Gilje v Charlegrove Securities Ltd
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE LAWS,LORD JUSTICE MUMMERY,LORD JUSTICE KENNEDY |
| Judgment Date | 04 October 2001 |
| Neutral Citation | [2001] EWCA Civ 1777 |
| Docket Number | No C/2000/2914 |
| Court | Court of Appeal (Civil Division) |
| Date | 04 October 2001 |
[2001] EWCA Civ 1777
IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM ORDER OF THE LANDS TRIBUNAL
(His Honour Judge Michael Rich QC)
APPEAL FROM ORDER OF HIS HONOUR JUDGE RICH QC
Royal Courts of Justice
Strand
London WC2
Lord Justice Kennedy
Lord Justice Mummery
Lord Justice Laws
No C/2000/2914
C/2000/3621
MR CHARLES HOLBECH (Instructed by Ellistons of London) appeared on behalf of the Appellant
MR T DUTTON (Instructed by Nicholson Graham Jones of London) appeared on behalf of the Respondent
In form, these are two appeals respectively from a decision given by His Honour Judge Rich QC in the CentralLondon County Court on 11th August 2000 and a decision of the same judge sitting in the Lands Tribunal on appeal from the Leasehold Valuation Tribunal given on 15th August 2000. Before us there is only one issue which was considered in both decisions. The issue concerned the liability or otherwise of underlessees of flats in the same block to pay service charges in respect of the rental value of the flat occupied by the caretaker who was employed by the landlord. We are faced with a bare question as to the true construction of the material provisions in the underleases. In the County Court below the judge granted declarations which favoured the construction put forward by the tenants. He refused permission to appeal in both sets of proceedings, but permission was granted by Lord Justice Pill on 26th August 2000.
The duality of the proceedings is explained by the fact that in the events which happened, there arose, it appears, some doubt as to the jurisdiction of the Leasehold Valuation Tribunal and hence the Lands Tribunal on appeal; and it was thought convenient to canvass the essential issues which fell for decision in the County Court.
It is helpful to go to the statement of agreed facts which is a useful document. It includes all the relevant terms of underleases including additional words appearing in the underleases of Flats 1 and 5 which do not appear in the underleases of Flats 3 and 4:
"1. The claimants are tenants of flats within 27 Lennox Gardens, London SW1 ("the property"). The property is a mid-terraced house comprising four floors plus basement. There are six flats within the property. Five flats are let on long underleases ("the leases"). The sixth flat is in the basement and is occupied by the caretaker.
2. The defendant holds the reversionary interest immediately expectant on the termination of the leases.
3. The leases are in substantially similar terms with some variations.
4. The leases contain, amongst others, the following clauses:
`4. The lessee hereby covenants with the lessor and with and for the benefit of the owners and lessees from time to time during the currency of the term granted of the other flats comprised in the building that the lessee will at all time hereafter during the said term:
….. (2) To pay to the lessor in each year a sum equal to twelve and one half per centum per annum of:
(i) All monies expended by the lessor in carrying out all or any of the works and providing the services and management and administration called for under clause 5 (4) ……
5. The lessor hereby covenants with the lessee as follows:
….. (4) That (subject to contribution and payment as herein before provided) the lessor will maintain, uphold and keep the building (other than the parts thereof to be maintain[ed] by the lessee or any other lessee of a flat in the building) in accordance with the obligations set out in the fourth schedule hereto.
….. The fourth schedule:
Costs, expenses, outgoings and matters in respect of which the lessee is to contribute:
[In the leases of Flats 1 and 5:]
….. 6. Expenses of management to include the proper and reasonable charges of any managing agents any legal and accountancy charges properly incurred in management and including the lessor's liability of whatsoever kind in relation to this lease and the costs of enforcing the covenants herein contained.'"
The equivalent provision in paragraph 6 of the fourth schedule in the cases of the leases of Flats 3 and 4 omits the words "the lessors liability of whatsoever kind in relation to this lease". Paragraph 8 of the fourth schedule is in these terms:
"`The lessor shall provide a resident housekeeper or porter to perform the services specified in the sixth schedule hereto provided that the lessor shall not be liable to damages for any omission on the part of such housekeeper or porter for any interruption to such services.'"
In paragraph 9 these words appear:
"`Gas, electricity, telephone, general and water rates and internal maintenance repairs of the flat occupied by the resident housekeeper or porter.'"
The sixth schedule is headed:
"`(Duties of Resident Housekeeper or Porter):
….. 4. To reside in the flat provided in the building and to be in attendance between the hours of 7 am and 12 noon and at such other times during the day as the lessor shall require or as may be found necessary for the proper fulfilment of these duties.'"
