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Should it stay or should it go? Mark Galtrey - - PowerPoint PPT Presentation
Should it stay or should it go? Mark Galtrey - - PowerPoint PPT Presentation
Should it stay or should it go? Mark Galtrey www.falcon-chambers.co.uk www.falcon-chambers.co.uk Overview Darling you got to let me know Should I stay or should I go now? Should I stay or should I go? Should I stay or should I go now? If
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If you say that you are mine… Ownership of chattels
- Tenant’s chattels are the property of the tenant
- Torts (Interference with Goods) Act 1977
- Notice + reasonable time to collect
- Otherwise sell and net proceeds to tenant
- Landlord’s chattels are the property of the landlord
- Trover – action for the value of the removed chattels
- Armory v Delamirie (1722) 1 Strange 505
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If you say that you are mine… Ownership of fixtures
- Recap: fixtures form part of the land for as long as they are affixed
- Therefore owner of the land owns the fixtures while they are affixed
- s.62 of the Law of Property Act 1925 provides that a conveyance of
land is deemed to include all fixtures
- Cannot be ousted even by express agreement of the parties: Melluish
(Inspector of Taxes) v BMI (No.3) Ltd [1996] A.C. 454
- Different question from rights or obligations to remove fixtures during
- r at the end of the lease
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If you want me off your back… Obligation to remove chattels
- Almost always an express or implied covenant to yield up possession
at the end of the lease
- Chattels must be removed by tenant prior to end of lease to prevent
breach of this covenant
- Damages for breach are reasonable costs of removal of the chattels
- If follow Torts (Interference with Goods Act) process, no double
recovery allowed
- Also implications for vacant possession (see later)
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If you want me off your back… Obligation to remove fixtures
- Landlord’s fixtures remain with the land
- Part of the land and revert to the landlord
with the land at the end of the term
- Tenant’s fixtures: general rule is no
- bligation to remove: Never-Stop Railway
(Wembley) Ltd v. British Empire Exhibition (1924) Inc [1926] Ch 877
- Logic is that tenant’s fixtures are also part
- f the demised premises, which returns to
landlord at the end of the term: Elitestone v Morris [1997] 1WLR 687
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If you want me off your back… Obligation to remove fixtures
- There are exceptions to the general rule
- Express obligation to remove in lease or in
licence for alterations
- Might be implied from premises being defined to
exclude fixtures, but might just preserve the tenant’s right to remove the fixtures (see later)
- Might be implied from covenant to give vacant
possession (also see later)
- Combination of these two used to justify
decision in Riverside Park v NHS Property Services [2017] L&TR 12
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If you want me off your back… Obligation to remove fixtures
- Might be implied from a covenant to
deliver up in good and tenantable condition: Shortlands Investments Ltd v Cargill [1995] 1 EGLR 51
- Clips on heating unit rendered the unit
not in good and tenantable condition
- Redundant halon fire extinguishers
rendered whole premises not in good and tenantable condition
- Might be obliged to remove fixture
installed in breach of covenant – but breach is installation not failure to remove, so need to think about limitation
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Well come on and let me know… Problems with notices: notices to remove
- Assumes express obligation to remove on
notice in lease or licence
- Westminster City Council v HSBC Bank
[2003] 1 EGLR 62
- Service of schedule of dilapidations
deemed to be sufficient notice
- But try to avoid Mannai arguments
- Probably need not give notice before end of
lease but must give reasonable time to comply: Scottish Mutual Assurance Society Ltd v British Telecommunications Ltd
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Well come on and let me know… Problems with notices: conditional break notices
- Conditions must be met precisely: Mannai v Eagle Star [1997] AC 749
- Vacant possession is common condition of exercising break
- No VP if tenant is using more than de minimis for own purposes or if
physical condition creates a substantial impediment to use of the property (second only exceptionally satisfied)
- Legal & General Assurance Society Limited v Expeditors International
(UK) Limited [2006] EWHC 1008 (Ch) (unaffected on appeal)
- Fixtures are part of the thing of which VP must be given and so their
presence cannot be a bar to giving VP
- Compare Riverside Park v NHS
- Chattels (and keys!) can still be a bar to VP but ordinary rubbish will
not: Hynes v Vaughan (1985) 50 P&CR 444
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Well come on and let me know… Problems with notices: conditional break notices
- Goldman Sachs International v Procession
House Trustee [2018] EWHC 1523 (Ch)
- Landlord argued that both VP and
reinstatement to original layout were preconditions of break clause
- Question of construction, but vagueness of
drafting of reinstatement clause counted against landlord, as did potential windfall to landlord from trivial breach by tenant
- Sceptical about Riverside but did not go as
far as saying it was wrong
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If I go there will be trouble… Tenant’s right to remove fixtures
- Tenant’s fixtures are in general removable, landlord’s fixtures are not
- Tenant’s fixtures are those that meet three conditions
- Annexed to the premises by or on behalf of the tenant
- Trade fixture, ornamental and domestic fixture or agricultural
fixture
- Objectively regarded, annexed with the intention of removing it as
and when the tenant so wished
- Used to be thought could not oust right to remove tenant’s fixtures
except by particularly clear language, based on comments of Vaughan Williams LJ in Lambourn v McLellan [1903] 2 Ch 268
- Wrong, it is simply a matter of construction: Peel Land and Property
(Ports No. 3) v TS Sheerness [2014] EWCA Civ 100
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If I go there will be trouble… Tenant’s right to remove fixtures
- If do remove, must make good so as to leave
the premises in a reasonable condition: Mancetter Developments Ltd v Garmanson [1986] 1 All ER 449
- Will mean that have to fill in e.g. large holes
left by removal of ducts
- Probably don’t need to redecorate after
removal
- Unclear about de minimis e.g. screw holes
- Failure to make good is the tort of waste
- Directors can be personally liable
- But not clear if this action lies where can
instead sue on covenant to yield up in repair
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If I go there will be trouble… Tenant’s right to remove fixtures
- Tenant’s right to remove fixtures continues during his original term,
and for so long thereafter as he holds the premises under a right still to consider himself as tenant
- If the tenant does not remove his fixtures within this time, they become
part of the freehold, and no right to enter onto the land and remove them: Jones v Forest Fencing Limited [2001] EWCA Civ 1700
- If remove fixtures belonging to landlord, may be waste and/or breach
- f covenant to yield up in repair, and landlord can get injunction for
delivery up of severed fixture or even injunction to restrain removal or for return: Phillips v Lamdin [1949] 2 KB 33
- Note the special rules for agricultural tenancies in the AHA 1986
(supplements common law) and ATA 1995 (ousts common law)
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And if I stay it will be double Willful holding over
- Section 1 of Landlord and Tenant Act 1730
- Double value for “willful” holding over after end of term
- Must be more than deliberate holding over, tenant must know they are
not entitled to stay: French v Elliott [1959] 3 All ER 866
- Could possibly be engaged by obstructive tenant filling property with
chattels so as to render it unusable
- Rare but worth remembering about and serving notice
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This indecision's bugging me… Uncertainty around alterations covenants
- The installation of a fixture may constitute a
breach of the covenant against alterations
- Whether it will do so will depend on the terms of
the covenant and the nature of the fixture
- Installation of trade fixtures will often not
constitute a breach of a covenant not to make alterations
- Necessary to interpret covenant in a sensible
way which allowed the tenant to carry on his business so in Bickmore v Dimmer [1903] 1 Ch 158 the clock was not an “alteration”
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