Brighton and Hove City Council v Collinson and another
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE BROOKE,LORD JUSTICE JACOB,SIR MARTIN NOURSE |
| Judgment Date | 12 May 2004 |
| Neutral Citation | [2004] EWCA Civ 678 |
| Date | 12 May 2004 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | B2/2004/0264 |
[2004] EWCA Civ 678
IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM BRIGHTON & HOVE CITY COUNCIL
(HIS HONOUR JUDGE KENNEDY QC)
Royal Courts of Justice
Strand
London, WC2
Lord Justice Brooke
(Vice President of The Court of Appeal, Civil Division)
Lord Justice Jacob
Sir Martin Nourse
B2/2004/0264
MR GUY FETHERSTONHAUGH QC AND MR SIMON SINNATT (instructed by BRIGHTON & HOVE LEGAL SERVICES, HOVE BN3 25B) appeared on behalf of the Appellant
MR DANIEL GATTY (instructed by MULLIS AND PEAKE SOLICITORS, ESSEX RM1 3PJ) appeared on behalf of the Respondents
I invite Jacob LJ to give the first judgment.
This is an appeal by Brighton and Hove City Council from a decision of HHJ Kennedy QC given on 15th January 2004. The appeal is by permission from Auld LJ.
The Council are the landlords of a property consisting of part of the King Alfred Leisure Centre in Hove. The tenants are the respondents, the Collinson brothers. The Collinson brothers are directors of a company called Galaxi 3 Limited. The lease, the subject of this dispute, was granted in 1995, on 8th March. It contains the following recital, after reciting the names of the parties:
"HAVING BEEN AUTHORISED to do so by an Order of the Brighton County Court dated 11 June 1993 the Council and the Lessee agree to exclude the provisions of Sections 24–28 of the Landlord and Tenant Act 1954 in relation to the tenancy created by this Lease."
Shortly before the lease came to the end of its term, which I think was not quite ten years, the Collinsons indicated to the Council that they desired a new lease and contended that the recital in the lease about the order of the Brighton County Court was of no effect. That is indeed their principal point, namely that there has never been any contracting out of the provisions of the Landlord and Tenant Act 1954 ("the Act") authorised by the court.
Section 38 of the Act provides, as amended:
"(1) Any agreement relating to a tenancy to which this Part of this Act applies (whether contained in the instrument creating the tenancy or not) shall be void [(except as provided by subsection (4) of this section) ] in so far as it purports to preclude the tenant from making an application or request under this Part of this Act or provides for the termination or the surrender of the tenancy in the event of his making such an application or request or for the imposition of any penalty or disability on the tenant in that event.
…
[(4) The court may-
(a) on the joint application of the persons who will be the landlord and the tenant in relation to a tenancy to be granted for a term of years certain which will be a tenancy to which this Part of this Act applies, authorise an agreement excluding in relation to that tenancy the provisions of sections 24 to 28 of this Act; and
(b) …
if the agreement is contained in or endorsed on the instrument creating the tenancy or such other instrument as the court may specify; and an agreement contained in or endorsed on an instrument in pursuance of an authorisation given under this subsection shall be valid notwithstanding anything in the preceding provisions of this section.]"
The events leading up to the grant of the lease were as follows. Back in September 1992 the Council had entered into negotiations with the company, Galaxi 3, through Mr Martin Collinson. On 9th September the Council wrote a letter indicating that it would grant a lease. The letter included the following passage:
"To safeguard the Council's position in connection with the future use and development of the King Alfred Leisure Centre it is intended that security of tenure under Part II of the Landlord and Tenant Act 1954 will be excluded and this will involve both parties making appropriate applications to the County Court. The entire scheme is subject to the Court issuing the appropriate exclusion order."
The solicitors for Galaxi 3 replied on 16th September asking as follows:
"We note that you seek to exclude the renewal provisions of the 1954 Act. Would it not be the case that the Council would only be likely to oppose renewal of a Lease if the Council had in mind using the premises for its own activities? In this situation would it not be in order for the 1954 Act to apply in the usual way? We look forward to hearing you on this point."
The Council's reply on 18th September said this:
"It is this Council's firm policy when leasing its commercial premises in the leisure field, usually along or near to the Hove seafront, to insist upon the exclusion of protection under the Act. That policy appears to have been recognised by the Court in issuing appropriate Orders when requested by my Council. I cannot say on which grounds the Council might wish to oppose any renewal of the proposed Lease, if indeed the Council would object at all at the given time. This point is not really open to discussion."
There was then no more debate about whether there should be exclusion or not. The administrative arrangements to make the application to the court went through. A draft lease was prepared in which Galaxi 3 were the tenants and the two Collinson brothers were the guarantors.
An application was made to the court. The plaintiffs were Galaxi 3 Limited and the two brothers. The application form said this:
"We, HOVE BOROUGH COUNCIL…and GALAXI 3 LIMITED…and DAVID JOHN COLLINSON and MARTIN ARTHUR COLLINSON…apply to the court for an order under s 38 of the said Act…authorising the inclusion in a lease to be made between the said HOVE BOROUGH COUNCIL…and GALAXI 3 LIMITED as lessee…and [the Collinsons] as sureties of the [identified premises] …
The grounds upon which we claim to be entitled to the order are:
…
2. The said Galaxi 3 Limited and [the Collinson brothers] are desirous of entering into a lease of the said premises for a period of 10 years for the purposes of providing a Laser Gun game at the King Alfred Leisure Centre and the Council wish to reserve the right to use the premises at the end of the period for its own use."
A draft of the proposed lease was annexed. The court made an order in the usual way which is described in the notes to the White Book at paragraph 56.2.1 as "rubber stamping".
The order said as follows:
"BY CONSENT
IT IS ORDERED that the Court doth authorise the grant of a Lease by the Applicant to the Respondents in respect of part of the premises known as:-"
And they are there identified:
"which will exclude the provisions of Sections 24–28 of the Landlord and Tenant Act 1954."
Subsequent to the court order the Collinson's solicitors wrote, after some delay which is unexplained and does not matter, on 9th March 1994 saying as follows:
"Furthermore, and following advice from their accounts, our clients have indicated that they would prefer to complete the Lease in the personal names of David Collinson and his brother Martin Collinson. Before we give consideration to the necessary amendments arising from such a change, we should be grateful if you would confirm in principal as to whether or not your authority would have any objection to the matter concluding in this manner."
There appears to have been a telephone call and there is a second letter from the Collinson's solicitors saying, on 28th March 1994:
"You have indicated that there is no objection to these being taken in the personal names of Messrs. Martin and David Collinson and we therefore await the documentation to enable the matter to be concluded as soon as possible."
The Council then asked the Collinson's...
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