Pocock v Steel

Rent Act 1977 — Case 11 in Schedule 15 (premises let by an owner-occupier) — Whether an owner who has not been in occupation for a lengthy period before granting a regulated tenancy can claim possession under Case 11 or whether the words ‘occupied’ and ‘let’ in Case 11 refer to substantially the same point of time — In fact the appellant in the present case (the plaintiff in the court below) was not the legal owner of the reversion, which was vested in her marriage settlement trustees (of which she was one) — She had occupied the property under a power in the settlement, but had not been in occupation since 1967 — The subject dwelling-house had been let furnished to a succession of tenants (either by the appellant herself or by the trustees) and it was accepted that the statutory notices under Case 11(a) had been served — The main point at issue in the appeal was the correct construction of the opening words of Case 11 — The appellant submitted that a construction which required actual occupation by the owner at the time of granting the regulated tenancy would cause inconvenience and anomaly; it would mean that an owner who went abroad would not be able to grant successive tenancies of his dwelling-house without intermediate periods of actual occupation by himself — The appellant also argued that the wording of the Case in the 1968 and 1977 Rent Acts (both consolidation Acts) should be construed in the light of the original wording of section 14(1) of the Rent Act 1965, where ‘has occupied’ and ‘has let’ supported a different construction — These arguments were rejected by the Court of Appeal, who upheld the decision of the county court judge refusing an order for possession — Case 11 contemplates a correspondence in point of time between the owner’s occupation and the date of letting — This view was in harmony with dicta in Tilling v Whiteman, although the present point was not there in issue — Appeal dismissed The appellant, Mrs Rosemary Ann Pocock, appealed against a decision of Judge Galpin, at Portsmouth County Court, refusing her an order for possession of a dwelling-house known as Little Bushy, at Steep, near Petersfield. The judge had reversed an order made by the registrar in the appellant’s favour. The present respondent, Karen Nicola Steel, was the tenant and the defendant in the court below. In the present appeal she raised various questions in a respondent’s notice, but in view of the court’s decision they did not now arise. J C Lofthouse (instructed by Burley & Geach, of Petersfield) appeared on behalf of the appellant; John R Davies (instructed by Mackarness & Lunt, of Petersfield) represented the respondent. Giving the first judgment at the invitation of Cumming-Bruce LJ DILLON LJ said: This is an appeal by the plaintiff in the action, Mrs Rosemary Pocock, against a decision of Judge Galpin given in the Portsmouth County Court on May 31 1984. The appeal raises a question under the Rent Act 1977. By an agreement in writing dated December 7 1982 the appellant granted the respondent, Karen Nicola Steel, a furnished tenancy of a dwelling-house known as Little Bushy, Steep, near Petersfield, for a term of one year less one day from December 12 1982. That tenancy agreement created a regulated tenancy within the meaning of the Rent Act. However, in the tenancy agreement the appellant gave notice to the respondent by clause 7 claiming to be the owner-occupier of the dwelling-house within the meaning of Case 11 in Part II of Schedule 15 to the Rent Act 1977, and stating that possession of the property might be recovered by her under Case 11. The precise wording of clause 7 is not material. The tenancy was extended by agreement for a further three months from December 12 1983 but, after the extended term had expired, the respondent refused to give up possession, and the appellant now requires possession so that the property can be occupied as their residence by her daughter and son now aged 19 and 17. The question is, therefore, whether the appellant makes out her claim within Case 11 in Schedule 15 to the 1977 Act. So far as material that case reads, as amended and currently in force, as follows: Where a person who occupied the dwelling-house as his residence (in this Case referred to as ‘the owner-occupier’) let it on a regulated tenancy and (a) not later than the relevant date the landlord gave notice in writing to the tenant that possession might be recovered under this Case, and (b) the dwelling-house has not, since . . . (ii) 14th August 1974, in the case of a regulated furnished tenancy . . . been let by the owner-occupier on a protected tenancy with respect to which the condition mentioned in paragraph (a) above was not satisfied, — and (c) the court is of the opinion that of the conditions set out in Part V of this Schedule one of those in paragraphs (a) and (c) to (f) is satisfied. The conditions set out in Part V of the Schedule include as (a): the dwelling-house is required as a residence for the owner or any member of his family who resided with the owner when he last occupied the dwelling-house as a residence. The importance of Case 11 is that, if the facts to bring a particular situation within Case 11 are established, the court has no discretion to withhold an order for possession. If Case 11 is made out, an order for possession must be made. The present case came originally before the county court registrar. The respondent at that time