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England and Wales Court of Appeal (Civil Division) Decisions |
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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Mitchell v Watkinson & Anor [2014] EWCA Civ 1472 (19 November 2014) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2014/1472.html Cite as: [2014] EWCA Civ 1472 |
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ON APPEAL FROM THE HIGH COURT OF JUSTICE
CHANCERY DIVISION (THE HONOURABLE MR JUSTICE MORGAN)
Strand, London, WC2A 2LL |
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B e f o r e :
LORD JUSTICE CHRISTOPHER CLARKE
and
MR JUSTICE BARLING
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Jacki Thomas Laughlin Mitchell |
Appellant |
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- and - |
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(1) John Watkinson (2) Andrew Williams |
Respondent |
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Mr Stephen Jourdan QC and Mr David Mitchell (instructed by Knights Solicitors LLP) for the Respondents
Hearing dates: 26 June 2014
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Crown Copyright ©
MR JUSTICE BARLING
Introduction
(i) In October 1974, when the last payment of rent was made, was the tenancy of the land in question a written tenancy made between the parties to a written tenancy agreement dated the 10 June 1947, or an oral agreement created in about October 1947 on the terms of that written tenancy agreement?
(ii) If the answer to that question is that the tenancy was an oral tenancy, did the tenant continue in possession until October 1986 (i.e. until the end of the twelve years required for the purposes of adverse possession)?
Background to the dispute
"as Trustees of the Ryeworth Cricket Club (hereinafter called respectively "the Trustees" and "the Club" the expression "the Trustees" including the trustees for the time being of the Club)…"
Arthur entered into the Written Tenancy Agreement as
" "Landlord" which expression shall where the context so admits include the person for the time being entitled to the reversion immediately expectant on the determination of the term hereby created…"
The relevant legislation
"Time limit for actions to recover land.
15. (1) No action shall be brought by any person to recover any land after the expiration of twelve years from the date on which the right of action accrued to him or, if it first accrued to some person through whom he claims, to that person.
……
(6) Part I of Schedule 1 to this Act contains provisions for determining the date of accrual of rights of action to recover land in the cases there mentioned.
..…
Extinction of title to land after expiration of time limit.
17. Subject to—
(a) section 18 of this Act;. . .
(b) …
at the expiration of the period prescribed by this Act for any person to bring an action to recover land (including a redemption action) the title of that person to the land shall be extinguished."
Neither side has suggested that there is anything relevant for present purposes in section 18.
"Accrual of right of action in case of present interests in land
1. Where the person bringing an action to recover land, or some person through whom he claims, has been in possession of the land, and has while entitled to the land been dispossessed or discontinued his possession, the right of action shall be treated as having accrued on the date of the dispossession or discontinuance.
..…
Accrual of right of action in case of future interests
..…
5(1) Subject to sub-paragraph (2) below, a tenancy from year to year or other period, without a lease in writing, shall for the purposes of this Act be treated as being determined at the expiration of the first year or other period; and accordingly the right of action of the person entitled to the land subject to the tenancy shall be treated as having accrued at the date on which in accordance with this sub-paragraph the tenancy is determined.
(2) Where any rent has subsequently been received in respect of the tenancy, the right of action shall be treated as having accrued on the date of the last receipt of rent.
..…
Right of action not to accrue or continue unless there is adverse possession
8(1) No right of action to recover land shall be treated as accruing unless the land is in the possession of some person in whose favour the period of limitation can run (referred to below in this paragraph as "adverse possession"); and where under the preceding provisions of this Schedule any such right of action is treated as accruing on a certain date and no person is in adverse possession on that date, the right of action shall not be treated as accruing unless and until adverse possession is taken of the land.
(2) Where a right of action to recover land has accrued and after its accrual, before the right is barred, the land ceases to be in adverse possession, the right of action shall no longer be treated as having accrued and no fresh right of action shall be treated as accruing unless and until the land is again taken into adverse possession.
..… "
The judgment below
(1) The tenancy which came into existence in 1947 between Lawrence as landlord and Mr Staddon and the other Trustees as tenants, was one implied by conduct as a result of the payment and acceptance of rent from September 1947 onwards.
(2) The clear implication from that conduct was that the terms of that tenancy were those set out in the Written Tenancy Agreement.
(3) Even though Arthur did not have title to the land in question on 10 June 1947, the Written Tenancy Agreement created a valid and effective contract of tenancy as between Arthur as the landlord and the Trustees as the tenants. It gave rise to certain estoppels between the parties to it: Arthur, as the landlord, could not set up his own lack of title to avoid the liabilities which he owed to the Trustees under it; the Trustees, as tenants, could not set up Arthur's lack of title to avoid the liabilities which they owed to Arthur thereunder.
(4) However, the Written Tenancy Agreement was not at that point binding on anyone who was not a party to it, such as Lawrence, who could neither sue nor be sued on it; nor was he estopped from denying that it bound him.
