Jafari v Tareem Ltd
| Jurisdiction | England & Wales |
| Judge | Mr Justice Nugee |
| Judgment Date | 25 October 2019 |
| Neutral Citation | [2019] EWHC 3119 (Ch) |
| Court | Chancery Division |
| Docket Number | No. CH-2019-000018 |
| Date | 25 October 2019 |
[2019] EWHC 3119 (Ch)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS
OF ENGLAND AND WALES
APPEALS (ChD)
On appeal from:
The County Court at Central London
HHJ Johns QC
Rolls Building
Fetter Lane
London, EC4A 1NL
Mr Justice Nugee
No. CH-2019-000018
Mr E. Francis (instructed by LCF Law) appeared on behalf of the Appellant.
Mr G. Blaker QC (instructed by SBP Solicitors) appeared on behalf of the Respondent.
INTRODUCTION
I have before me an appeal against an order of HHJ Johns QC, sitting in the County Court at Central London dated 28 December 2018 given after a five-day trial in an action between landlord and tenant. Permission to appeal was refused by the Judge but granted by me on 29 March 2019.
The tenant is Dr Jafari, a dentist. He is the appellant. In 2010, he bought a dentist's practice in Brighton for a substantial sum, about £800,000. As part of the acquisition, he took an assignment of the lease of the premises where the practice was carried on. This was a suite of rooms on what was called the first floor — although due to the sloping nature of the site was, in fact, more like a raised ground floor — of a building known as ‘Mitre House’ in Brighton. Mitre House occupies an island site between Western Road to the south and Hampton Street to the north, a little way north of the seafront. It consists of two blocks, the North Block and the South Block, and the present proceedings only concern the North Block. The premises acquired by Dr Jafari are on the north west corner of the site. They have their own entrance from a side street called Hampton Place. They are self-contained and do not communicate with rest of the North Block. They were demised by a lease dated 20 May 2002 for a term of 20 years from that date and so when assigned to Dr Jafari in March 2010, had some twelve years to run. The initial rent was £14,500 per annum, payable quarterly in advance on the usual quarter days. It was subject to five yearly upwards only rent reviews, the basis of review being “fair rack rent market value” and it was not disputed that the £14,500 represented a rack rent at the time of grant. There was, in fact, no review in 2007, so the rental was still £14,500 in 2010. The successive reviews at 2012 and 2017 have not been completed but are, I was told, outstanding.
The lease contained a number of covenants in the usual way among which was a covenant by the landlord for quiet enjoyment in fairly standard form. That was in clause 5.1 which reads as follows:
“5. THE LANDLORD COVENANTS with the Tenant as follows:
5.1 The Tenant paying the rents reserved and performing the Tenant's covenants in this Lease may lawfully and peaceably enjoy the Premises throughout the Term without interruption by the Landlord or by any person lawfully claiming through under or in trust for the Landlord or by title paramount”
No reliance was placed before me on any of the other terms of the lease.
By the time Dr Jafari acquired the lease, the reversion was vested in the respondent Tareem Limited (“Tareem”) which owned the whole of Mitre House. The remainder of the North Block had formerly been let as offices but Tareem decided to convert it to a 134-bedroom hotel. That was a substantial project including the stripping out of the existing building, the addition of a new fourth floor contained within a new mansard roof, and the creation of new bedrooms and the like for the hotel. It also included replacing all the windows and new rendering to the North and West facades. It did not involve any work to the interior of Dr Jafari's premises but it did involve work on the rest of the building adjacent to and above his premises; the erection of scaffolding encasing the exterior of his premises; a hoarding at ground floor level; and the erection of a new fire escape immediately adjacent to his premises.
Planning permission was granted on 7 February 2012. A contractor called Kilby & Gayford Limited (“K & G”) was engaged, scaffolding erected, and work started but in mid-April 2012 K & G went into administration and work came to a halt. The scaffolding was, however, left in place. A new contractor, HOC (UK) Limited (“HOC”) was engaged towards the end of January 2013. The work took most of 2013 to complete with the scaffolding struck in early August and practical completion on 5 November 2013.