had no legal representation, apparently because her application for legal aid was still pending. The registrar decided in favour of the appellant and made an order for possession, but the respondent appealed to the judge. He allowed the appeal and dismissed the appellant’s claim for possession. Although various other grounds were argued before the judge which are the subject of a respondent’s notice, his decision in favour of the respondent was on one ground only, and that arises on the opening words of Case 11, which I quote again: Where a person who occupied the dwelling-house as his residence . . . let it on a regulated tenancy . . . In point of fact, the appellant’s occupation of the property ended 17 years ago. The legal title to the property has, since October 1963, been vested in the trustees of the appellant’s marriage settlement on trust for sale. She herself has been one of the trustees, with her brother, since December 1976. She is entitled under the marriage settlement to the income from the proceeds of sale and to the net rents and profits until sale of the property, and from 1963 to 1967 she occupied the property under a power in the marriage settlement. Her son and daughter, who were then young children, lived with her in the116 property then. However, she went to live elsewhere in 1967 and has not occupied the property herself since then. Instead, it has been let furnished to a succession of tenants either by the trustees or by the appellant herself. In relation to each of the tenancies granted since August 14 1974 it is asserted (though this question arises only in relation to the respondent’s notice) that not later than the relevant date, which is the date of the commencement of the tenancy, the appellant gave notice in writing to the tenant that possession might be recovered under Case 11 (or its predecessor). The question, therefore, on the appeal is whether it is sufficient to satisfy Case 11 if the owner-occupier occupied the property at some time, however long ago and however long before the grant of the relevant regulated tenancy, or whether the words ‘occupied’ and ‘let’ in the opening words of Case 11 are to be taken to refer to substantially the same point of time. On the cross-notice various questions are raised stemming from the fact that the appellant is not herself the owner of an estate in the property but merely has the possession and interests in relation to her marriage settlement which I have mentioned. The practical objection to the construction of Case 11 that the words ‘occupied’ and ‘let’ refer to substantially the same point of time is that, if an owner-occupier quits a dwelling-house, for instance to take up an appointment elsewhere for a period of years, and grants a tenancy which is, on any view, within Case 11, then, if the tenant dies or goes away, the landlord owner-occupier will have to go back into occupation of the property before he can safely grant a new tenancy to someone else which will be within the protection of Case 11. The question is whether it is permissible for an owner-occupier, provided appropriate statements are made to satisfy condition (b), to grant a succession of tenancies which will be protected by Case 11, however long the owner-occupier may remain out of occupation of the property. This difficulty was clearly appreciated by His Honour Judge Galpin, and his own inclination was, therefore, to adopt the appellant’s construction of Case 11. However, he decided against the appellant on the basis of obiter dicta by Shaw LJ and Eveleigh LJ in Tilling v Whiteman [1980] AC 1. The question at issue in Tilling v Whiteman was a different question not relevant to the point on the appeal and, in fact, more relevant to the points taken by the respondent’s notice. In Tilling v Whiteman there had been joint owners of the property, one of whom had remained in occupation up to the grant of the tenancy to the defendant, and possession was sought so that one of them but not the other could resume occupation of the property as her residence. The dictum of Shaw LJ quoted by the learned judge was as follows (p10): It is apparent that the characteristics which serve to identify an owner-occupier in this context are (i) that he owned the interest out of which the regulated tenancy was granted, and (ii) that he had occupied the dwelling-house as his residence at the time that he let it on a regulated tenancy. The dictum of Eveleigh LJ is as follows (p12): (We are not concerned in this present appeal to decide whether the occupation must be immediately before the letting or whether occupation at any previous time will do. However, as the past perfect tense is used for both the verbs, there is much to be said for the contention that the occupation has to be the last occupation of the dwelling-house before the letting.) In this court the inconvenience and illogicality of a construction which would prevent a landlord who, for instance, went abroad on a three-year basis granting successive tenancies under Case 11, without having come back to resume actual occupation himself, is strongly stressed by Mr Lofthouse for the appellant. He also advances an argument based on the legislative history of the enactment. He refers first to section 14(1) of the Rent Act 1965 which, it seems, introduced this type of exception to rent control. There the wording used is: Where a person who has occupied a dwelling-house as his residence (in this