Patel & Anor v Keles & Anor

Under section 30(1)(g) of the Landlord and Tenant Act 1954, a landlord opposing renewal must prove a genuine and settled intention to occupy for the purposes of its business. The provision imposes no fixed period of intended occupation. The occupation must nevertheless have substance and cannot be fleeting, illusory or merely short-term.

A formed intention to sell within five years prevents reliance on section 30(1)(g), consistently with section 30(2). Even where no such settled intention is proved, a likelihood of sale is relevant evidence. The court must assess all the circumstances to decide whether the landlord has discharged the burden of proving a genuine intention to occupy.

The tenant respondents operated a newsagent and confectionery business from premises at 24 Tudor Street under a business tenancy continued by Part II of the Landlord and Tenant Act 1954. The landlord appellants opposed renewal under section 30(1)(g), asserting that Mr Keles intended to run a newsagent business there.

HHJ Cowell held that the landlords could practically occupy, but found that they had not proved a genuine intention to do so. He treated as significant a two-year, negative undertaking and evidence suggesting that the premises were likely to be disposed of after that period. The landlords appealed. The central issue was whether a likely future sale, rather than an intended sale, could undermine proof of the statutory intention to occupy.

1. Appeal dismissed. Lady Justice Arden, with whom Lords Justices Thomas and Waller agreed, held that the judge was entitled to find that the landlords had not proved the intention required by section 30(1)(g) of the Landlord and Tenant Act 1954.

2. The statutory intention must satisfy the settled-intention test in Cunliffe v Goodman, [1950] 2 KB 237. The landlord bears the burden of proving a genuine intention to occupy for the purposes of carrying on its business. Section 30(1)(g) does not require proof of an intention to occupy for a fixed period, or an additional proof that there will be no sale within five years.

3. Following Willis v Association of Universities of the British Commonwealth, [1965] 1 QB 140, a landlord who has formed an intention to sell within five years cannot establish the statutory intention. The qualification prevents evasion of the protection supplied by section 30(2). Intended occupation must in any event have substance; it cannot be fleeting, illusory or only short-term. What amounts to short-term depends on the facts.

4. A likely sale is not an independent statutory bar where there is no settled intention to sell. It is, however, evidence relevant to the ultimate factual question whether the landlord has proved a genuine intention to occupy. The trial judge could critically assess the limited undertaking, the imprecision of the oral evidence, the landlords’ other income and the disposal of other businesses. Those matters entitled him to infer that the asserted occupation lacked the necessary genuineness and substance.

5. The references to occupation for the “foreseeable future”, read fairly, did not impose an unlawful indefinite-duration requirement. The Court of Appeal would not disturb the judge’s factual inferences after he had heard the witnesses.

• Court of Appeal (Civil Division): Appeal dismissed: [2009] EWCA Civ 1187.
• Central London County Court: HHJ Cowell dismissed the landlords’ opposition to a new tenancy under section 30(1)(g) of the Landlord and Tenant Act 1954. No citation was stated.