Lester v Ridd
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE DILLON,LORD JUSTICE STAUGHTON,LORD JUSTICE SLADE |
| Judgment Date | 20 December 1988 |
| Judgment citation (vLex) | [1988] EWCA Civ J1220-1 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | 88/1122 |
| Date | 20 December 1988 |
[1988] EWCA Civ J1220-1
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL. CIVIL DIVISION
ON APPEAL FROM THE TAUNTON COUNTY COURT
MR ASSISTANT RECORDER LAITY
Royal Courts of Justice
Lord Justice Slade
Lord Justice Dillon
Lord Justice Staughton
88/1122
Case No. 8601844
SIR ASHLEY BRAMALL (instructed by Messrs Clarke Willmott & Clarke) appeared on behalf of the appellants.
MR STEPHEN LOWRIE (instructed by Messrs Hole & Pugsley) appeared on behalf of the respondent.
This appeal from a decision of Mr Assistant Recorder Laity given in the Taunton County Court on the 7th December 1987, raises a novel point which, despite the admirably clear reserved judgment of the learned Recorder, I have found very difficult.
On the 13th December 1982 the appellants, Mr and Mrs Lester, purchased the leasehold interest in a house now known as Glebe House at Oare in Somerset, and two acres of surrounding land. From the date of purchase they occupied the house as their residence, and by the originating application in these proceedings issued on the 25th February 1986, they claimed a declaration that they were entitled to acquire the freehold of the house and land thus assigned to them, under the Leasehold Reform Act 1967, as amended. The requisite notice of their desire to have the freehold had been given on the 23rd December 1985 to the respondent, Mr John Ridd, who is the owner of the freehold.
Section 1 (1) of the 1967 Act, as amended, confers the right to acquire the freehold, subject to certain conditions which are not in issue in the present case, when at the time he gives notice of his desire to have the freehold, the tenant has been "occupying [the house] as his residence" for the last three years. That is qualified, however, by section 1 (3), which provides, so far as material:
"(3) This part of this Act shall not confer on the tenant of a house any right by reference to his occupation of it as his residence (but shall apply as if he were not so occupying it) at any time when—
(b) it is comprised in an agricultural holding within the meaning of the Agricultural Holdings Act 1948".
The question, therefore, in the present case is whether during the time from the assignment of the leasehold interest in it to the appellants, to the time when they gave their notice of their desire to have the freehold, Glebe House was comprised in an agricultural holding. The learned Recorder held that it was so comprised, and that the appellants were therefore not entitled to acquire the freehold (because as a result of section 1 (3) they were to be treated as not having occupied Glebe House as their residence for the 3 years qualifying period); that is the decision against which the appellants now appeal.
The Agricultural Holdings Act 1948, which is referred to in section 1 (3) (b) of the 1967 Act, was amended by the Agricultural Holdings Act 1984, and both have since been repealed by the present Act, the Agricultural Holdings Act 1986, which is a consolidating Act, but was only enacted after these proceedings had been commenced. Counsel were agreed, however, and we accept, that it is convenient to look at the provisions of the 1986 Act since in relation to what is "comprised in an agricultural holding" these provisions concisely set out the effect of the corresponding provisions of the Agricultural Holdings Act 1948 as intepreted by the courts. Before I turn, however, to the provisions of the 1986 Act, it is convenient to set out the facts.
By a Lease of the 17th January 1902 Glebe House and the two acres subsequently assigned to the appellants were demised as part of a larger area of some 23 acres of former glebe land by the then owner Thomas Ridd (a lineal ancestor of the present respondent) to one Lethaby for a term of 99 years from the 25th December 1901 at a yearly rent of £9 payable quarterly. Glebe House is described as a house in the course of erection on the land. The Lease seems to have been a building lease, and, not surprisingly in the case of a lease for a long term at a ground rent (though contrary to the modern practice with agricultural tenancies) it did not contain any restriction on assignment. It merely contained a covenant that upon any assignment of the demised premises or any part thereof, notice of the assignment would be given to the lessor.
The Lease also includes a covenant by the lessee not without the consent in writing of the lessor to carry on any trade or business upon any part of the demised premises. It is, however, common ground that, notwithstanding this covenant, the demised premises were for very many years up to at least 1963 used for agriculture by way of trade or business.
