The Gulf Agencies Ltd v Ahmed

For opposition to renewal of a business tenancy on the ground of the landlord’s own occupation, the landlord must establish both a genuine, firm and settled intention to occupy and a reasonable prospect of being able lawfully to do so. The subjective issue requires the court to decide whether the landlord’s evidence is believed and, where credibility is in issue, to give clear findings and reasons. The objective threshold is real rather than fanciful; planning permission need not be more likely than not. Lawful business occupation for up to two years may satisfy the requirement where it is not fleeting or illusory. A judgment which fails to decide the central credibility issue and give clear reasons cannot stand.

The landlord opposed the tenant’s application for a new business tenancy under Part II of the Landlord and Tenant Act 1954, relying on section 30(1)(g), concerning intended occupation by the landlord for the purposes of a business.

The Central London County Court, HH Judge Mitchell, held that the landlord had not established the necessary intention and ordered that a new tenancy be granted. The landlord appealed, challenging the findings on intention, planning law and apparent bias.

The central issues were whether the trial judge had properly determined the subjective and objective elements of the landlord’s intention, and whether his conduct and reasoning gave rise to apparent bias.

1. Appeal allowed. The trial judgment was set aside and the case was remitted to the County Court for retrial before a different judge.
2. Under section 30(1)(g) of the Landlord and Tenant Act 1954, the landlord had to establish two elements: a genuine, firm and settled intention to occupy the premises for business purposes, and a reasonable prospect of being able lawfully to bring about that occupation. The first element was subjective and the second objective, following Humber Oil Terminals Trustee Ltd v Associated British Ports [2012] EWCA Civ 596.
3. The trial judge failed to determine the central subjective issue. The parties’ cases required a decision whether the landlord genuinely intended to occupy the premises and, particularly if his evidence was rejected, clear findings and reasons. The judge did not resolve the authenticity of conflicting leases and licences or whether the landlord knowingly participated in producing false documents. That failure made the conclusion on subjective intention unacceptable.
4. The objective threshold was not high. A reasonable prospect meant a real chance, not a fanciful possibility, and did not require planning permission to be more likely than not. Occupation for the landlord’s business for up to two years could satisfy the requirement in this case; commercial sense was relevant only insofar as it bore on subjective genuineness. On the trial evidence the landlord satisfied the objective evidential test. If the lawful-use certificate had instead been treated as revoked, there was insufficient evidence and the issue required determination at a new trial.
5. The judge’s initial handling of the landlord’s professional status created an unfortunate impression of predisposition, but the matter was corrected and the later conduct and judgment did not establish apparent bias. The appeal succeeded because of the failure to decide and explain the credibility issue, not because of bias.

• Court of Appeal (Civil Division): Appeal allowed. The lower court’s declaration that the landlord could not rely on section 30(1)(g) and its order for a new tenancy were set aside. The case was remitted for retrial before a different judge.
• Central London County Court: HH Judge Mitchell held that the landlord had not established entitlement to rely on section 30(1)(g) and ordered the grant of a new tenancy.