Pearlman v Keepers and Governors of Harrow School
| Jurisdiction | England & Wales |
| Judge | THE MASTER OF THE ROLLS,LORD JUSTICE GEOFFREY LANE,LORD JUSTICE EVELEIGH |
| Judgment Date | 14 July 1978 |
| Judgment citation (vLex) | [1978] EWCA Civ J0714-1 |
| Date | 14 July 1978 |
| Court | Court of Appeal (Civil Division) |
In the Matter of an Application by SIDNEY PEARLMAN for leave to apply for an order of certiorari
And in the Matter of an Action in the Bloomsbury and Marylebone County Court between Sidney Pearlman and the Keepers and Governors of the Goods, Revenues and Possessions of the Free Grammar School of John Lyon in the Town of Harrow-on-the-Hill in Greater London (known as the Keepers and Governors of Harrow School.)
[1978] EWCA Civ J0714-1
The Master of the Rolls
(Lord Denning.)
Lord Justice Geoffrey Lane and
Lord Justice Eveleigh
In The Supreme Court of Judicature
Court of Appeal
On Appeal from the High Court of Justice
Queen's Bench Division
Divisional Court
MR. L. READ, Q.C. and MR. M. HORTON (instructed by Messrs. Enever Freeman & Co., Solicitors, Ruisllp) appeared on behalf of the Appellant.
MR. A. DAWSON, Q.C. and MR. J. HARPER (instructed by Messrs. Fladgate & Co., Solicitors, London) appeared on behalf of the Respondents.
The Leasehold Reform Act, 1967, conferred a great benefit on some tenants. They were tenants who resided in houses which they held on long leases at a low rent. It gave them a right to acquire the freehold on very favourable terms. But it did not apply to large houses. In the London area it only applied to houses of a rateable value of not more than £400. Later on the valuation lists were reviewed, and all rateable values were much increased. By an amendment the Act was extended so as to apply in the London area to houses of a rateable value of not more than £1,500 - see section 118 of the Housing Act, 1974.
Now there are many houses in the London area where the tenants have done improvements to the property at their own cost: and the rateable value has been increased on that account. The house might be assessed at over £1,500 just because of the tenant's improvements. Parliament realised that it was very unfair on a tenant that he should be deprived of the benefit of the Leasehold Reform Act simply by reason of improvements which he himself had made. So in the Housing Act 1974 Parliament inserted provisions enabling the tenant in such a case to get the rateable value reduced for the purpose of the Leasehold Reform Act. These provisions are section 118(3) and Schedule 8 of the Act.
The procedure is for the tenant to serve a notice on the landlord saying that he made the improvements at his own cost and wants the rateable value reduced. The landlord may agree. But if he disagrees, the matter is referred to the county court judge. He has to determine whether the tenant has a legitimate case for a reduction: but he does not determine the quantum of it. That is to be referred to the valuation officer for him to certify the amount of the reduction.
THE HOUSE AND THE IMPROVEMENTS
The house is No. 1, Vale Close, Maida Vale, London, W.9. It is a good-sized house with three floors. It is owned by the Governors of Harrow School. They let it in 1935 on a long lease for 88 years. So that it is due to expire in the year 2021 A.D. The leaseholder is Mr. Sidney Pearlman, who has occupied it as his residence for over 30 years. When he went there it had an old-fashioned heating system. There was a coal-fired boiler in the kitchen. It supplied hot water for the sinks and baths: and two radiators, one in the hall and the other on the first-floor landing. The rooms in the house were heated by ordinary coal fires.
In the year 1960 Mr. Pearlman scrapped that system. He installed a modern full central-heating system. It supplied 18 radiators and towel-rails all over the house. It supplied hot water to baths, sinks, and so forth. It was fired with gas. The boiler was in the kitchen. It was connected with the flue and the chimney, There was asbestos lining inserted right up the chimney. Pipes were laid from the boiler on the ground floor up to the top floor, passing under floors and through ceilings and walls, some of them load-bearing, from room to room right up to a metal tank in the roof space. Holes had to be made in the ceilings and walls and made good afterwards. Each radiator was connected to the walls with brackets. In 1971 Mr. Pearlmen had two more radiators installed.