It is sufficient to pick up the devolution of the leasehold title under the Lease in 1955, when by a Deed of the 7th December 1955 all the lands and premises comprised in the Lease were assigned for the full unexpired residue of the term of the Lease to Alfred John Burge and William John Burge. They were father and son, and both were farmers; they carried on farming in partnership together under the style of A.J. Burge and Son, and the lands and premises so assigned to them were to be held as part of their partnership property. Their partnership was dissolved, however, on the 16th December 1963, with effect from the 5th April 1962, and by a Deed of Partition of the 16th December 1963 Glebe House and the two acres subsequently assigned to the appellants were assigned to A.J. Burge for the unexpired residue of the term of the Lease at a yearly rent of £5 while the rest of the land comprised in the Lease, viz. approximately 18 acres, was assigned to W.J. Burge for the unexpired residue of the term at the yearly rent of £4. The assignment to the appellants on the 13th December 1982 of Glebe House and the 2 acres was made by the executors of A.J. Burge, who had died on the 1st August 1981.
In fact it was not until after the assignment to the appellants that the landlord learned of the partition effected between A.J. Burge and W.J. Burge in December 1963. The ground rent had presumably continued to be paid by some member of the Burge family without anyone particularly worrying which. It seems that A.J. Burge occupied Glebe House from 1955 or thereabouts until soon after 1963, when he moved elsewhere. Glebe House and the 2 acres were then let to a Mr Stevens, who farmed other lands; at this stage Glebe House was known as Glebe Farm. Mr Stevens died in May 1979, and Glebe House and the 2 acres were then let to Philip Burge, a grandson of A.J. Burge and one of the two sons of W.J. Burge. Philip Burge was also a farmer and, like his brother, in partnership with W.J. Burge in farming various Burge farming lands.
Against this background, the relevant provisions of the Agricultural Holdings Act 1986, which are all contained in section 1, are as follows:
"1 (1) In this Act 'agricultural holding' means the aggregate of the land (whether agricultural land or not) comprised in a contract of tenancy which is a contract for an agricultural tenancy……
(2) For the purpose of this section, a contract of tenancy relating to any land is a contract for an agricultural tenancy if having regard to,
(a) the term of the tenancy,
(b) the actual or contemplated use of the land at the time of the conclusion of the contract and subsequently and
(c) any other relevant circumstances, the whole of the land comprised in the contract, subject to such exceptions only as do not substantially affect the character of the tenancy is let for use as agricultural land.
(3) A change in use of the land concerned subsequent to the conclusion of a contract of tenancy which involves any breach of the terms of the tenancy shall be disregarded for the purpose of determining whether a contract which was not originally a contract for an agricultural tenancy has subsequently become one unless it is effected with the landlords' permission, consent or acquiescence.
(4) In this Act 'agricultural land' means—
(a) Land used for agriculture which is so used for the purpose of a trade or business…..
(5) In this Act 'contract of tenancy' means a letting of land or agreement for letting land for a term of years or from year to year….."
Since, despite the covenant against trade or business use in the 1901 Lease, the use of the land comprised in that Lease as "agricultural land" as defined in subsection (4) was plainly acquiesced in by the landlord, it must follow, in the light of subsection (3) that even if the letting of the land under the 1901 Lease was not originally a contract for an agricultural tenancy, it had become one well before the 1963 partition.
The wording used in subsection (2) "if…the whole of the land comprised in the contract, subject to such exceptions only as do not substantially affect the character of the tenancy is let for use as agricultural land" reflects the interpretation put on the wording of the 1948 Act by this court in Howkins v. Jardine (1951) 1 K.B. 614 where Jenkins L.J. said at page 628: 'one must look at the substance of the matter and see whether as a matter of substance, the land comprised in the tenancy, taken as a whole, is an agricultural holding. If it is, then the whole of it is entitled to the protection of the Act. If it is not, then none of it is entitled! In that case there had been an agricultural tenancy of some land and three cottages but the cottages were subsequently sublet to persons not engaged in agriculture. It was argued that for the purposes of the 1948 Act there must be deemed to have been a partition of the tenancy as between agricultural and non-agricultural property, so that...
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