October 2022

In this series of articles, we aim to highlight 3 of the most interesting cases in our field decided in the past month. This month: the Court of Appeal on the law of ejectment and on recoverability of fees for collecting ground rents under residential leases, and the High Court on the creation of parking rights,.

Many of our readers will be aware of the Supreme Court’s judgment this month in Guest v Guest [2022] UKSC 27, which is of significance in the law of proprietary estoppel. Interested readers are referred to this excellent summary[1] already prepared by our colleague Elizabeth Fitzgerald.

OCTOBER 2022

?Brake v The Chedington Court Estate Ltd [2022] EWCA Civ 1302

Summary

The Court of Appeal found that it was unlawful for the person with the beneficial interest in a property to evict persons who had legal title but no beneficial interest without a court order.

The appellants were 2 of the 3 registered legal owners of the property, which was held on trust for a partnership (which was in liquidation).?The liquidators sold their interest to the appellants’ trustee in bankruptcy. Although they did not reside in it (the court dismissing an appeal against that finding), the appellants were in possession of the property. The trustee in bankruptcy granted a licence to the respondent, which took possession of the property, without having first obtained a court order.

Lewison LJ, giving the leading judgment, held that the appellants had been wrongfully ejected. The judge below had erred by asking whether the beneficiary (on whose behalf the company acted) would have had a defence to an action for ejectment, whereas he should have asked whether the beneficiary had a better common law right to possession entitling him to enter without first having recourse to the courts. ?The fact that the beneficiary would likely to have been able to obtain an order for possession by relying on equitable principles (since the appellants were bare trustees) did not justify them (or their agents) taking possession without a court order. However, whether the appellants were entitled to any relief was to be determined subsequently

Why it’s important?

This latest chapter in the long-running Brake litigation is of note for Lewison LJ’s detailed history of the law of ejectment and analysis of its constituent elements, and as a rare example of a situation where, despite the long-standing fusion of law and equity in our Courts, it is necessary to consider the 2 branches separately; the judgment will be of interest to practitioners and to legal history enthusiasts alike.??

Campden Hill Gate Ltd v Duchess of Bedford House RTM Company Ltd [2022] EWHC 2489 (Ch)

Summary

The High Court allowed an appeal in a dispute relating to tenants’ rights to park around a mansion block.

The respondents were long leaseholders of flats in a block (DOBH). The appellant was the headlessee of a neighbouring block, CHG (part of the same freehold title), and the private road between DOBH and CHG. The respondents, successful at first instance, claimed a right to park on the part of the private road nearest DOBH.

Adam Johnson J declined to interfere with the judge below’s findings on the evidence of parking practices by the tenants of DOBH in the 1960s. He further upheld the judge’s conclusion that when the headlease of CHG/the road was granted, the reservation of “quasi easements and rights belonging to or enjoyed by any adjoining or neighbouring premises” resulted in the ‘settled practice’ of tenants in DOBH parking on the private road becoming a legal easement.

However, the judge below had been wrong to conclude that the right was included in the subsequent grant of the headlease of DOBH: on the true construction of the headlease, the parking right was excluded by a carve-out excepting rights which might interfere with future development. Accordingly, the appeal was allowed.

Why it’s important

The judgment contains interesting commentary on and application of the principle recognised in Newman v. Jones (22 March 1982, unrep) that a ‘settled practice’ of tenants of a block parking around that block can create a right reputed to appertain to the flats in the block. It is now apparent that that doctrine is not confined to a claim by an individual leaseholder; rather, it is capable of application to a claim by tenants of a block for rights appertaining to the block as a whole.?The judgment also suggests that a reservation in a lease of the ‘servient’ land of quasi-easements and rights effects the same conversion of those rights into legal easements as section 62 does on the conveyance of the ‘dominant’ land.

The judgment also contains a salutary reminder of the reluctance with which appellate courts will interfere with not only factual findings of the trial judge, but also the inference and analysis of those facts. In this case, the fact that individual?

elements of the evidence might arguably be said to be inconsistent with the judge’s conclusion did not mean that his overall decision was unsound.

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Avon Ground Rents Ltd v Stampfer [2022] EWCA Civ 1375

Summary

The Court of Appeal determined that on the construction of the lease in question, a landlord was not able to charge a fee for the preparation and service of a notice under s.166 Commonhold and Leasehold Reform Act 2002.

The lease provided for the landlord to be able to charge sums in respect of ‘the collection of rents’. The landlord purported to charge a fee for the preparation and service of notices under s.166 of the 2002 Act, which are required to be served before ground rents are due from long leaseholders. The tenants argued that the fee was not permissible within the clause.

Upholding the decision of the Upper Tribunal, the Court of Appeal held that the preparation and service of the notice should not be viewed as part and parcel of the process of the collection of the rent; making the rent due was a logically prior and distinct event. Accordingly, the charge was not permissible under the terms of the lease.

Why it’s important

Although this case turned on the wording of the lease in question, other parties to similar leases may wish to consider this issue. In addition to the distinction between making tenants liable for the rent (which may or may not be followed by collection) and the collection of the rent, the Court derived support from the fact that the lease referred to costs of notices under s.146 Law of Property Act 1925, but not the costs of notices under s.166 of the 2002 Act.

Nugee LJ (with whom Bean and Phillips LJJ agreed) commented in his judgment that although the court was concerned only with whether the fee itself was permissible, as opposed to whether it was reasonable in amount (as the First Tier Tribunal had thought it was), he entertained some doubt as to whether the fee of ￡30+VAT would be considered reasonable. Those comments may be drawn upon in future challenges to the reasonableness of the quantum of such charges.

STEPHANIE TOZER K.C.

FERN SCHOFIELD

[1] Please link: https://www.falcon-chambers.com/publications/articles/guest-v-guest