(5) There was no basis on which it could justifiably be held that Arthur had assigned to Lawrence the benefit of the Written Tenancy Agreement (and therefore Arthur's reversion by estoppel).
(6) The Trustees were not estopped by convention or otherwise from denying that the tenancy between themselves and Lawrence, which had admittedly arisen in 1947, was granted by the Written Tenancy Agreement, rather than by implication from payment and acceptance of rent. There had been no representation at all on the part of the Trustees, and it could not be said that either party had acted upon some common assumption as to the legal analysis of how the tenancy between them arose. The solicitors' (inaccurate) statement in the letter of 2nd October 1947 did not give a clear indication one way or the other as to that legal analysis.
(7) It followed that the tenancy between Lawrence and the Trustees was "without a lease in writing" within the meaning of paragraph 5(1) of Schedule 1 to the 1980 Act as interpreted in the case law, and therefore that the tenancy fell within paragraph 5, by which it was treated as having determined on the date of the last payment of rent, namely 8 October 1974. The right of action to recover the disputed land was treated as having accrued on the same date. The determination of the tenancy and the accrual of Lawrence's right of action under paragraph 5(1) were subject to paragraph 8 of Schedule 1 to the 1980 Act.
(8) In order for Lawrence's right of action to accrue and for time to start to run, the disputed land had to be "in the possession of some person in whose favour the period of limitation can run" pursuant to paragraph 8(1) of Schedule 1.
(9) Immediately prior to, on, and throughout a period of at least twelve years after 8 October 1974, the disputed land was in the possession of the tenant in the form of whoever was the representative of Mr Staddon's estate or in default the Probate Judge.
(10) It was probable that the tenant was not personally in possession and that, having for many years permitted the Club to use the disputed land, the tenant was in possession during the requisite period through its licensees, the members of the Club.
(11) Accordingly, Lawrence's title was extinguished 12 years after 8 October 1974, on 8 October 1986.
This appeal
(1) He submitted that the tenants under the tenancy with Lawrence, and any successor tenant, were and are estopped from contending that the tenancy arose otherwise than under the Written Tenancy Agreement. Accordingly, no such tenant or successor can deny that the tenancy is "a lease in writing'" within the meaning of paragraph 5(1) of Schedule 1, with the result that time had never started to run against Lawrence.
(2) Further or alternatively Mr Driscoll submitted that on the material before him the Judge was not entitled to find that at material times a successor tenant was in possession for the purposes of paragraph 8(1) of Schedule 1.
(1) The estoppel ground of appeal
Common law estoppel (or title estoppel)
Estoppel by representation
Estoppel by convention
"The Claimant contends that the tenant is estopped from denying that the tenancy which was admittedly granted in 1947 was granted by the agreement of 10th June 1947, rather than by implication from payment and acceptance of rent. It is not said that the tenant in or after 1947 made any representation or promise binding it to a legal analysis as to how the tenancy was granted. The only statement from anyone at that time which might have been relevant as to how the tenancy was granted was the statement in the letter from Arthur Mitchell's solicitors' letter of 2nd October 1947 to the tenants. This stated, wrongly, that after the agreement was entered into, the land had been transferred to Lawrence Mitchell. It is said that this statement was not contradicted by the tenants and so there was an estoppel by convention to the effect that the tenancy was granted by the agreement of 10th June 1947. I do not agree. First, the distinction between a tenancy granted by the agreement of 10th June 1947 and a tenancy granted by implication from the payment and acceptance of rent, the terms of which tenancy are those set out in the agreement of 10th June 1947, is a somewhat subtle one. I do not regard the statement in the letter of 2nd October 1947 as indicating one way or the other what the legal analysis was. Further, at all times until the question of paragraph 5 of schedule 1 to the 1980 Act was raised belatedly at this trial, the legal analysis as to how the tenancy was granted was irrelevant. It cannot be said that either party acted upon some common assumption as to that matter. Further, now that the matter has become arguably relevant, I do not see anything unjust in either party putting forward its contentions as to the correct legal analysis." (Paragraph 47)
"134. Estoppel by convention arises out of an agreed statement of facts or law, the truth of which has been assumed by convention of the parties as a basis of their relationship. When the parties have so acted in their relationship upon the agreed assumption that the given state of facts or law is to be accepted between them as true, that it would be unfair on one for the other to resile from the agreed assumption, then he will be entitled to appropriate relief: see Spencer Bower on Estoppel by Representation (4th ed.) page 180. Commonly, such an estoppel arises where parties contract together on terms which mean one thing, but then conduct their relationship under that contract by reference to a subsequently formed convention between them that it means something else: see for example Amalgamated Investment and Property Co Limited v. Texas Commerce International Bank Limited [1982] QB 84.
