LANDLORD AND TENANT — Leasehold enfranchisement — Adjoining properties — Whether landlord’s intention to redevelop tenant’s flat and flat below into single unit defeating tenant’s right to acquire new lease — Whether two flats together constituting “premises” in which tenant’s flat contained — Leasehold Reform, Housing and Urban Development Act 1993, s 47

Majorstake Ltd v Curtis [2008] UKHL 10; [2008] WLR (D) 32

HL(E): Lord Hope of Craighead, Lord Scott of Foscote, Lord Walker of Gestingthorpe, Baroness Hale of Richmond and Lord Carswell: 6 February 2008

For the purposes of s 47(2) of the Leasehold Reform, Housing and Urban Development Act 1993 “the premises” in which a flat was contained was an objectively recognisable space which a visitor would regard as the premises. The combination of the tenant’s flat and the flat immediately below it in a block of 50 flats on nine floors did not comprise “the premises” in which the tenant’s flat was contained. The landlord’s proposal to redevelop the two flats into a single unit could not therefore defeat the tenant’s right to acquire a new lease.

The House of Lords so held, allowing an appeal by the tenant, Monty Curtis, from a decision of the Court of Appeal (Neuberger and Moore-Bick LJJ, May LJ dissenting) [2007] Ch 300 on 8 August 2006 allowing an appeal by the landlord, Majorstake Ltd, from a decision of Judge Cowell, sitting at Central London County Court on 8 November 2005, that the landlord’s proposal to redevelop flat 77 and the flat immediately below it, flat 74, of Block B, Boydell Court, Saint John’s Wood Park, London NW8, so as to create a single duplex apartment did not relate to “any premises in which the flat [was] contained”.

BARONESS HALE OF RICHMOND said that the 1993 Act was designed to give long leaseholders of flats rights as close as possible to those of freeholders, at a price approximating to the market price, though subject to some statutory assumptions. It could not have been Parliament’s intention to allow the landlord to define the “premises” for itself. That would in many cases defeat the right to a new lease. It seemed clear that “the premises in which the flat is contained” must be an objectively recognisable physical space, something which the landlord, the tenant, the visitor, the prospective purchaser would recognise as “premises”. There was little doubt if one asked a visitor in which premises flat 77 of Boydell Court was contained, the visitor would reply “Block B”. The visitor would not further subdivide the space. Much would depend upon the physical facts on the ground. That was a much more objective test than that proposed by the landlord.

LORD HOPE, LORD SCOTT, LORD WALKER and LORD CARSWELL delivered speeches agreeing with Baroness Hale.

Appearances: Edward Denehan (Freeman Box) for the tenant; Derek Wood QC and Emily Windsor (S J Berwin LLP) for the landlord.

Reported by: Shirani Herbert, barrister