Ivorygrove Ltd. v Global Grange Ltd

For purposes of Landlord and Tenant Act 1954, section 30(1)(f), demolition, reconstruction and substantial construction are questions of fact and degree. The court must examine the works as a whole and apply common sense to their physical character, extent and effect.

Load-bearing work is not a pre-condition. Non-load-bearing physical features, including substantial partitioning, may qualify, although ordinary demountable office partitions will not. Works ancillary or closely connected to qualifying structural works may be considered when assessing substantiality, but unrelated fitting-out and furnishing must be excluded.

Ivorygrove operated a hotel in four adjoining listed Georgian houses. Global, the prospective landlord, opposed the grant of a new tenancy under section 30(1)(f) of the Landlord and Tenant Act 1954, relying on a substantial refurbishment and redevelopment scheme.

HH Judge Green QC held that Global had the necessary intention and reasonable prospect of carrying out the works, and that the scheme involved demolition and reconstruction of a substantial part of the premises and substantial work of construction. Ivorygrove appealed from that decision, relying in part on the earlier decision concerning another Bedford Place hotel, Global Grange Ltd v Marazzi, and the appeal judgment in that case. The central issues were the proper scope of section 30(1)(f), the relevance of non-load-bearing partition walls and ancillary works, and the appellate standard of review.

1. The appeal was dismissed. Permission to appeal was granted, but the decision of HH Judge Green QC was upheld.
2. The question whether intended works amount to demolition or reconstruction of a substantial part of the premises, or substantial work of construction, is ordinarily a question of fact and degree. An appellate court should not interfere absent misdirection, an error in the approach to the evidence, or a conclusion unsupported by the evidence. The judge’s assessment was properly open to him.
3. Section 30(1)(f) contains several separate alternatives, including demolition or reconstruction of the whole or a substantial part of the premises and substantial work of construction on the holding or part of it. The landlord must establish a bona fide intention and a reasonable prospect of being able to carry it out, including obtaining necessary consents.
4. The statutory language does not require the works to affect load-bearing or structural features. Whether a physical feature is load-bearing is a factor in the fact-and-degree assessment, not a condition of applying the section. The court should not import the word structure, or case law concerning that word in other statutory contexts, into section 30(1)(f).
5. Partitioning may fall within the section where its nature, extent and role in the premises justify that conclusion. The position differs for ordinary demountable office partitions. The substantial removal and reconstruction of hotel partitions, together with alterations to floors, walls, services, drains, the lift and basement structure, was capable of constituting qualifying work.
6. The works had to be viewed as a single scheme. Ancillary works, including preparation, making good, rewiring, and the laying of cables and drains, could be considered where sufficiently connected with demolition, reconstruction or construction. General furnishing and fitting-out remained outside the section. In any event, the agreed bedrock of structural work costing over £450,000 was itself a substantial work of construction and independently disposed of the appeal.
7. The different result in Global Grange Ltd v Marazzi did not require interference. The evidence before Judge Green was materially fuller, and the appeal in Marazzi had concerned whether the first-instance decision was open to the judge, rather than the correct answer on the merits.

• High Court (Chancery Division): Permission to appeal granted and appeal dismissed. The decision of HH Judge Green QC was upheld.
• Central London County Court: HH Judge Green QC held that the landlord established the ground in section 30(1)(f) of the Landlord and Tenant Act 1954.