Zas Ventures Ltd v Forkner

A contractual right to occupy property may be made conditional on performance of obligations to insure and maintain it. Language such as “provided that” can demonstrate that the obligations are conditions, breach of which may justify termination and possession rather than merely damages. However, a proprietor’s prolonged failure to enforce such conditions may represent that they will not be insisted upon without reasonable notice. Any renewed enforcement will ordinarily apply only to subsequent deterioration. Laches concerns past claims and does not prevent equivalent claims arising in the future. An appellate court will not generally entertain a factual submission that was not properly investigated at trial.

The appellant had lived in a house owned successively by family members and then by the respondent. An informal family agreement permitted her to occupy the property rent-free provided that she insured it and kept it in good repair. She admitted failing to perform those obligations, but argued that previous owners had waived or released them, had acquiesced in the breaches, or were barred by laches.

The County Court ordered her to give possession. The appeal challenged the nature of the occupancy conditions, the reliance on a continuing repairing obligation without amendment to the pleadings, and the effect of the previous owners’ failure to enforce the obligations. The central issue was whether the respondent could terminate the right of occupation for subsequent non-compliance.

Disposition. Lord Justice Moore-Bick dismissed the appeal. Lord Justice McCombe agreed.

1. The obligation to insure and maintain the property was a condition of the appellant’s right to occupy it. The words “provided that” indicated a condition, and a reasonable person in the position of the purchasers would understand the agreement in that way. Breach therefore provided grounds for termination of the right of occupation.
2. The informal agreement had to be construed from the language recorded in the statutory declaration. The parties’ unrecorded private intentions were irrelevant, and speculative draft auction particulars did not assist in construing the agreement.
3. The repairing obligation was continuing. It required repairs and maintenance as needed from time to time, but the predecessors’ knowledge of the property’s poor condition and their failure to require repairs for many years amounted to a clear representation that they would not insist on performance without reasonable notice. The appellant could not be required to remedy deterioration accumulated during that period. After notice, however, the obligation could be enforced in respect of subsequent deterioration.
4. Laches did not assist the appellant. It operates as a limitation-type defence in relation to claims arising in the past; it does not prevent similar claims arising in the future.
5. The County Court was entitled to treat the obligation as continuing without amendment to the particulars of claim. The appellant had not been misled, and the real issue had been addressed at trial.
6. The submission that repairs would have been ineffective because of earlier defects had not been properly investigated at trial and could not be relied on to overturn the decision. It was unnecessary to decide whether failure to insure alone would have justified recovery of possession.

• Court of Appeal (Civil Division): Appeal dismissed.
• County Court in Central London: Her Honour Judge Faber ordered the appellant to give possession of the property to the respondent.