In these proceedings, Dr Jafari complained about a number of aspects of the works that had been carried out and the impact that that had on his dental practice. I will have to look at some of the detail later but they included the way in which the scaffolding and hoarding obscured the entrance and made his premises look like a building site, the fact that rough sleepers used the entrance to his premises for sleeping and as a toilet, and the noise from the works going on around him. He blamed the cumulative effect of these and other matters for a significant downturn in the profitability of the practice. Tareem had waived the rent for the period of the works, that is for 7 successive quarters from March 2012 to December 2013, but rent became due again from the December 2013 quarter day. Dr Jafari, who by then was in dispute with Tareem, made some payments in January and July 2014 but otherwise stopped paying rent. That, in due course, led to Tareem issuing these proceedings for arrears of rent and service charge. The covenant to pay rent required payment without any set off. So although Dr Jafari had a counterclaim for damages, the Judge in due course gave judgment on the claim, the sum awarded being £79,279.14. There is no appeal against that part of his order and I need say no more about it.
The more significant dispute between the parties arose on Dr Jafari's counterclaim. This was a counterclaim for damages put on a number of bases but, most pertinently, for breach of the covenant for quiet enjoyment and for nuisance. There was a claim for the cost of certain remedial works and an unparticularised claim for general damages for discomfort, inconvenience, and loss of amenity, but the first head of damage, and by far the largest element of the claim, was for loss of profits, pleaded at over £450,000 for the years ending April 2013 to 2015 and continuing thereafter. Mr Gary Blaker QC, who appeared for Tareem, told me that there was some debate at the trial whether the quantum of the claim was about £0.5 million or more like £1 million but nothing now turns on it. It was, on any view, a substantial claim.
THE JUDGMENT
The Judge handed down a written reserved judgment dated 27 November 2018. After setting out the background and referring to the evidence he had heard, he dealt first with the counterclaim, starting with the question of what he called “interference”, that is whether there had been wrongful interference by Tareem with Dr Jafari's enjoyment of the premises. He recorded at [12] that:
“Both sides proceeded on the basis that there was no difference in the principles to be applied whether the case was framed in nuisance, breach of covenant for quiet enjoyment, or derogation from grant.”
He then referred to the principles as found in the decision of Mr Alan Steinfeld QC in Timothy Taylor Ltd v Mayfair House Corporation & Anor [2016] EWHC 1075 (Ch) (“ Timothy Taylor”). In essence, he held that the question was whether the landlord had taken all reasonable steps to minimise disturbance and that in considering that question, the court could take account of any financial compensation offered by the landlord to the tenant.
He then turned to the facts and made a number of factual findings. He dealt first at [20]–[34] with the question of noise from the works. He found that there was “frequent intrusive noise from heavy drilling and demolition work near the premises” in the period February to mid-April 2012 when the first contractor K & G was carrying out the works (see [21]). However, in the period when the second contractor, HOC, was carrying out the works, that is January 2013 to October/November 2013, there was an arrangement to restrict the hours during which the noisiest works would be carried out (see [23]) and he found that noisy work was generally done only during the restricted hours although there were “occasions when such work was done outside those hours though most of those occasions came towards the end of the works in around August 2013” (see [25]), giving a number of reasons drawn from the witness and documentary evidence for that conclusion (see [26]–[30]). There were some days near the end of March 2013 when noisy works were carried on outside restricted hours but this was short-lived and by 28 March, Dr Jafari's solicitors had sent a letter to Tareem threatening an injunction and that threat was taken seriously (see [31]). He concluded his section on noise at [34] as follows:
“I should spell out, before moving on, that in relation to my findings on noise, in referring to...
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Noisy Works: A Useful Reminder For Landlords
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Noisy works: a useful reminder for landlords
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