Ambrose v Kaye

Under the Civil Procedure Rules, a judge may adjourn a hearing and admit further evidence where this is required to deal with the case justly. The discretion must further the overriding objective and is not constrained by a rigid rule that evidence cannot be admitted after the close of oral evidence or during submissions.

Where a tenant relies on a legal point capable of remedy, the point should be identified, if possible, before the hearing so that the court can manage the case appropriately. This principle does not require a party to warn an opponent that a statutory notice or time limit is defective. An appellate court will interfere with the exercise of such a discretion only for legal or procedural error, or where the decision is plainly wrong.

The tenant occupied business premises under a protected underlease governed by Part II of the Landlord & Tenant Act 1954. The landlord opposed a new tenancy under ground (g), intending that an existing family-company business should be expanded into the premises.

At the hearing of the preliminary issue, it emerged that the landlord did not initially have a controlling interest in the company. During a luncheon adjournment, shares were transferred to him, giving him the required control. The county court admitted further evidence of the transfer, found the ground established, and ordered possession with statutory compensation.

The tenant appealed, contending that the judge had acted wrongly in reopening the evidence and allowing the defect to be remedied after closing submissions.

Appeal dismissed. Lord Justice Chadwick delivered the judgment, with Sir Murray Stuart-Smith agreeing.

1. The county court had power under CPR 3.1(2)(b) and (m) to adjourn the hearing and admit further evidence. Those powers had to be exercised to give effect to the overriding objective in CPR 1.1 and 1.2, with the parties assisting the court and the court actively managing the case under CPR 1.3 and 1.4(2)(b).
2. The court rejected a rigid approach under which a party could deliberately reserve a readily curable point until closing submissions and then insist that the court ignore evidence curing it. The tenant’s point was based on the absence of a controlling interest for the purposes of section 30(3) of the Landlord & Tenant Act 1954. If relied upon, it should have been identified at an early stage so that the court could determine it efficiently, including by giving the landlord an opportunity to remedy it.
3. The position was different where legislation or a lease required a step, such as service of an effective notice, by a specified date. The judgment did not impose any duty to warn an opponent of an impending statutory default. This case concerned evidence in proceedings already properly before the court, not an ineffective notice served out of time.
4. The relevant intention for ground (g) was assessed at the hearing, and the court was required to have regard to the position when the order was made, following Betty’s Cafe Ltd v Phillips Furnishing Stores Ltd [1959] AC 20. Once the further evidence was admitted, the landlord established a genuine intention and viable plans for the company’s business. The judge’s discretionary decision was not flawed in principle and was not plainly wrong.

The tenant was ordered to pay the appeal costs, summarily assessed at £4,500 including VAT. Permission to appeal to the House of Lords was refused.

1. Court of Appeal (Civil Division) [2002] EWCA Civ 91: appeal dismissed; possession order and statutory compensation outcome upheld.
2. Willesden County Court: His Honour Judge Sich held that the landlord established ground (g) under section 30(1) of the Landlord & Tenant Act 1954, admitted the further share-transfer evidence, and declined to grant a new tenancy.