Mohammed v Gomez and Others
| Jurisdiction | UK Non-devolved |
| Judge | Lord Carnwath |
| Judgment Date | 19 December 2019 |
| Neutral Citation | [2019] UKPC 46 |
| Date | 19 December 2019 |
| Docket Number | Privy Council Appeal No 0019 of 2018 |
| Court | Privy Council |
[2019] UKPC 46
Lady Hale
Lord Wilson
Lord Carnwath
Lord Lloyd-Jones
Lady Arden
Privy Council Appeal No 0019 of 2018
Privy Council
Michaelmas Term
From the Court of Appeal of the Republic of Trinidad and Tobago
Appellant
Ian L Benjamin SC
Roger Kawalsingh
Pierre Rudder
(Instructed by Charles Russell Speechlys LLP)
Respondents
Ramesh L Maharaj SC
Robert Strang
(Instructed by BDB Pitmans LLP)
Heard on 22 October 2019
In this appeal the appellant, Ashmeed Mohammed, challenges the decision of the Court of Appeal, disagreeing with the trial judge, that the three respondents are entitled to equitable interests in the homes built and maintained by them on his property during the ownership of his predecessors.
The parties are all related and well-known to each other. They all live in Hillside Terrace, Maracas, St Joseph. The houses of the three respondents were built on three plots within a larger ten acre parcel of land owned by the appellant, who lives in another house in the same terrace. Their occupation of the plots goes back many years, dating respectively from 1966, 1958 and 1963. At that time the larger parcel was owned by Aziz and Elvina Andrews (“the Andrews” — also related by marriage to one of the respondents). In 1969 it was acquired by the appellant's father (Haniff Mohammed), and, following his death in 2004, it passed to the appellant in March 2012.
Before the respondents went into occupation the larger parcel was uncleared forest. Each claimed to have entered into possession on the basis of an agreement with the Andrews (“the Andrews agreements”) to the effect that: they would clear and develop the land, paying rent, and have the right to buy at market value assessed at the date of the agreements. There was no dispute that over the following years they had cleared the land, which included digging into some mountainous areas to create flat surfaces; and that they spent substantial amounts of money building, expanding and maintaining their homes (although there was some dispute as to the precise extent of the work and expenditure). There was also no dispute that they continued to pay rent to the Andrews and their successors until 2011, after which the appellant declined further payment, and in due course sought to recover possession. The respondents countered by commencing the present proceedings.
The Rent Restriction Act ( c 59:50) was in force from 1941 until 2002. It applied to various categories of building land, dwelling-houses and other buildings (section 3), and (by section 14(1)) restricted a landlord's right of possession to the cases there set out. Section 4 gave the President power by Order to exclude from its scope certain categories of premises. As from 12 February 1954 the Rent Restriction (Exclusion of Premises) Order (“the 1954 Order”) excluded from the protection of the Act all new buildings erected after that date “together with any land appurtenant thereto to be occupied therewith”.
On 1 June 1981, the Land Tenants (Security of Tenure) Act ( c 59:54) (“the 1981 Act”) came into force. The 1981 Act applied to tenancies of land on which a “chattel house” used as a dwelling was erected or in the process of being erected, and converted such tenancies into 30 year statutory leases, beginning on the day the 1981 Act came into force. “Chattel house” was defined as including —
“… a building erected by a tenant upon land comprised in his tenancy with the consent or acquiescence of the landlord and affixed to the land in such a way as to be incapable of being removed from its site without destruction;”
The tenants of such statutory leases had an option to renew the lease for a further 30 years, exercisable by notice before the end of the first 30 year term (section 4(3)) and an option to purchase the land, at a price not exceeding half the open market value of the land without the chattel house, exercisable at any time during the term of the lease (section 5(5)).
