Contour Homes Ltd v Rowen

Section 13(1)(b) of the Housing Act 1988 excludes an assured periodic tenancy from the statutory rent-increase procedure where a binding contractual provision means that rent will or may be higher for a later period. The provision covers both fixed rent increases and clauses establishing machinery for determining an increase, such as annual review following notice. It is not confined to agreements specifying the amount of the increase. The statutory rent-assessment procedure is a default mechanism where the parties have not agreed their own rent-review provision. A statutory tribunal’s jurisdiction cannot be enlarged by consent or estoppel.

The tenant occupied a weekly assured tenancy under an agreement containing an annual rent-review clause. The landlord served a rent-increase notice, and the tenant referred it to the Northern Rent Assessment Panel. The panel treated the notice as invalid because it was not in the prescribed form under section 13(2) of the Housing Act 1988. On appeal under section 11 of the Tribunals and Inquiries Act 1992, Irwin J dismissed the landlord’s appeal, holding that section 13(1)(b) applied only where the agreement fixed the amount of the increase. He also held that the landlord was estopped by information in a tenant handbook from denying the panel’s jurisdiction. The Court of Appeal considered the meaning of the contractual exclusion and whether jurisdiction could arise by estoppel.

1. Appeal allowed. The weekly assured tenancy fell within the exclusion in section 13(1)(b) of the Housing Act 1988. The exclusion applies where the tenancy agreement contains a binding provision under which rent for a later period will or may exceed rent for an earlier period.
2. The exclusion is not limited to a clause specifying a fixed increase. It also covers a clause providing machinery for an increase of an unspecified amount, including an agreed procedure under which the landlord serves notice. The words will or may support that construction, and the statutory language should not be confined by adding words that Parliament did not use.
3. The statutory scheme supports freedom of contract. Section 13(4)(b) stops the reference procedure where landlord and tenant agree a different variation or agree that rent should not be varied. Section 13(5) preserves their right to vary any tenancy term, including rent, by agreement. Section 13 therefore operates as a default procedure where the parties have not agreed a contractual rent-review mechanism.
4. The jurisdiction of the rent assessment committee was wholly statutory. It depended on a valid section 13(2) notice being served in a tenancy to which section 13(1) applied. The parties could not confer that jurisdiction by agreement, and the landlord could not be estopped from denying it. The principles in Essex County Council v Essex Incorporated Church Union [1963] AC 808 and J and F Stone Lighting & Radio Ltd v Levitt [1947] AC 209 supported that conclusion.
5. Lord Justice Lawrence Collins and Lord Justice Pill agreed with Lady Justice Arden. The operative order was: appeal allowed.

• Court of Appeal (Civil Division): Appeal allowed. The court held that the contractual rent-review clause excluded the tenancy from section 13 of the Housing Act 1988 and that jurisdiction could not be created by estoppel.
• Queen’s Bench Division, Manchester District Registry: Irwin J dismissed the landlord’s appeal from the Northern Rent Assessment Panel’s decision. The court held that section 13(1)(b) covered only fixed contractual rent increases and that the landlord was estopped from denying the panel’s jurisdiction.
• Northern Rent Assessment Panel: The panel held that the landlord’s notice was not in the prescribed form under section 13(2) and dismissed the tenant’s application without assessing the rent.