Joint London Holdings Ltd v Mount Cook Ltd; Mount Cook Ltd v Joint London Holdings Ltd and Another
| Jurisdiction | England & Wales |
| Judge | Mr Justice Etherton |
| Judgment Date | 07 October 2005 |
| Neutral Citation | [2005] EWCA Civ 1171 |
| Docket Number | Case No: A3/2005/0645 |
| Court | Court of Appeal (Civil Division) |
| Date | 07 October 2005 |
Lord Justice Chadwick
Lord Justice Jonathan Parker and
Mr Justice Etherton
Case No: A3/2005/0645
Mr Jonathan Small (instructed by Stephenson Harwood) for the Appellant
Mr Jeremy Cousins Q.C. and Mr Philip Kremen (instructed by Brecher Abram) for the Respondent
Introduction
These proceedings concern the meaning of a tenant's covenant in clause II(7) of a lease dated 18 September 1950 ("the Lease") prohibiting the carrying on of the business of a "victualler" or "coffee house keeper". Mr Justice Blackburne delivered judgment on 2 March 2005. The Defendant, who is also a Part 20 Claimant, has appealed with permission of the Judge. The Claimant, who is also a Part 20 Defendant, and the other Part 20 Defendant have cross-appealed.
The premises comprised in the Lease are situated at 41 and 42 Eastcastle Street and 2 and 3 Market Place, London, W1 ("the Property") . The Appellant, Mount Cook Land Limited ("Mount Cook") is the freeholder. One of the two Respondents, Joint London Holdings Limited ("JLHL") , is the tenant in occupation. The other Respondent to the appeal, Market Place Investments Limited ("MPIL") , is an intermediate tenant holding under the terms of a concurrent lease ("the Concurrent Lease") .
The litigation between the parties was prompted by the wish of JLHL to sublet the Property to Pret à Manger Limited ("Pret à Manger") for use as one of its typical outlets selling pre-prepared food, and hot and cold drinks, primarily for consumption off the Property, but also to some extent on the Property.
Blackburne J granted a declaration that use of the Property "as a shop for the sale of pre-prepared sandwiches, croissants, hot and cold non-alcoholic drinks and ancillary products exclusively for consumption off the premises would not constitute a breach of clause II(7) ". He granted further declarations that use of the Property as a shop for the sale of such food and drinks and ancillary products for consumption on the Property would be a breach clause II(7) , and would also be a breach of the Concurrent Lease.
Mount Cook appeals against the first of those declarations. JLHL and MPIL cross-appeal against the other declarations.
Background
When the site of the Property was first developed in the 1720s it formed part of the Cavendish-Harley Estate, which, as its ownership changed, became known as the Portland Estate and then the Howard de Walden Estate (together "the Estate") . In 1925 the Property, together with other parts of the Estate, was purchased by Sir John Reeves Ellerman, the shipping magnate.
The Lease was granted by Sir John Ellerman and three trust companies, as Lessors, to the Duke Family Trust Limited. The Lease was for a term of 125 years from 5 July 1950 at an annual rent of £400 throughout the term.
By Clause II(7) of the lease, the lessee covenanted:
"That (without the previous written consent which may be temporary or permanent, revocable or irrevocable or otherwise howsoever framed or qualified by the Lessors) there shall not be carried on or exercised in or upon any part of the said premises the trade business or calling of a Butcher Purveyor of Meat Slaughterman Fishmonger Tallow Chandler Melter of Tallow Soap Maker Tobacco Pipe Maker or Burner Smith Sugar Baker Fellmonger Dyer Distiller Farrier Blacksmith Common Brewer Coppersmith Working Brazier Pewterer Tinplate or Iron Plate Worker Cooper Tripe Boiler Tripe Seller Fried Fish Shop Coal Shed Keeper or Vendor of Coals Marine Store Dealer Rag or Fat Merchant Beater of Flax Auctioneer Victualler Vintner Tavern Keeper Vendor of Malt Liquor Restaurant or Coffee House Keeper Nursing Home Keeper Laundry Keeper Railway Parcel Booking Office Manufacturer of or Dealer in Motors or motor vehicles or hirer out or keeper of motors or motor vehicles Massage Manicure or other Medical or Surgical or quasi-Medical or quasi-Surgical Establishment or any of them or any noisome noisy or offensive trade or business or calling whatsoever or any trade or business involving the storage of electricity or oil or inflammable or explosive substances or any trade or business by reason whereof the annual premium for insurance of the said premises against loss or damage by fire according to the covenant for Insurance hereinbefore contained shall exceed Ten shillings and sixpence per centum or the rate of premium on any Policy of Insurance of any other premises of the Lessors may be liable to be increased and that the said premises shall not nor shall any part thereof at any time be used as a Brothel or disorderly house or for any illegal or immoral purpose or for any public exhibition or entertainment and that no sale by auction shall be held thereon."