135. Estoppel by convention may nonetheless arise otherwise than in a contractual context: see for example Commissioners for Her Majesty's Revenue and Customs v. Benchdollar Limited [2010] 1 All ER 174, in which a convention was established between HMRC and a number of persons alleged to be liable for employers' NIC to the effect that a certain course of conduct was effective to prevent time running against HMRC under the Limitation Acts, when in law it was not.
136. In the present case, counsel were content to accept, subject to one small adjustment proposed by Mr Spink, the summary of the relevant principles in paragraph 52 of my judgment in Benchdollar, after a review of the relevant authorities….. The summary is as follows:
"…. the principles applicable to the assertion of an estoppel by convention arising out of non-contractual dealings, to be derived from Keen v. Holland, and the cases which comment upon it, are as follows:
i) It is not enough that the common assumption upon which the estoppel is based is merely understood by the parties in the same way. It must be expressly shared between them.
ii) The expression of the common assumption by the party alleged to be estopped must be such that he may properly be said to have assumed some element of responsibility for it, in the sense of conveying to the other party an understanding that he expected the other party to rely upon it.
iii) The person alleging the estoppel must in fact have relied upon the common assumption, to a sufficient extent, rather than merely upon his own independent view of the matter.
iv) That reliance must have occurred in connection with some subsequent mutual dealing between the parties.
v) Some detriment must thereby have been suffered by the person alleging the estoppel, or benefit thereby have been conferred upon the person alleged to be estopped, sufficient to make it unjust or unconscionable for the latter to assert the true legal (or factual) position."
137. Mr Spink's suggested adjustment was to part (i) of that summary, where I suggested that the common assumption must be "expressly shared between them". Mr Spink submitted that the crossing of the line between the parties may consist either of words, or conduct from which the necessary sharing can properly be inferred, relying on note 2 at page 180 of Spencer Bower (op. cit.) and The August Leonhardt [1985] 2 Lloyd's Rep 28 at 34-5. I accept that submission."
"Estoppel by convention may arise where both parties to a transaction "act on assumed state of facts or law, the assumption being either shared by both or made by one and acquiesced in by the other" The parties are then precluded from denying the truth of that assumption, if it would be unjust or unconscionable to allow them (or one of them) to go back on it….It seems, however, that the assumption resembles the representation required to give rise to other forms of estoppel to the extent that it must be "unambiguous and unequivocal", and this common feature can make it hard to distinguish between these two forms of estoppel….."
(2) The adverse possession ground of appeal
"No licensor"
"….[the Probate Judge] cannot be said, by virtue of the language of section 9 of the Administration of estates Act 1925 to be a trustee within the meaning of that word for any of the purposes of the Trustee Act 1925. He has no duties whatsoever to perform. No obligations fall upon him. It is a mere matter of necessary convenience and protection which has led to the introduction of section 9….; and although reference is made to the ordinary, the position of [the Probate Judge] appears to me to be different from the position of the ordinary[2], in that, whereas the ordinary had, at any rate in later times, thrown upon him the obligation to discharge debts before holding the balance to pious uses, no such obligation is thrown on [the Probate Judge]. The whole operation of that section is that where the condition is fulfilled of a person dying intestate, his estate, real and personal, vests in [the Probate Judge], and that property remains vested in him until the second condition is fulfilled, namely that administration is granted in respect of that property."
"a positive act with some legal substance ….[in which the Probate Judge had] legal power to give directions about the property." (page 119)
There the Court of Appeal found that the Probate Judge had the legal capacity to receive a notice to quit. Similarly, in Egerton v Rutter [1951] 1 KB 472, the tenant of a farm died intestate; it was held that her children carried on farming as agents for the Probate Judge in whom the tenancy had vested in the absence of a personal representative, and that therefore a notice to quit served on the children was valid.
"moves from being possession with the landlord's consent to being possession held without his consent, and thus, for limitation purposes, adverse.
…
…this analysis does not exclude the possibility that a tenant might have so feeble a connection with the land (the example given in argument was of a man who has gone off to Australia leaving the front door of the demised premises open) that, upon the determination of the tenancy, he could not be said to be in possession at all. But that, in my view, would have to be an extreme case."
"No licence"
"…the members for the time being of an unincorporated association are beneficially entitled to "its" assets, subject to the contractual arrangements between them".
"… the tenant had for many years permitted the club to use the tenanted land….." (paragraph 67).
After all, that is what the terms of the Written Tenancy Agreement expressly required the Trustees, as tenants, to do.
"It seems to have been accepted that before 8th October 1974, the tenant was in possession of the [disputed land], as well as the middle section (and presumably the northern section also)".
He later made a finding to the same effect (see paragraph 67 of his judgment).
Conclusions in the appeal
Note 1 Or perhaps “due under” – the handwritten letter is not clear in this respect. [Back] Note 2 The title of the diocesan bishop of the place where the property in question was situated; the name was used to distinguish the bishop’s exercise of the Church’s jurisdiction in cases of intestacy from his extraordinary or peculiar jurisdiction (see Dyke v Walford 13 ER 557 at page 578). [Back]