
Where the
dwelling-house is reasonably required by the landlord for occupation as a
residence for:
(a) himself, or
the court may
make an order for possession. That provision appears in the 1977 Act, which is
a consolidating statute, effectively reenacting paragraph (h) in Schedule 1
under section 3 of the 1933 Rent Act.
In an
admirable and careful judgment the learned judge directed himself that the
issues in the case were:
(1) Are the plaintiffs landlords for the purposes
of Case 9: if they are not, that is the end of the plaintiffs’ case;
(2) if the plaintiffs are landlords for Case 9,
have the plaintiffs established that they reasonably require the property for
themselves?;
(3) if the plaintiffs reasonably require the
property for themselves, has the defendant established greater hardship?;
(4) is it reasonable to order possession?
First of all
the learned judge considered the last three topics and he found in favour of
the plaintiffs on all three heads.
The defendant,
who has appeared in person (and, if I might say, has conducted his case quite
admirably) does not seek to challenge the findings under (2), (3) and (4) to
which I have referred.
In answer to
the first question the learned judge, holding himself bound by the authority of
two cases in this court, found against the plaintiffs, and it is against that
that the appeal is brought.
Having looked
at the cases I, for my part, have concluded that the learned judge did not ask
himself the right question. Question (1) should have stopped at ‘Are the
plaintiffs the landlords of the house?’
The reason why
he asked the question as he did is undoubtedly due to the way in which the two
cases upon which he founded himself, namely, Sharpe v Nicholls
[1945] 1 KB 382 and Parker v Rosenberg [1947] 1 KB 371, have been
dealt with in the textbooks. The proposition has found favour with the textbook
writers from those cases that personal representatives cannot be landlords
unless they have a beneficial interest in the house. As I propose to show in my
judgment, that is not what the cases decide. The question which should be asked
is: are the plaintiffs landlords? And
the next question should be: have they established that they reasonably require
the property for themselves?
Let me get two
matters out of the way before I look at the authorities. The provision in Case
9 that the landlord reasonably requires the dwelling-house for occupation as a
residence for himself, ‘himself’ includes his spouse and children: see Smith
v Penny [1947] KB 230. Secondly, ‘landlord’ is to be interpreted, where
there are joint owners, as ‘landlords’: see Baker v Lewis [1947] 1
KB 186.
The two cases
of Sharpe v Nicholls and Parker v Rosenberg are
most conveniently considered in a later decision of this court, Harrison
v Hopkins [1950] 1 KB 124. That case was concerned as to whether a
personal representative tenant was a tenant for the purposes of the Rent Act.
Cohen LJ (as he then was) dealt in his judgment with the problems raised by Sharpe
v Nicholls and Parker v Rosenberg. His judgment
sufficiently sets out the facts of the case and I shall read an extract from
it. At p 132 he said:
In these two
cases, Sharpe v Nicholls and Parker v Rosenberg,
this court had to consider the rights of a landlord to possession. The question
in each case, however, arose not under section 12(1)(f) of the Act of 1920, but
under section 3 of the Rent and Mortgage Interest Restrictions (Amendment) Act
1933, and para (h) of Schedule I thereto. In the first case [that is Sharpe
v Nicholls] proceedings were commenced by the widow and nephew of the
deceased landlord as personal representatives to recover possession of premises
within the Rent Restriction Acts for the occupation of the widow. There was no
evidence to prove that the widow had any beneficial interest in the estate of
the deceased landlord. The actual decision in the case did not turn on whether
personal representatives were landlords within the meaning of para (h), but
Morton LJ expressed an opinion on the point, saying:
‘The plaintiffs’ whole case, as I have
shown from their pleadings, is based upon the allegation that they were the
owners as personal representatives. I cannot find any admission at the trial in
any shape or form that the widow had any beneficial interest in the house. I do
not know in the least who was entitled to the house. For all I know Mr Sharpe
may have made a will leaving it to a nephew or to any other person. In those
circumstances one must consider whether it can be said that the ‘dwelling-house
is reasonably required by the landlord for occupation as a residence for
himself or herself’, when the plaintiffs are legal personal representatives
suing in that capacity and one of them wants to live in the house. In my
opinion, such a case is not within the terms of para (h) of Sched I at all.
Strange results would follow if that were not so. For instance, you might have
four legal personal representatives, none of whom was related to the testator
at all, and one of them might require the house as a residence for himself or
herself, having no beneficial interest whatsoever in the property. I am clearly
of opinion that such a case could not possibly be within the terms of para (h).
It is also to be observed that the words ‘himself or any son or daughter of his
. . . or his father or mother’ seem to refer to a person who is the landlord
not in the sense that he or she is one of several personal representatives, but
in the sense that he or she is the sole owner of the property subject to the
tenancy. It seems to me, therefore, that the plaintiffs entirely failed to
prove that they came within para (h); and that if they failed to prove that
they came within para (h) the words of section 3 of the Act absolutely
precluded the county court judge, and would preclude this court, from making
any order for the recovery of possession.’