On 16 January 1991 Mount Cook's then predecessor in title, Priest Marians (Langham Estate) Limited, granted the Concurrent Lease to MPIL for a term of 150 years from 25 December 1990. MPIL is an associated company of JLHL. The effect of the Concurrent Lease is that MPIL is interposed as intermediate tenant between Mount Cook as freeholder and JLHL as tenant until the expiry of the Lease in 2075.
By clause 5.4 of the Concurrent Lease MPIL covenanted:
"At all times during the Term to use the Demised Premises in accordance with the provisions for user in the Particulars and not to use the same or any part for any other purpose."
Paragraph 12 of the Particulars of the Concurrent Lease specifies the user as:
"Offices (other than as a betting office) and/or showrooms with ancillary stockrooms, storage and car parking in the basement".
Clause 2.3 of the Concurrent Lease provides that:
"Where any act is prohibited the Tenant shall not allow or suffer such act to be done".
By letter dated 17 October 2003 from Brecher Abram, JLHL's solicitors, to Stephenson Harwood, Mount Cook's solicitors, notice was given of the intention of JLHL to grant an underlease of the Property to Pret à Manger for occupation in the course of its business.
It is common ground that, as recorded in paragraph 2 of Mr Justice Blackburne's judgment, Pret à Manger operates retail outlets where pre-prepared and packaged sandwiches, snacks, salads and similar cold food, together with a variety of non-alcoholic drinks, including coffee, are displayed for sale, primary for consumption off the premises, but with limited facilities for consumption on the premises. Those outlets are self-service establishments, designed for a fast turnover of customers.
Mount Cook, in due course, through Stephenson Harwood, notified JLHL that it considered that the business conducted by Pret à Manger would be prohibited by Clause II (7) of the Lease and that it would object to the proposed user if the underletting to Pret à Manger were to take place.
On 3 June 2004 JLHL issued a Part 8 Claim Form claiming the following declarations:
"(i) the use of premises at 41 & 42 Eastcastle Street and 2 & 3 Market Place, London W1 ("the Premises") as a shop for the sale of pre-prepared sandwiches, croissants, hot and cold drinks and ancillary products for consumption off the Premises would not constitute a breach of clause II(7) of the lease of the Premises made on 18 th September 1950;
(ii) the use of premises at 41 & 42 Eastcastle Street and 2 & 3 Market Place, London W1 ("the Premises") as a shop for the sale of pre-prepared sandwiches, croissants hot and cold drinks and ancillary products for consumption off the premises, and for ancillary consumption on the Premises would not constitute a breach of clause II(7) of the lease of the Premises made on 18th September 1950."
It is to be noted that those declarations do not refer expressly to to Pret à Manger or the use of the Property as one of its outlets.
On 11 August 2004 Mount Cook issued a Claim Form under CPR Part 20 against JLHL and MPIL claiming against both of them a declaration that the use of the Property as a shop for the sale of pre-prepared sandwiches, croissants, hot and cold drinks and ancillary products for consumption on or off the Property would constitute a breach of Clause II (7) of the Lease, and, against MPIL, a declaration that such use would constitute a breach of clause 5.4 (read together with clause 2.3) of the Concurrent Lease.
It is common ground, as the Judge noted in his judgment, that, if use of the Property by Pret à Manger is not prohibited by clause II(7) , such use would not be a breach of the Concurrent Lease; but if such use is prohibited by clause II(7) , it would also be a breach of clause 5.4 of the Concurrent Lease (read together with clause 2.3)
The Trial
Witness statements by Harold Pasha, a director of JLHL, and Lucy Sarah Chester, a solicitor employed by Stephenson Harwood, Mount Cook's solicitors, were adduced in evidence at the trial. They were not called to give oral evidence.
Permission was given by Deputy Master Bartlett for each party to call oral expert evidence "as to the development of the phrase "Victualler Vintner Tavern Keeper Vendor of Malt Liquor Restaurant or Coffee House Keeper" and its meaning in 1950". Pursuant to that permission, evidence was given by way of written statements and oral evidence by Mr Victor Richard Belcher, an architectural and building historian, for JLHL, and by Mr Paul John Drury, a chartered surveyor, a Fellow of the Society of...
To continue reading
Request your trial