section referred to as the owner-occupier) has let the dwelling-house on a regulated tenancy and the conditions mentioned in subsection (2) of this section are satisfied, . . . The words used are ‘has occupied’ and ‘has let’. On that wording Mr Megarry QC (as he then was) in the 10th edition of his book on the Rent Acts at p 311 commented: Despite the statutory phrase ‘owner-occupier’, there seems to be nothing to require ownership in fee simple, so that a tenant who has sublet a dwelling-house may satisfy the condition. Nor is there any limitation of time or capacity in the requirement of occupation as a residence, so that it might be satisfied, eg by occupation for a few months qua licensee twenty years before becoming owner. The present wording ‘occupied’ and ‘let’ came in with the 1968 Rent Act. See the Rent Act 1968, Schedule 3, Part II, Case 10, where the wording is: Where a person who occupied the dwelling-house as his residence (in this Case referred to as ‘the owner-occupier’) let it on a regulated tenancy. The Rent Act 1968 is expressed to be a consolidating Act and the wording in the 1968 Act is taken from that Act into the 1977 Act with which we are concerned. So it is said that the dicta of Shaw and Eveleigh LJJ were wrong; they failed to appreciate that they were concerned with a consolidating Act which ought to be construed by reference to the wording in the original Act and, if the words ‘has occupied’ and ‘has let’ are looked at, then, it is said, it does not really appear that there is any link in time between the two. For my part, I see the force of these arguments, but I regard the wording of Case 11 in the 1977 Act as clear: ‘Where a person who occupied the dwelling-house . . . let it on a regulated tenancy.’ The change of tense has removed any real ambiguity there might have been under the 1965 Act. The court has to construe the 1977 Act as it stands. It is not appropriate, just because the 1968 Act was a consolidating Act, to treat the 1977 Act as if it contained the wording of the 1965 Act which is not its actual wording. Neither the reference to past legislative history nor the anomaly of the inability to grant successive tenancies within Case 11 without an intermediate period of actual occupation can prevail against the clear wording of Case 11. Accordingly, I would, for my part, affirm the judge’s decision and dismiss this appeal. I have considered whether condition (b) in Case 11 is a pointer to a different result. That envisages that condition (a), as to giving notice in writing to a tenant that possession might be recovered under Case 11, must have been complied with on previous tenancies granted by the owner-occupier. It thus envisages that there may have been several tenancies granted by the owner-occupier; but I do not, for my part, find that enough, nor did Mr Lofthouse seek to regard it as anything other than neutral. It could apply if, for instance, the owner-occupier goes away and grants one tenancy, comes back, and then goes away again and grants another tenancy, possibly on another posting to a different place of work. The respondent’s notice raises points which, on the view I take on the appeal, do not arise. Essentially, the main point taken is that, if the previous tenancy agreements granted from 1974 onwards before the tenancy to the respondent, and the notices given in relation to those tenancy agreements, are looked at, the proper conclusion is that the appellant herself, in entering into the tenancy agreement with the respondent, was doing so as an agent for the trustees and not on her own behalf, and the trustees have not as such ever occupied the property as their residence. The short answer to this is, in my judgment, that which the learned judge gave by reference to the case of Stratford v Syrett [1958] 1 QB 107, a decision of this court; and I apprehend that that conclusion is fortified by the observations of Eveleigh LJ in his judgment, which was approved by the House of Lords, in Tilling v Whiteman at p 13C. But it is unnecessary to elaborate these points. I would dismiss this appeal. Sir DENYS BUCKLEY agreed and did not add anything. Also agreeing, CUMMING-BRUCE LJ said: I would only add to the reasons stated in the judgment of Dillon LJ that, in my approach to the instant problem of construction, I am assisted by the observations of Lord Fraser of Tullybelton at the end of his dissenting speech in Tilling v Whiteman, where at p 24 he said: I do not find any assistance in the policy of section 10 of the Act*, which is the section authorising Schedule 3. No doubt section 10 is intended to benefit owners, and to increase the supply of houses for letting, but it is an exception to the main policy of Part II of the Act, which evidently is to give security of tenure to tenants. The question is, what are the limits of the exception, and the answer must, I think, be found simply in the words used by Parliament. *Editor’s note: This is a reference to the Rent Act 1968. I can find nothing in the speeches of the majority which indicate that their lordships, in the majority, are approaching the question of construction in a different way. So, for the reasons explained by Dillon LJ, on the language of Case 11 of the relevant schedule, there is a reasonable correspondence in point of time contemplated as the date of occupation and the date for the letting. I agree that the appeal should be dismissed. The appeal was dismissed with costs.