Cowley Property Investment Ltd v Oxford Karting Ltd

Where a claimant positively pleads the terms of a tenancy, the burden lies on the claimant to prove those terms. A defendant alleging that the tenancy was varied bears the burden of proving the variation. A party may discharge its burden without witness evidence where the material facts are admitted. Verified statements of case are not evidence at trial, but admissions need not be proved. In the absence of evidence to the contrary, a change of occupier following surrender of an existing lease may support an inference of an implied regrant on the same terms. A later periodic tenancy will continue on those terms so far as they are consistent with its periodic nature.

Cowley appealed against the dismissal by Her Honour Judge Baucher in the County Court at Central London of its claim for a declaration concerning Oxford’s occupation of premises at Oxford Stadium.

The parties agreed that Oxford occupied on the same terms as Karting UK (Oxford) Ltd had occupied in August 2011. Cowley contended that those terms were those of the 2007 lease. Oxford contended that the terms had been varied, and that Cowley bore the burden of proving the terms on which it relied. Neither party called witness evidence.

The central issues were which party bore each burden of proof and whether the relevant burdens could be discharged through admissions and the documents without witness evidence.

1. Appeal allowed. The judge below had dismissed the claim on the basis that Cowley had not proved its case. The appeal turned on the burden of proof and the effect of the parties’ admissions.
2. Cowley’s Further Information positively averred that Oxford’s occupation was on the terms of the 2007 lease. Cowley therefore bore the burden of proving that case. Oxford’s Further Information alleged that the lease terms had been varied. Oxford bore the burden of proving any variation.
3. Under CPR rule 32.6(2), statements of case verified by statements of truth could not be relied upon as evidence at trial. However, admitted facts did not require proof, and judgment could in an appropriate case be entered on admissions under CPR rule 14.3.
4. Cowley could discharge its burden without witness evidence. The parties’ pleadings and admissions established that the premises had originally been let to Karting on the terms of the 2007 lease; Oxford had not taken an assignment; Oxford’s occupation resulted in an implied surrender; GRA had been notified that Oxford would continue on the same terms; Oxford had paid the monthly rent; and Oxford later occupied under a monthly periodic tenancy.
5. In the absence of evidence to the contrary, those facts supported the inference that Oxford’s occupation from August 2011 to 13 August 2012 arose from an implied regrant by GRA on the same terms as the 2007 lease. From 14 August 2012, Oxford therefore held a monthly periodic tenancy on those terms so far as they were consistent with such a tenancy.
6. Oxford could not discharge its burden of proving variation without witness evidence. A declaration would serve a useful purpose by settling the terms of Oxford’s occupation. The court would make a declaration in terms essentially sought by Cowley, subject to hearing counsel on its precise wording, costs and consequential matters.

• County Court at Central London: Her Honour Judge Baucher dismissed Cowley’s claim for a declaration after trial on 3 and 4 April 2018.
• High Court (Chancery Division): Mr Justice Arnold allowed the appeal and directed that a declaration be made, with the precise terms, costs and consequential matters to be addressed after further submissions.