Metropolitan Properties Company (F.G.C.) Ltd v Lannon

JurisdictionEngland & Wales
JudgeTHE MASTER OF THE ROLLS,LORD JUSTICE DANCKWERTS
Judgment Date11 July 1968
Judgment citation (vLex)[1968] EWCA Civ J0711-2
Date11 July 1968
CourtCourt of Appeal (Civil Division)

In the Matter of the Rent Act, 1965 and

In the Matter of the Tribunals and Inquiries Acts 1958 to 1966 and the Tribunals and Inquiries (Rent Assessment Committee) Order 1965 (S.I. 1965 No. 2151) and

In the Matter of a Decision of John Lannon, Eric Trothan and Margaret Cockburn members of a Committee of The London Rent Assessment Panel given on 26th April 1967

and

In the Matter of Flats 31, 60A and 61 Oakwood Court, London W.14

Between
Metropolitan Properties Company (F.G.C.) Limited
Appellants
and
Richard Kitzinger and W.F. Holmes (Male) and C.J. Zenker (Male)
Respondents

[1968] EWCA Civ J0711-2

Before

The Master Of The Rolls (Lord Denning)

Lord Justice Danckwerts and

Lord Justice Edmund Davies

In The Supreme Court of Judicature

Court of Appeal

Mr. F. LAYFIELD, Q.C., and Mr. S. RICH (instructed by Messrs. Grangewood Allan & Co.) appeared on behalf of the Appellants.

Mr. G. SLYNN (instructed by the solicitor, ministry of Housing) appeared of behalf of the Tribunal on the certiorari proceedings and as adieus curiae on the statutory appeal.

Mr ASHLEY BRAFALI (instructed by Messrs. Kenneth Brown Baker Baker) appeared on behalf of Mr. Zenker.

Mr KITZINGER appeared in person.

THE MASTER OF THE ROLLS
1

This case is brought to determine the rents of the flats in Oakwood Court, West Kensington. It is concerned particularly with three flats in a block built 40 years ago, namely, Nos. 31, 60A and 6l Oakwood Court. Once the rents of those three flats are determined, they will form a guide in determining the rents, not only of the other flats in Oakwood Court, but also of numerous flats in the neighbourhood. They may also be used as a comparison in determining the rents of other flats in different areas of London.

2

The procedure for determining rents is laid down by the Rent Act of 1965. The Rent Officer for the area first determines a fair rent. He is usually a valuer appointed by the local authority. If either party objects to his figure, he can appeal to the Rent Assessment Committee. This is a Committee which consists of a lawyer member (who is Chairman), a valuer member, and a lay member. The Bent Officer is thus a tribunal of first instance. The Rent Assessment Committee is an appeal tribunal.

3

Oakwood Court used to be owned by an insurance company, but in February 1966 it was bought by metropolitan F.G.C. Ltd., which is one of the Freshwater Group of Companies, That Group owns a great number of blocks of flats in London, usually through wholly-owned subsidiaries. So much 30 that the "landlords of all these blocks are regarded as the "Freshwater Group". That is the name they use themselves and the name by which they are generally known.

4

Soon after the Freshwater Group took over Oakwood Court they proposed to increase the rents of the flats. Some of the tenants applied to the Rent Officer to register a "fair rent under the Rent Act of 1965. These were the tenants of Nos. 31, 60A and 61 Oakwood Court. The Rent Officer fixed what he thought were fair rents. The Freshwater Group appealed to the Rent Assessment Committee. That Committee made drastic reductions in the rents. They put the fair rent at figures which were far lower than the contractual rents, far lower then any of the experts stated, and lower, indeed, than the tenantsthemselves had offered. The tenants were, no doubt, much gratified by the result. But the Freshwater Group took the case to the Divisional Court. At first the Freshwater Group complained only that the Rent Assessment Committee had gone wrong in point of law in various respects. But later on they found out other facts and made a complaint against Mr. John Lannon, the Chairman of the Rent Assessment Committee. They alleged that he was disqualified. He could not have given them, they said, an unbiased hearing. He was a solicitor living in another block of flats owned by the Freshwater Group. It was Regency Lodge, Swiss Cottage, owned by Avenue (Properties) (St, John's Wood) Ltd., which was a wholly-owned subsidiary of the freshwater Group. The flat in which the Chairman lived was No. 55 Regency Lodge. His father was the tenant and was in dispute with the Freshwater Group. The Freshwater Group say that the son was assisting and advising his father in that dispute, and he did so at or about the time when he was about to sit as Chairman of the Rent Assessment Committee. On that account the son, they said, ought not to have sat on the flats in Oakwood Court: and they were confirmed in their view by the "startling" decision to which the Committee came. This complaint needs careful consideration.