That work undoubtedly was a great improvement to the house and went to increase its rateable value. In the latest revaluation the rateable value of the house was £1,597. This was over £1,500 and, as things stood, Mr. Pearlman was unable to claim the benefit of the Leasehold Reform Act, 1967: because that was limited to houses in London of less than £1,500 rateablevalue. In the circumstances, Mr. Pearlman applied to his landlords asking them to agree to a reduction in the rateable value. He proposed that the rateable value should be reduced to £1,487. He said that, by installing the full central heating system, he had himself made improvements - increasing the rateable value - and that that increase should not count against him for the purposes of the Leasehold Reform Act, 1967.
The landlords did not agree. So Mr. Pearlman applied to the county court judge. On 26th November, 1976, the judge refused Mr. Pearlman's request. Mr. Pearlman says that the determination of the judge was wrong in law.
THE LAW
In order to qualify for a reduction, the improvement must be an "improvement made by the execution of works amounting to structural alteration, extension or addition".
Those are the words of the Housing Act, 1974, Schedule 8, paragraph 1(2). They are simple English words, but they have been interpreted by different judges differently. At any rate, when the judges have had to apply them to the installation of a full central heating system. In each house the primary facts have been exactly the same, or near enough the same, but one judge has found one way. Another the other way. One judge has held that the installation is a "structural alteration". Another has found that it is not. It is said, nevertheless, that, being simple English words, we should not interfere. Neither decision can be said to be unreasonable. So let each decision stand. Reliance is placed for this purpose on the speech of Lord Reid in Brutus v. Cozens (1973) Appeal Cases 854.
I am afraid that I cannot accept this argument. As I pointed out in Dyson Holdings v. Fox (1976) 1 Queen's Bench at page 510, when an ordinary word comes to be applied to similarfacts, in one case after another, it would be intolerable if half of the judges gave one answer and the other half another. No one would know where he stood. No lawyer could advise his client what to do. In such circumstances, it is the duty of a Court of Appeal to give a definite ruling one way or the other. However simple the words, their interpretation is a matter of law. They have to be applied, in case after case, by lawyers: and it is necessary, in the interests of certainty, that they should always be given the same interpretation, and always applied in the same way: see our two rating cases in 1949, 1 King's Bench at pages 396, 47½; and Woodhouse v. Brotherhood (Peter) (1972) 2 Queen's Bench at pages 536/7.
Applying the words of Schedule 8 to the house here, I am of opinion that the installation of full central heating to this house was "an improvement made by the execution of works amounting to structural alteration or addition". It involved a good deal of tampering with the structure by making holes in walls and partitions, by lining the chimney with asbestos, and so forth. Much more than is involved in installing fitted cupboards instead of wardrobes, or a modern fireplace instead of old fire-dogs.
This is confirmed by the practice of rating authorities. They have always held that, when full central heating is installed, the rateable value of the house is increased. So much so that they have a formula for calculating the increase according to the number of rooms that are centrally heated: and the increase dates from the time when the central heating is installed, on the ground that it is a "structural alteration" within section 8(4) (b), 79(2)(b) of the General flates Act, 1967. Stronger still is the fact that when the installation is made after 1st April, 1974, Parliament has expressly said that no increase is to be made inthe rateable value by reason of the "structural alterations" involved in installing a central heating system. see section 21 (l)(a) of the Local Government Act, 1974.
The contrary view was supported by some cases under the Settled Land Acts 1882 and 1890. The point there arose about the early form of heating houses by hot water through pipes. It was held that the tenant for life had to instal it himself out of his income: and that he could not require his trustees to pay it out of capital, see Re Gaskell's Settled Estate (1894) 1 Chancery 485, because it was not a structural alteration, see Clarke's Settlement (1902) 2 Chancery at page 331, affirmed in this court in Blagrave's Settled Estate (1903) 1 Chancery at pages 562/3. I find no help in those cases, concerned as they were with a different statute, worded differently, in a different context altogether.
My conclusion is, therefore, that in the previous case Judge White was right, and that in the present case Judge Curtis-Raleigh was wrong. The installation of a full central heating system is a "structural alteration or addition" within Schedule 8 of the Housing Act, 1974. But is it possible for this court to correct the decision of Judge Curtis-Raleigh? That brings me to the point of jurisdiction.
JURISDICTION
There is an express provision in the Housing Act, 1874 which makes the decision of the county court judge "final and conclusive. It is Schedule 8, paragraph 2(2). It applies, among other matters, to the question whether the improvement is one to which the Schedule applies. If such a question is not agreed,...
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