Savva and another v Houssein [1996] EWCA Civ 1302; (1997) 73 P & CR 150
Court of Appeal — 24 April 1996
Facts
Mr and Mrs Savva granted Mr Houssein a 12-year lease of ground-floor premises in Delancey Street, London, in July 1991. The permitted uses included a café, snack bar and minicab business. The lease restricted alterations and signs without the landlords’ written consent and required the landlords to keep the main walls and roof in repair.
The tenant changed the frontage and signs and installed a flue running through the ceiling, the space above it and the roof. The lease included the premises only up to the ceiling plaster, leaving the roof outside the tenant’s demise.
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The landlords sought forfeiture for breach of covenant after serving a notice under section 146 of the Law of Property Act 1925. They also sought damages and an injunction for trespass caused by the flue. The tenant counterclaimed over roof leaks and damp walls.
Procedural history
Judge Cotran rejected the landlords’ claim and upheld the tenant’s counterclaim. He awarded damages equivalent to two months’ rent and ordered repairs to the roof and walls. The landlords appealed.
Issues
Were alterations and signs installed without prior consent capable of remedy, so that the section 146 notice had to require the tenant to remedy them? The court also considered whether the flue was a trespass and whether the damages and repair order on the counterclaim should stand.
Decision
The Court of Appeal dismissed the appeal, subject to adding permission for the landlords to apply for an injunction or another remedy for trespass if circumstances changed.
The alleged covenant breaches were capable of remedy. Because the notice did not require them to be remedied, it was invalid and could not support forfeiture. The tenant’s damages and the order requiring the landlords to repair remained in place.
Why the breaches were capable of remedy
Staughton LJ rejected the argument that an alteration made without prior consent must be irremediable simply because consent could no longer be obtained before the work was done. The question was whether the harm caused by the breach could be removed. Unauthorised signs could be taken down and alterations could be reversed.
Aldous LJ agreed that covenants prohibiting conduct were not automatically different from covenants requiring something to be done. Section 146 gave a tenant a final opportunity to put matters right before forfeiture. The practical effect of the proposed remedy mattered, rather than whether it could erase the historical fact of non-compliance.
The court therefore did not need to decide all the disputes about breach and waiver. Its conclusion concerned the defective notice; it was not a finding that the tenant’s alterations complied with the lease.
Trespass and the repair counterclaim
The trial judge had been wrong to find no trespass. The flue’s penetration through the landlords’ roof was a trespass, and its extension into their airspace might also be one. No present loss was shown, so the Court of Appeal did not award trespass damages. It instead preserved the landlords’ ability to seek relief if circumstances changed, including a future lawful building project above the premises.
The landlords argued that the tenant’s flue had caused the leaks. However, the trial judge had made no finding to that effect. The finding of a culpable failure to repair therefore stood.
Although the tenant’s claimed lost-profit figures had not been accepted, damages equivalent to two months’ rent were upheld as a reasonable inference from the business’s loss. The repair order also stood, with any necessary clarification available from the county court.
