Pittalis v Grant

Subtenancy — Determination of headtenancy — Subtenancy protected as a statutory tenancy — Whether subtenancy continues to qualify for protection under Rent Act 1977 — Landlord’s appeal succeedsIn 1882 no 92 High Road, Finchley, London N2, was let for a term of 99 years under a headlease containing no covenant against subletting. The premises consist of business premises at ground floor and a flat at first floor. In August 1977 the headlessee at the time granted a subtenancy of the flat to the respondent for a term of three years. At the expiration of that subtenancy, the respondent remained in possession under a statutory tenancy. Following the determination of the headlease, the headlessee at the time obtained a new lease under Part II of the Landlord and Tenant Act 1954. However, in June 1987 that headlease was surrendered to the freeholder, the appellant in this case. The appellant’s action for possession of the flat was dismissed by His Honour Judge Goldstone in the Barnet County Court (November 27 1987). He appealed on the ground that the respondent did not qualify for protection under section 137(3) of the Rent Act 1977; his appeal involved a point of law not raised before the county court. Held The appeal was allowed. 1. On the substantive question, the subtenancy did not qualify for protection under section 137(3) of the 1977 Act. That subsection applies “where a dwelling-house … forms part of premises” and the House of Lords in Maunsell v Olins [1975] AC 373 decided that “premises” had to be given a narrow meaning; they included any premises “which, as a matter of fact, applying accepted principles, would be held to be a dwelling-house for the purposes of the [1977] Act”. In the present case the property was held under the headlease, and that lease was a lease of business premises for the purposes of the 1954 Act; it necessarily follows that the property was not to be treated as a dwelling-house for the purposes of the 1977 Act and for that reason was not “premises” within the contemplation of section 137(3). 2. The decision of Smith v Baker & Sons [1891] AC 325, to the effect that there is no right of appeal from a county court on a point of law which was not raised before the county court, should no longer be followed. The statutory provisions concerning rights to appeal from county courts have now changed, and when account is taken of the ability of the Court of Appeal to overturn the county court on fact as much as on law, there is seen to be no foundation for the rule at all. Philip Engelman (instructed by Simon Wakefield & Co) appeared for the appellant; and David Reade (instructed by Henry Wimborne, of Edgware) appeared for the respondent.