Barrett v Lounova (1982) Ltd
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE KERR,MR. JUSTICE SWINTON THOMAS |
| Judgment Date | 22 June 1988 |
| Judgment citation (vLex) | [1988] EWCA Civ J0622-5 |
| Docket Number | 88/0533 |
| Court | Court of Appeal (Civil Division) |
| Date | 22 June 1988 |
[1988] EWCA Civ J0622-5
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE SHOREDITCH COUNTY COURT
(MR. RECORDER D. KEANE)
Royal Courts of Justice
Lord Justice Kerr
and
Mr. Justice Swinton Thomas
88/0533
Case No. 87 14333
MR. R. PRYOR Q.C. and MR. S. MONTY (instructed by Messrs. Bernstein & Co., Solicitors, London, N16 5SR) appeared on behalf of the Defendant (Appellant).
MR. D. WOOD Q.C. and MR. M. SEAWARD (instructed by Messrs. George J. Dowse & Co., Solicitors, London, E8 3DF) appeared on behalf of the Plaintiff (Respondent).
This is an appeal from a decision of Mr. Recorder Keane in the Shoreditch County Court given on 10th December 1987. The case concerns an end of terrace house in the East End of London in the Borough of Hackney, 70, Lansdowne Drive, E8, which has been occupied under the Rent Acts since 1941. The outside of the premises is in a bad state of repair and dilapidated; probably no work has been done to it for decades.
The issue is whether the landlord is bound to repair the outside. The tenancy contained a covenant that the tenant should keep the inside in good repair and it gives the landlord access for any reasonable purpose. But there is no express obligation on anyone to keep the outside in repair. The Recorder held that a term was to be implied, correlative to the tenant's obligation, to the effect that the landlord would keep the outside in a reasonable state of repair. There is also, in the alternative, an issue under section 4 of the Defective Premises Act 1972, but the main issue on this appeal has been whether a term can be implied as the Recorder has held.
I turn to the tenancy agreement. This was made on 5th April 1941 between a Mr. Frank Hayllar of Brighton, described as a Solicitor, as "the landlord", and a Mr. Albert Arbon of Dalston, described as a bread baker as "the tenant". It demised the house together with the landlord's fixtures in and about the premises, "From the twelfth day of April 1941 for the term of One year certain and thereafter on a monthly tenancy At the yearly rent of Seventy-eight pounds such rent to be payable weekly in advance on Monday in each week. The first payment of one pound ten shillings to be made on the signing hereof". There followed the covenant to pay the rent; I need not read that. But I must read the following one:
"The tenant hereby agrees….. To do all inside repairs (if any) now required and to keep and at the expiration of the tenancy to leave the inside of the said premises and fixtures in good repair order and condition but fair wear and tear to be allowed at the end of the tenancy."
Next the tenant agreed:
"To permit the landlord and his agents to enter at all reasonable times upon the said premises and for all reasonable purposes."
Then I can go on to the tenant's agreement:
"Not without….. consent….. to make any alterations in or addition to the said premises (and) not to carry on any trade or business upon the said premises or to use the same otherwise than as a private dwellinghouse."
The only relevant agreement on the part of the landlord was that the tenant should be entitled to quiet possession in the usual way and that the landlord would pay all rates and taxes payable in respect of the premises so long as the tenant performed his part of the agreement and paid all monies due from him punctually.
The whole agreement must of course be construed by reference to the circumstances as they existed at the conclusion of the contract. The Recorder referred to some allowances in the early rent books in evidence, which had evidently been made by the landlord for minor external work done by the tenant, as being consistent with his conclusion that the landlord was under an obligation to repair, though rightly not as any aid to the construction of the agreement. I put that matter out of my mind.
The plaintiff occupies the house as the result of two transmissions under the Rent Acts. After the death of the original tenant the tenancy was. transmitted to his widow and I understand that the plaintiff is her daughter. So far as the landlord company is concerned, it is not known when they acquired this freehold.
To complete the history, more for historical than for any other purposes, the rent has now gone up to £15.00 per week.