These
observations were obiter; but in the second case, that of Parker v Rosenberg,
they were approved and applied to a case where legal personal representatives
were seeking to recover possession of premises for the occupation of a sister
of the testatrix who was the tenant for life under her will. Tucker LJ said:
‘It is clear that neither the definition section of the Act of 1920 nor para
(h) of Sched I to the Act of 1933 confer on anyone any right to an order for
possession which he does not otherwise possess. Para (h) is designed to relax
in certain cases the previously imposed statutory restrictions on the right of
recovery. In the present case Miss Marsh, apart from the Rent Restrictions
Acts, would not have been entitled to sue in ejectment. She was not a party to
the lease and was not entitled to the reversion. There is nothing in para (h)
of Sched I to the Act of 1933 enabling her to sue or be added as a plaintiff.
As the proper plaintiffs, the trustees, cannot bring themselves within para (h)
and Miss Marsh cannot herself sue, it follows that no order for possession
could properly be made in the present case.’
Those
decisions lend some colour to Mr Stabb’s argument, but I would observe that the
question in each case before the court was not as to the meaning of the
expression ‘landlord’ in the abstract, but as to the right of the landlord to
possession under para (h) of Sched I to the Act of 1933, and the landlord had
therefore to prove not only that he was a landlord but also that he required
the premises for his own occupation, and that greater hardship would be
involved in refusing him possession than in depriving the tenant of possession,
a burden which plainly an executor or administrator without a beneficial
interest in the property would be unable to discharge. These considerations are
not expressly mentioned in the judgments in the cases cited, but they afford a
means of reconciling them with the earlier opinion expressed by Morton LJ in Lawrance
v Hartwell [1946] KB 543.
It will be
seen that, in considering these cases, Cohen LJ was saying, in my judgment
correctly, that they are not decisions construing ‘landlord’ in the abstract.
The real reason why it would not be reasonable to make an order in favour of
personal representatives who are landlords is because, in the ordinary course
of events, if they claimed possession for their own occupation, they would be
acting in breach of trust. This proposition will be found in the same case in
the judgment of Asquith LJ (as he then was) at p 135 where he said:
Further, it
is contended, that, on the alternative view, a personal representative who is a
trustee would necessarily, in circumstances such as those of the present case,
make a profit out of his trust.
In my view,
the true ratio of those cases is that a personal representative normally cannot
claim relief under Case 9, as it now is, because, in so doing, he would be
acting in breach of trust. This is a wholly exceptional case. In the present
case the plaintiffs, under the terms of the agreement, are quite plainly the
landlords of 9 Garratt Road and, in my judgment, the defendant is not entitled
to challenge that status. There is nothing in the Act which says that personal
representatives cannot be landlords. Indeed, section 152 leads one to the
contrary conclusion as one would expect. As landlords they are personal
representatives in this case and they are trustees for the two children. In the
present case, in considering whether it is reasonable to make the order on that
particular ground, they are not acting in breach of trust in seeking to live in
the house with the children. The children are the beneficial owners of the
house and those exceptional circumstances take this case out of the decisions
in Sharpe v Nicholls and Parker v Rosenberg.
In my
judgment, the learned judge understandably fell into error in considering that
he was bound by those decisions to find against the plaintiffs. On the main
ground of the appeal, therefore, I am satisfied that these plaintiffs were
entitled to rely on the provisions of Case 9 and, as all the other requirements
were found in their favour, unless there is anything in the respondent’s notice
I would set aside the judgment and order possession of the house.
The defendant
has submitted in his respondent’s notice that the learned judge found facts
from which we should infer that he had a further contractual tenancy which had
never been determined. It was his case that, in March 1980, just before the
written agreement expired by effluxion of time, he agreed with the male
plaintiff that he should stay on in the house indefinitely at the same rent.
The learned judge dealt with that proposition in his judgment in this way:
I find that
the facts as to what happened in March and April 1980 do not require a complete
finding. The first plaintiff did give an indication that the defendant would
not be required to move out at once. The first plaintiff’s recollection is that
he went to America on business and does not recall seeing the defendant. I also
find that at some time about then there was some mention made of the defendant
buying the premises and of the premises being sold. It took some time for the
first named plaintiff to make up his mind and discuss it with his family. These
matters do not affect the first plaintiff’s evidence.
In the
evidence it is quite plain that the defendant said he went to see the male
plaintiff on Sunday March 30 and gave him a cheque for £150 for the next month
of tenancy and that it was accepted by the male plaintiff. The male plaintiff,
in his evidence — and the learned judge held that he was an honest witness and
that he
United States of America by air, that he never saw the defendant, and never
received any cheque. The fact is that the plaintiffs’ solicitors sent a cheque
dated March 31 back to the defendant in a letter early in April. The evidence
does not show as to how that cheque came into their possession; it may be that
it was put through the letter box by the defendant, because he lives within a
short distance of the plaintiffs’ address at 1 Deansbrook.
