England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE CARDIFF COUNTY COURT
(HIS HONOUR JUDGE MASTERMAN)

		Royal Courts of Justice Strand London WC2A 2LL Wednesday 28 August 2002

1. LORD JUSTICE PETER GIBSON: The first defendant ("Punch") renews its application for permission to appeal out of time, permission having been refused on paper by Jonathan Parker LJ. Both sides, as well as the trial judge, thought that time for lodging an appellant's notice was 28 days; it is, of course, 14 days in the absence of contrary directions (CPR 52.4(2)(b)). The appellant's notice was lodged 28 days after the judge's order. However, the period of delay is short. I am not aware of any prejudice to the claimant, Ganton, and if there is substance in the proposed appeal, I would extend time.
2. The dispute between the parties relates to a property in Bridgend. A pub, The Pied Piper, has a car park with more than 50 car parking spaces. Attached to the pub is a betting shop. The second and third defendants, Mr and Mrs Tucker, are the underlessees of the pub. Punch is the landlord of the entire premises. On 15 January 1981, Punch's predecessors in title granted Ganton a 21-year lease of the betting shop. On 31 August 1995 they granted Mr and Mrs Tucker a 10-year underlease of the pub.
3. On 18 November 1998, by an agreement expressed to be supplemental to two deeds, including the 1981 lease, Punch's predecessors in title granted Ganton, in consideration of a payment of £5,000 paid to Mr and Mrs Tucker and with the consent of Punch's predecessors, the right to use up to ten parking spaces in the car park, to hold the same unto Ganton contemporaneously with and throughout the term granted by the 1981 lease.
4. On the expiry in January 2002 of the 21-year 1981 lease of the betting shop, Mr and Mrs Tucker claimed that Ganton no longer had the right to occupy any parking spaces in the car park. Ganton commenced these proceedings and obtained an interim injunction to allow it to continue to use the car park pending trial.
5. In the meantime, Punch had issued a notice under section 25 of the Landlord and Tenant Act 1954 and Ganton served a counternotice and applied for a new tenancy. A new tenancy is not opposed by Ganton.
6. Three preliminary issues were identified:

1. Did or does Ganton's tenancy of the betting shop include the parking rights granted by the 1980 agreement?

2. Do those rights continue so long as Ganton's tenancy is renewed under section 24 of the 1954 Act?

3. Can the court grant parking rights corresponding to those granted in 1998 when the court determines the terms of the new tenancy?

7. His Honour Judge Masterman answered all three issues in the affirmative. His decision was based on the fact that the 1998 agreement was expressed to be supplemental to the 1981 lease. He thought that the plain meaning of that was that the 1998 agreement's terms became part of the 1981 lease which it varied, and that the parking rights therefore did not come to an end and could form part of the new tenancy.
8. Mr Tanney, for Punch, submits that the judge erred in two respects.
9. First, he submits that the word "supplemental" has the meaning and effect laid down in section 58 of the Law and Property Act 1925, that is to say that, as far as may be, the 1998 agreement must be read and have effect as if it contained a full recital of the 1981 lease. He says that it does not effect any variation of the lease.
10. Ganton has put in a skeleton argument, submitting that permission to appeal should be refused. However, I am persuaded that this ground of appeal has a real prospect of success. To a conveyancer the use of the word "supplemental" in a professionally drawn document, such as we have with the 1998 agreement, is a shorthand way of incorporating the section 58 meaning, viz that the 1998 agreement is treated as reciting the terms of the 1981 lease. The wording used in the 1998 agreement is, on its face, appropriate to an agreement quite separate from the 1981 lease. It does not appear to incorporate into the 1981 lease the terms of the 1998 agreement. Thus any breach of the terms of the 1998 agreement is not expressed to have effect as a breach of a covenant in the 1981 lease. It is also to be noted that the 1998 agreement is expressed to be supplemental not only to the 1981 lease, but also to the 1995 underlease. I do not know if Ganton would go so far as to suggest that the underlease is varied in a similar way to that in which it argues the 1981 lease was varied. For these reasons, it seems to me that Punch has a plainly arguable case on the first ground.
11. Second, Mr Tanney submits that the judge was wrong because the parking rights were not "enjoyed ... in connection with the holding", in the words of section 32(3) of the 1954 Act, as would be required to enable the court to include the parking rights in an order made under section 29 for a new tenancy. He says that the relevant date for determining whether the rights are enjoyed with the holding is the date of the renewal hearing rather than the date of the expiry of the term of the lease.
12. Mr Tanney referred me to the case of Kirkwood v Johnson (1979) P&CR 392, and, in particular, the remarks of Ormrod LJ at page 397 and of Geoffrey Lane LJ at page 398. He points to the fact that, under the 1998 agreement, Mr and Mrs Tucker were parties and indeed received the £5,000 consideration payable thereunder. He submits that that consideration was given only for the remainder of the term of the 1981 lease, and that they could not be bound by any grant to Ganton pursuant to an order under section 29. He submits, therefore, that the term of the parking rights, came to an end on the expiry of the 21-year term of the 1981 lease, and, accordingly, the court could not treat the parking rights at the renewal hearing as being still enjoyed in connection with the holding.
13. It seems to me that this point, too, is properly arguable and cannot be said to have no real prospect of success.
14. Accordingly, for the reasons given, I would extend time for lodging the appellant's notice and I would give permission to appeal to Punch on both the grounds which it wishes to argue.
Order: Permission to appeal allowed. Estimated length of hearing 2 hours. Costs of application to be costs in the appeal.