Henley & Anor v Cohen

For the purposes of the Leasehold Reform Act 1967, a building adapted for living in must also be reasonably called a house. That is a fact-sensitive question requiring an overall assessment of the building’s physical character, access arrangements, history, use, proportions and other relevant circumstances. A trial judge’s conclusion should not be disturbed where the correct test was applied and the evidence supports it. A covenant requiring consent to alteration of a property’s plan may extend to its internal layout. Obiter, a lessee cannot ordinarily obtain a statutory compulsory-acquisition right by deliberately committing a breach that creates the condition necessary for the right.

The appellants held a long lease of premises comprising a ground-floor shop and an upper floor. After the respondent refused consent, they converted the upper floor into a self-contained flat in breach of the lease covenant against alterations. They then sought to acquire the freehold under Part 1 of the Leasehold Reform Act 1967.

HHJ Cowell held that the premises were not a house reasonably so called, that the conversion works breached the covenant, and that consent had been reasonably withheld. The appeal concerned the statutory meaning of a house, the construction of the alteration covenant, and whether the appellants could rely on their unauthorised works to establish the statutory right.

The appeal was dismissed unanimously. The declarations made below were upheld.

1. Meaning of house. Section 2(1) of the Leasehold Reform Act 1967 raises a precise statutory question. It is not enough that a building is designed or adapted for living in. The court must examine the premises from all relevant aspects and make an overall assessment of whether it is reasonable to call them a house.
2. Application of the test. HHJ Cowell applied the correct legal test. The upper floor had no history of residential use, was a subsidiary part of the premises, and was physically separated from the ground-floor shop. Access required an external staircase and a route across the shop roof. Those features distinguished the case from Tandon v Trustees of Spurgeons Homes [1982] AC 755, where the residential and commercial parts were physically connected. The trial judge was entitled to place the recent residential use in the context of the preceding history. The conclusion was supported by the evidence and was not an error of law.
3. Breach of covenant. The conversion works altered the plan of the premises. The word plan included the internal layout. The works were therefore carried out in breach of the covenant because the respondent’s consent had not been obtained.
4. Reliance on wrongful conduct. Mummery LJ expressed an obiter view on the alternative disentitlement issue. As a general rule, statutory construction should not permit a person to enforce a compulsory-acquisition right by deliberately committing a wrong that creates the condition necessary for the right. The result depends on the language, purpose and scheme of the statute. Here there was a direct connection between the deliberate breach and the statutory qualification relied upon. The appellants could not rely on the unauthorised conversion works to establish adaptation for living in. Hallett and Leveson LJJ agreed.

1. Court of Appeal (Civil Division) — [2013] EWCA Civ 480: dismissed the appeal.
2. Central London Civil Justice Centre — HHJ Cowell, 28 September 2011: declared that the appellants were not entitled to acquire the freehold and that the alterations breached the lease covenant.