The agreed statement of facts proceeds to set out in some detail successive arrangements made between the appellant landlord and the residential caretaker. I will not replicate all the particulars. Essentially the position was as follows. Up to or at least for the year 1994–1995 the landlord paid a wage to the caretaker and provided the flat in the basement at no cost to him or her. The caretaker was obliged by contract to reside in the basement flat. Independent local surveyors had assessed the notional rental value of the caretaker's flat in 1993 at £150 per week. In 1994–1995 the claimant tenants were charged by way of service charge a total of £275 per week. That comprised £125 which was the caretaker's wage and £150 which was the notional rent of the caretaker's flat.
From 1995–1996 onwards the arrangements as between the landlord and the caretaker were altered. The caretaker remained obliged to reside in the basement flat but her salary was increased, on the face of it, to £328 a week and she agreed to pay £150 per week rent for the flat. She did not actually pay £150 or any rent; it was deducted from her wages as a book entry. That left £178 a week; £53 of that was accounted for by tax and national insurance which were also deducted. Thus her wage remained £125. After some tax items she received rather less. From 1995–1996 onwards the claimants were charged the whole £328.
Following, as I understand it, paragraph 74 of the decision of the Leasehold Valuation Tribunal, the landlords accept, as they did before Judge Rich, that they are not entitled to recover the £53. In the result the claim by the landlord against the tenants was, in money terms, the same in 1995–1996 as it had been in 1994–1995 -£125 plus £150. I should read paragraphs 16 to 18 of the agreed statement of facts:
"16. The purpose of the above arrangement"
I interpolate, that is the arrangement as between the landlord and the caretaker which I have just described,
"was to enable the defendant to recover a rent for the caretaker's flat through the service charge as a rent payable by the caretaker out of the caretaker's wages, rather than as a notional rent payable directly by the tenants. The defendant is entitled to recover caretaker's wages, through the service charge, pursuant to paragraph 8 of the fourth schedule of the leases, subject to the Court's determination as to reasonableness, pursuant to section 19 (2A) of the Landlord and Tenant Act 1985.
17. A rent of £150 per week, if properly chargeable, is a reasonable rent for the caretaker's flat.
18. A wage of £125 per week is a reasonable rent for the caretaker."
The tenants' essential case is, as it was before the judge, that they are not obliged to make payments in respect of the notional cost to the landlord of providing accommodation to the caretaker whether in respect of the 1994–1995 arrangements or the later arrangements. Whether that case is good is the issue we have to decide. The judge held that the tenants' liability to contribute to the notional rent on the caretaker's flat depended on whether the notional rent fell within Schedule 4 paragraph 8 of the underleases. This is what he said:
"In my judgment, the scope of the covenant in clause 4 (2) to pay a proportion of the money expended in providing the services called for under clause 5 (4), must be determined by reference to the scope of the services to which schedule 4 contemplates contribution, and a restrictive construction by reference to grammatical construction or the dictionary definition of the words of either clause 4 ( 2) or 5 (4) is not appropriate."
I agree with the judge to this extent. Plainly, paragraph 4 (2) looks forward to paragraph 5 (4) which, in turn, looks forward to Schedule 4. The...
To continue reading
Request your trial
-
Ian Morris v Blackpool Borough Council and Another
...interpretation. Accordingly the presumption never comes into play. The case relied upon by Mr Knox in this context, namely Gilje v Charlgrove Securities Ltd [2002] L& TR 33, is distinguishable on its facts. In that case the Court of Appeal applied that presumption to the question of whether......
-
Decision Nº LRX 16 2013. Upper Tribunal (Lands Chamber), 28-05-2014
...Borough of Camden [2011] UKUT 336 (LC) London Borough of Brent v Shulem B Association Limited [2011] EWHC 1663 (Ch) Gilje v Charlgrove [2000] 3 EGLR 89 Longmint v Marcus [2004] 3 EGLR 171 Joseph v Joseph [1967] Ch 78 DECISION The lease of a dwelling provides for the tenant to pay a fair app......
- McHale and Another v The Right Honorable Charles Gerald Earl Cadogan
-
Mchale v The Rt Hon Charles Gerald John Earl Cadogan
...was that its presence was not strictly necessary. I can derive no assistance from that case. 16 Mr Radevsky also relied on Gilje v. Charlgrove Securities Ltd [2002] 1 EGLR 41 (CA), where this court dismissed a landlord's appeal against a decision that it could not recover notional rent for ......