For my part I
can see no reason for inferring that the learned judge found any facts from
which it is possible for this court to say that the defendant had acquired a
contractual tenancy by agreement with the male plaintiff by tendering rent and
its acceptance, and I would not hold that he is able to get that submission on
its feet. For these reasons I would allow this appeal and order that the
plaintiffs have possession of the house.
Agreeing,
SHELDON J said: I agree that the appeal should be allowed and that the
respondent’s appeal should be dismissed. The plaintiffs let these premises to
the defendant. They created the tenancy agreement, whatever their title, and
even if at the time they had none, by general principles, using the words in
their ordinary meaning, as between themselves and the defendants, they became
his landlord. The learned judge, after careful examination of all the relevant
facts, found that they reasonably required the premises for occupation as a residence
for themselves and their family. He also decided that the defendant had not
succeeded on the issue of greater hardship and held that it was reasonable to
make an order for possession. At first glance, therefore, it is difficult to
understand why such an order should have been refused.
The mistake
made by the learned judge, and the error into which he fell, resulted, in my
opinion, from a misunderstanding of the real basis on which the cases of Sharpe
v Nicholls and Parker v Rosenberg were decided. Nor was
such a misunderstanding inexcusable, having regard to some of the observations
made in the course of the judgments in question. Thus, in Parker v Rosenberg
at p 376 Tucker LJ stated in terms that the earlier case had decided that
‘personal representatives having no beneficial interest in the dwelling in
question cannot avail themselves of paragraph (h) of Schedule I to the Act of
1933:’ — in other words, that they could not claim possession of the
dwelling-house on the grounds that it was ‘reasonably required by the landlord
. . . for occupation as a residence for himself’.
Factually in
those cases, although Sharpe v Nicholls was a case which was sent
back to the county court to be reheard, that may have been so — maybe in most
cases the result would be the same — but, in my opinion, Tucker LJ’s
observation is not properly to be understood as stating a proposition of law.
In my view it is not correct to say as a matter of law that personal
representatives, having no beneficial interest in the property, could never be
the landlord within the meaning of paragraph (h) of Schedule I to the 1933 Act
— a provision which corresponds in terms to Case 9 of Schedule 15 to the Rent
Act 1977.
In my opinion,
subject only to one comment, the correct approach to these cases and to what
they decided is set out in the judgment of Cohen LJ in Harrison v Hopkins
to which reference has already been made but which, for completeness, I will
repeat. The learned lord justice there said that in those cases of Sharpe
v Nicholls and Parker v Rosenberg
the question
. . . before the court was not as to the meaning of the expression ‘landlord’
in the abstract, but as to the right of the landlord to possession under para
(h) of Schedule I to the Act of 1933, and the landlord had therefore to prove
not only that he was a landlord but also that he required the premises for his
own occupation, and that greater hardship would be involved in refusing him
possession than in depriving the tenant of possession, a burden which plainly
an executor or administrator without a beneficial interest in the property
would be unable to discharge.
My only
criticism of this passage is that the comment that this was ‘a burden which
plainly an executor or administrator without a beneficial interest in the
property would be unable to discharge’, though doubtless in most cases is true,
was an unnecessary addition to the general proposition and, as the facts of the
present case have demonstrated, was not necessarily correct. In my opinion, the
question of whether or not personal representatives can bring themselves within
the provisions of Case 9 is one that has to be answered by applying normal
principles of law, using normal canons of construction and in the light of all
the facts of each particular case. In the circumstances I have no doubt
whatever that, on the findings of fact made by the learned judge, the plaintiffs
are entitled to the order they seek.
I would adopt,
indeed, the direct approach of the court in Stratford v Syrett
[1958] 1 QB 107, reflecting the closing passage of Lord Evershed MR at p 114. I
can see no answer to the simple proposition that, being the defendant’s
landlord, they have succeeded in establishing a ground which entitles the judge
to make an order for possession, and that he has thought it reasonable to do.
That order, therefore, in my opinion, should have been made.
Also agreeing,
ORMROD LJ said: I entirely agree with both the judgments which have been
delivered and only add one thing. This case is very exceptional in that the
personal representatives, the landlords, are in a position to show that they
require the premises for occupation by themselves, they are able to show that
they reasonably require the premises because, in occupying them, they will not
in the particular circumstances of this case be in breach of trust, and,
consequently, they are able to deal with the other matters as well. They did
succeed in showing that it was reasonable for the court to make an order and
also they were able to rebut the suggestion that greater hardship fell on the
tenant rather than on themselves. If they were in breach of trust, of course,
they could not do any of those latter things. They could not show that they
reasonably required it or that it was reasonable to make an order, and they
would not have any standing at all on the hardship issue.
For those
reasons I agree that the appeal should be allowed and an order for possession
made.
The appeal
was allowed with costs.