The background to the 1981 Act, which was designed to deal with the social problems arising from the proliferation of so-called “chattel houses”, was described by Lord Walker of Gestingthorpe ( Gopaul v Imam Baksh [2012] UKPC 1). He quoted the words of the Attorney General and Minister for Legal Affairs, Mr Richardson, in the House of Representatives introducing an earlier Bill (20 March 1981, cols 1808 and 1809):
“Everyone knows how widespread and deep-seated the practice of tenants building houses on the lands of their landlords has been in Trinidad and Tobago. It is as old as the abolition of slavery and the introduction of the indentured system in this country. With the progress of time, the movable one-room houses have given place to irremovable dwellings of steel and reinforced concrete, but the law has lagged behind, failing to catch up with and to reflect the realities of today.
Because of the affluence, instead of having chattel houses tenants started to build real solid houses, houses of concrete and steel and as such they continue to call them chattel houses. This problem is peculiar to Trinidad and Tobago, so peculiar so grave, that what we have to do today is literally to change the Constitution so that those tenants would benefit. To do this, we would have to pass this Bill by a three-fifths majority in both Houses of Parliament.”
It is common ground that the respondents' houses were within the scope of the 1981 Act when it came into force, and that accordingly (apart from any other rights) they were entitled to 30-year leases from 1 June 1981. They would also have been entitled to renew those leases by notices served before 1 June 2011, and to options to purchase during the course of their leases. This was in effect acknowledged in summer 2007 in an exchange of correspondence between lawyers for the second respondent and the appellant, but it does not seem to have been pursued at that time. There was no mention at that time of the Andrews agreements. At the trial the second respondent denied knowledge of this exchange, and the judge made no finding about it. In the event, no notices were served by any of the respondents within the time set by the 1981 Act, and accordingly their statutory rights under the 1981 Act lapsed.
On 20 June 2013 lawyers for the appellant wrote to each of the respondents informing them that, in default of notices, their tenancies under the 1981 Act had been determined, and that they were required to remove all structures and deliver vacant possession. On 12 November 2013 lawyers for the respondents replied claiming, first, that they were still tenants under the 1981 Act by virtue of oral notices of renewal, and, secondly, that they had entered and built their homes under the belief, induced by the appellant and his predecessors, that they would in future acquire the right to the plots. (At that stage there was no reference to any specific agreement or to the terms as to price.) On 22 July 2014 the respondents began the present proceedings claiming declarations that they were equitable owners of the three plots and other relief. The particulars of claim asserted that they had entered pursuant to the Andrew agreements, as mentioned above, including the right to buy their parcels at their open market value as undeveloped land, assessed at the date of the agreements.
The claim was dismissed by the judge (Jones J) who held in summary that the respondents' evidence lacked credibility, and there was a lack of other corroborative evidence, documentary or otherwise, to prove the existence of the Andrews agreements; that their expenditure and the permanence of their buildings, and the lack of objection by successive owners, were equally consistent with the protection provided by the 1981 Act and its predecessor, the Rent Restriction Act; and that the existence of the Andrews agreements, and in particular the alleged price, were inherently improbable.
The respondents appealed. On 26 April 2017, the Court of Appeal (Jamadar, Smith and Rajkumar JJA) unanimously allowed their appeals on the main issue. Rajkumar JA gave the only reasoned judgment. He held that the court was entitled to revisit the judge's findings of fact, since they had been based on a material misdirection as to the applicability of the Rent Restriction Act. The protection of the Act had been excluded by the 1954 Order, and accordingly did not provide an explanation for their decision to erect permanent structures on the land or the lack of objection by the owners. As to the inherent improbability of the alleged agreements, the judge should have separated out the undisputed from the improbable. While it was open to the judge to reject the agreement in the exact terms as alleged by the respondents, she had failed to give adequate weight to the undisputed evidence as to the erection of permanent structures and continuing expenditure, with the acquiescence of the Andrews and of the appellant's father.
He considered that the alternative case on estoppel by acquiescence was open on the pleadings, and did not stand or fall on the proof of the Andrews agreements in the terms alleged. Examining the facts, in their statutory and family context, there was sufficient material to support a finding of proprietary estoppel, which should be given effect by a remedy consistent with the position of tenants under the 1981 Act who had renewed their tenancies. The court declared that they were entitled to 15 year tenancies commencing 31 May 2011, with options to purchase at any time during the terms of their tenancies at half market value at that date.
On 30 October 2017 the Court of Appeal granted final leave to appeal.
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