Humber Oil Terminals Trustee Ltd v Associated British Ports

For the purpose of section 30(1)(g) of the Landlord and Tenant Act 1954, a landlord must show both a fixed and settled desire to occupy and a reasonable prospect of being able to give effect to that desire. The latter is an objective and practical inquiry.

The reasonable-prospect inquiry must be conducted on the statutory hypothesis that the current tenancy has ended and the landlord is entitled to possession. It may therefore take account of the likely commercial conduct of the former tenant after that event. This does not impermissibly assume the answer to the landlord’s opposition to renewal.

Humber Oil Terminals Trustee Ltd was the tenant of four leases comprising the Immingham Oil Terminal. Associated British Ports, the landlord and statutory harbour authority, opposed the tenant’s applications for new business tenancies under Part II of the Landlord and Tenant Act 1954.

Vos J held that the landlord had established the ground in section 30(1)(g), namely an intention to occupy the holdings for its port business: [2011] EWHC 2043 (Ch). The tenant appealed on the basis that the judge had wrongly assessed the landlord’s prospect of implementing that intention by assuming that the leases had ended and that a commercial arrangement with the tenant might follow. It also sought, out of time, to renew permission to challenge an alternative factual finding.

1. The court unanimously dismissed the appeal on ground 1. It also refused to extend time for a renewed permission application on ground 4.

2. Section 30(1)(g) required proof of a genuine, firm and settled intention, together with a reasonable prospect of carrying it into effect. The first limb was subjective and was unchallenged. The second was an objective, practical assessment of the evidence, following Cunliffe v Goodman, [1950] 2 KB 237, and Gregson v Cyril Lord Ltd, [1963] 1 WLR 41.

3. Applying Westminster City Council v British Waterways Board, [1985] AC 677, the court held that the objective inquiry had to proceed on the hypothesis required by the statutory language: the current tenancies had terminated and ABP, rather than HOTT, was entitled to possession. The judge was therefore entitled to assess the probability that economic and commercial considerations would lead HOTT to agree an arrangement enabling ABP to operate the terminal. There was no principled basis for excluding dealings with the former tenant from that assessment. HOTT’s circularity argument was the same in substance as an argument rejected in Westminster.

4. The unchallenged finding that a commercial arrangement was likely was sufficient to establish the reasonable prospect required by section 30(1)(g). Ground 4, directed to an alternative finding about ABP’s use of the terminal if HOTT did not cooperate, could not affect that result. It was also advanced substantially out of time and lacked real prospects of success. The court therefore declined to extend time under the procedural rules.

• Court of Appeal (Civil Division): dismissed HOTT’s appeal on ground 1 and refused an extension of time to renew permission for ground 4: [2012] EWCA Civ 596.

• High Court, Chancery Division: Vos J held that ABP had established its opposition to new tenancies under section 30(1)(g) of the Landlord and Tenant Act 1954: [2011] EWHC 2043 (Ch).