5

Mr. JOHN LANNON'S POSITION.

6

The Rent Act of 1965 was passed on the 8th November, 1965. Whilst the Bill was going through Parliament, the tenants of Regency Lodge (where Mr. John Lannon lived) were interested in it. Mr. Lannon attended and addressed several meetings of the tenants, The intention was to inform the tenants what their legal position was likely to be under the new law. There was a proposal to form a tenants' association to represent the views of the tenants, but no officers were appointed, and no such association was actually formed. No doubt at that time (whilst the Bill was still before Parliament) Mr. Lannon had no idea that he was likely to be appointed Chairman of a Rent Assessment Committee, So there was nothing wrong in hisaddressing meetings of the tenants.

7

On the 10th May, 1966, the Lord Chancellor appointed Mr. Lannon to be one of the panel of lawyer members. He was appointed for the Registration Areas comprising the areas of the London Boroughs and of the Common Council of the City of London. From that moment onwards, he became eligible, as I understand it, to sit as Chairman of any of the Rent Assessment Committees for thotre areas of London, on appeal from Rent Officers.

8

After he was appointed to the panel, Mr. Lannon's firm acted for some of the tenants in Regency Lodge in their negotiations with the Freshwater Group. I presume that Mr. John Lannon himself conducted the negotiations, for he did not state the contrary. These negotiations fell into two categories: (1) In some cases his fire agreed new rents with the landlords {the Freshwater Group) without resort to the Rent Officer; (2) In two cases, Nos. 82 and 93 Regency Lodge, the firm made representations to the Rent Officer, putting forward arguments on behalf of the tenants, such as "The scarcity value is not now relevant", and so forth.

9

In addition, after he was appointed to the panel, Mr. John Lannon assisted his father in his dealings with the landlords (the Freshwater Group) about the rent of the flat No, 55 Regency Lodge. We do not know the extent of his assistance except in so far as it is to be inferred from (a) a letter of the 31st August, 1966, in which his father proposed a yearly rental of £700, after being "advised that the suggested rental of £850 per annum exclusive was excessive"; (b) a letter of the 13th January, 1967, to the Rent Officer, which the son assisted the father to prepare, and of which the son kept a draft on his files. It took up the father's case strongly against the Freshwater Group. It was not before the Divisional Court, and I think it necessary to set out some of it:- "To the Rent Officers:

10

"1. The address of the property is exaggerated" to include the words "Avenue Road, St. John's Wood, N.U.8". None of these is correct, but are presumably used to impress you that theproperty is situate in a higher class area than is the fact….

11

"2. The impression say be given you that there is more than one night porter. If so, this is incorrect. There are no amenities by way of outlook…… the Blue Star Garage is open twenty-four hours a day, with the consequent noise of vehicles accelerating up a steep ramp, motorists hooting for attention and doors and bonnets slamming ……

12

"9. This (the rent) is excessive. The present rental when fixed included rates of £118 and the basic figure was, therefore, £607 exclusive. This was a market rental of the kind and included a substantial element of scarcity. Had this not been taken into account, it is suggested that the true market value at that time would have been £500 exclusive. Allowing for normal increases during the intervening period, it is submitted that the proper figure is now £660 exclusive.

13

It is remarkable how that letter came to light. The Freshwater Group made their complaint against Mr. Lannon in an affidavit of the 18th July, 1967, referring to his father's difference with the Group. Mr. John Lannon took four months to reply to this affidavit, and then he swore an affidavit in which he said:" I have not been in any way acting for or advising my father in this connection." But a week later, on the 17th November, 1967, he said this was an error. He said: "On looking through my papers, I have come across a draft letter from my father to the Rent Officer, the presence of which on my files indicates that I must have assisted my father in the preparation of his representation. I wish to express my sincere regret for the error."

14

Now that the letter is before us, it is plain that Mr. John Lannon was assisting his father in a dispute with his landlords, the Freshwater Group. He was putting before the Rent Officer (who was the Tribunal of first instance) the case of the tenant against the landlords. That dispute was still pending when six days later Mr. John Lannon sat as Chairman in the dispute about Oakwood Court - to which the same landlords, the FreshwaterGroup, were parties. In that dispute the tenants were making against the Freshwater Group similar joints to those which the father was making against them. Mr. John Lannon was one of the panel of Chairmen hearing appeals from Rent Officers. Yet he was putting representations before Rent Officers who decided cases at first instance.

15

THE REARING AND THE DECISION.

16

I have pointed out that, on Friday, the 13th...

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