| LANDLORD AND TENANT — Security of tenure — Statutory tenancy — Compromise of earlier possession action on terms inferring tenant’s protection —
Whether landlord entitled to challenge issue in subsequent action
Carphone Warehouse UK Ltd v Malekout [2006] EWCA Civ 767
CA: Ward and Smith LJJ and Cresswell J: 14 June 2006
A compromise of possession proceedings of residential premises on terms inferring recognition by the landlord of the tenant’s statutory protection estopped the landlord in a subsequent action from contesting that issue.
The Court of Appeal in reserved judgments so held when dismissing an appeal by the landlord, Carphone Warehouse UK Ltd, from the decision of Judge Walker, sitting in Wandsworth County Court in August 2005, that the tenant, Cyrus Malekout, was entitled to statutory protection in respect of Flat 1, Central Mansions, Prentis Road, London SW16.
In May 2003 the landlord’s action against the tenant for possession claiming arrears of rent was compromised on terms embodied in a Tomlin order, both parties there agreeing that the tenant was a statutory tenant and would resume his occupancy on completion by the landlord of repairs. In 2004 the landlord issued fresh proceedings against the tenant for arrears of rent and possession. The judge held that, had the issue of the statutory tenancy been raised in the earlier proceedings, he would have held that the tenant had lost protection because he ceased to occupy the premises in 1994, but then went on to conclude that the only inference from the terms of the Tomlin order had decided that issue in the tenant’s favour and it would be an abuse of process for the landlord now to contend that the tenant had lost his statutory protection before May 2003.
SMITH LJ said that the effect of the Tomlin order was not to create an estoppel limited merely to the legal conclusion that the tenant was a statutory tenant as at May 2003; its effect was to create an estoppel as to the essential facts and circumstances underlying the agreement made at that time. If the tenant was to be taken as a statutory tenant at that time, the necessary inference was that he had an intention to return to the premises to occupy them as his residence. That was so whatever might have been the situation in the mid-1990s. The judge rightly posed the issue as whether during the period between May 2003 and July 2004 the tenant had not lost his statutory protection by showing that he intended to return when the work was finished and the premises habitable. The judge’s finding of fact in the tenant’s favour on that issue was unimpeachable. The landlord had challenged on the pleadings in the earlier proceedings the tenant’s status but had abandoned the issue, the agreement being reached on the basis that the tenant was a statutory tenant. That agreement could not be treated as a bare statement of law. It had to be clothed with the essential underlying facts. The agreement was predicated on the assumption that the tenant was a statutory tenant who intended to go into actual occupation when the repairs were complete.
WARD LJ and CRESSWELL J agreed.
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