Compalints from the tenant about the state of disrepair of this property began in May 1985, and proceeded with a solicitors' letter in August 1985. There was then a surveyors' report with further chasers which were sent more or less throughout 1986. Ultimately there was some response from the landlord and an inspection was carried out on his behalf. But recently the landlord changed his mind and claimed that upon the true construction of the agreement there was no obligation to repair.
The particulars of claim were issued on 20th March 1987. Under the heading "Particulars of Defects" they include the following:
"The structure and exterior, including the drains and gutters, of the premises is in such poor condition as to cause extensive water penetration and damage to the. internal plaster and timbers."
Then there is reference to a survey report which sets out the defects in detail.
There was also a claim in the alternative under the Defective Premises Act 1972, to which I shall come later.
The defence was simply a denial of liability on all counts.
In the course of the hearing it was agreed that the plaintiff was entitled to damages in the sum of £1,250 subject to liability. These were to cover special as well as general damages—damages for inconvenience, any damage caused to the contents by damp and so forth.
A fairly comprehensive schedule of dilapidations was also agreed, on the basis of what a repairing covenant by the landlord, if one were to be implied, would require to be done to the premises. The cost was estimated at about £10,000.
As I have mentioned, the Recorder took the view that such a covenant should be implied. He accordingly gave judgment for the sum of £1,250 and ordered an injunction in terms of the schedule agreed between the surveyors, to be carried out within six months from 10th December 1987, the date of his order. He granted a stay of twenty-one days for the purposes of an appeal, but only subject to the payment of £5,000 into court within seven days.
Apart from giving notice of appeal, the landlord did nothing at all in relation to that order and it was rightly conceded on his behalf that the company was clearly in contempt of court.
When the time for the hearing of this appeal approached, a few days after the expiry of the six-month period on 10th June, it appears that a builder was sent to the premises, but without any prior notice, and not surprisingly he was not admitted by the plaintiff in those circumstances. Moreover, the sum of £5,000 was not brought into court.
Accordingly, we declined to proceed with the appeal unless and until £5,000 was brought into court. That was done last Monday, the day on which we heard this appeal, and the sum was duly paid into the Shoreditch County Court.
Against that background I turn to the issue whether or not there is to be implied a term to the effect that the landlord was bound to keep the outside in reasonable repair, as the Recorder decided.
In that regard it is common ground that he directed himself correctly when he said:
"Clearly on the authorities the law does not permit the court to imply terms merely on the basis that implication would seem to be reasonable or fair. In essence, what is required before such implication is made is either a situation where the parties to the agreement, if asked about the suggested implied term would have said words such as 'Oh yes, of course we both agree. Is there any need to mention it?'; or where it is not merely desirable but necessary to imply such a term to give business efficacy or in other words necessary to make the contract workable, which amounts to the same thing."
Those two ways of putting the test as to whether or not a term should be implied, sometimes referred to as "the officious bystander test" and the "business efficacy test", are of course correct.
But whether or not, on applying those tests, the implication falls to be made is not easy, and the authorities are of no direct assistance.
The landlord relied strongly on a well-known passage in Woodfall on Landlord and Tenant, 28th Edition, paragraph 1 - 465 at page 618, in the following terms:
"In general, there is no implied covenant by the lessor of an unfurnished house or flat, or of land, that it is or shall be reasonably fit for habitation, occupation or cultivation, or for any other purpose for which it is let. No covenant is implied that the lessor will do any repairs whatever…."
The first was the old case of Hart v. Windsor in 1843, reported reported in 12 Meeson & Wellsby at page 68. There was a full tenant's repairing covenant of a house, but he declined to pay the rent because the house was bug-infested to such an extent that he said it was unfit for human habitation. That plea was rejected. Baron Parke, giving the judgment of the court, said at page 87:
"We are all of opinion that there is no contract, still less a condition, implied by law on the demise of real property only, that it is fit for the purpose for which it is let. The principles of the common law do not warrant such a position; and though, in the case of a dwellinghouse taken for habitation, there is no apparent injustice in inferring a...
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