Home Information Cases Grosvenor (Mayfair) Estate v Merix International Ventures Ltd (2017)

Skip to content. | Skip to navigation

Grosvenor (Mayfair) Estate v Merix International Ventures Ltd (2017)

Summary

A judge had been entitled, having taken full account of all the guidance to be derived from precedent and reached a decision with the benefit of his own evaluation, to find that a townhouse with past mixed residential and office use and no current use at all, was a house within the Leasehold Reform Act 1967 s.2, entitling an applicant to acquire the freehold interest in it.

Facts

The freeholders of a property appealed against a decision that the property comprised a "house" within the Leasehold Reform Act 1967 s.2 and that the respondent was entitled to acquire the freehold and reversionary interests in it.

The property was a large London townhouse. Following residential use until after the Second World War, it was used at times partially for office purposes with residential accommodation on the upper floors. A 1996 lease required the tenant to use the lower floors only as offices. The relevant date for determining whether a property was a house, thus entitling the respondent to acquire the freehold, was the date the respondent served a notice seeking acquisition. By that date, the property had been totally unused for 13 years. It retained its original external appearance and some of its original internal proportions, plan and features, although there had been alterations to adapt it to office use. The freeholders considered that the property was a disused office building and not a house. The judge considered the relevant authorities and, finding that the property fell within the scope of Boss Holdings Ltd v Grosvenor West End Properties Ltd [2008] UKHL 5, held that it was a house.

Held

The court sought to apply decided cases to the instant appeal. It was useful to put to one side the types of property which were clearly not houses within the statutory definition, although possibly designed or adapted for living in, such as major hotels and purpose-built flats. The only case which concerned a building such as the instant property, without any use at all as at the relevant date and a history of mixed use in the past, was Boss, which concerned a property on the same street as the instant property. It was difficult to take the ratio of Day v Hosebay Ltd [2012] UKSC 41 much beyond the fact that it dealt with buildings with an active and settled use. That implied that other considerations could come in where there was no such use, as in the instant case. One had to look further, because the building was not within the category of "most cases" referred to in Hosebay, Hosebay considered. The last user, or the last adaptation for use, was not necessarily determinative of the character and identity of the building. The statute required the matter to be assessed at the relevant date. Turning the clock back to the time of the last user negated the statute. Past adaptation might have changed the building's current identity or function, but the last user could not be the only relevant consideration. Even if one looked at the position after the last user left, leaving traces of past office user behind, the conclusion that the property was a house might well still have been reached. The judge had considered that the instant case fell precisely within Boss. The court in that case had felt no doubt that the building was a house reasonably so called. To that extent, the case was very close to the facts of Boss. In Boss, residential user of the top floors had been required by the lease, whereas in the instant case office user of the lower floors was required. However, the judge had rightly considered that the terms of the lease should not be the major factor, Grosvenor Estates Ltd v Prospect Estates Ltd [2008] EWCA Civ 1281 followed. There was a tension between statements in Tandon v Trustees of Spurgeons Homes [1982] A.C. 755, on the one hand that the question of whether a property was a house was one of mixed law and fact, and on the other that the question was one of law. However, the court in Tandon had sought to achieve broad consistency in the conclusions reached. Where the trial court was faced with a property of a type not exactly similar to one previously characterised by the higher courts, it had to do its best to apply the law to the facts as found and reach a decision with the benefit of its own evaluation, Tandon and Jewelcraft Ltd v Pressland [2015] EWCA Civ 1111 considered. It would therefore be misplaced to disturb the judge's conclusion that the instant property had essentially the same identity and function as that in Boss. Boss was the closest example for the purpose of trying to place the case within a defined legal category, Boss followed. When a judge had taken full account of all the guidance to be derived from precedent, the assessment of whether a property was a house should not be overturned (see paras 68-80 of judgment).

Appeal dismissed

Court of Apppeal
McFarlane LJ, McCombe LJ, Flaux LJ
Judgment date
30 March 2017
References
LTL 30/3/2017