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You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> Thomson v. Edinburgh City Council [2005] ScotCS CSOH_77 (17 June 2005)
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Cite as: [2005] ScotCS CSOH_77, [2005] CSOH 77
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Thomson v. Edinburgh City Council [2005] ScotCS CSOH_77 (17 June 2005)
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OUTER HOUSE, COURT OF SESSION [2005] CSOH 77 |
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A330/05
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OPINION OF LORD BRACADALE in the cause RONALD THOMSON Pursuer; against EDINBURGH CITY COUNCIL Defenders:
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Pursuer: Simpson; DLA
Defenders: Dunlop; City of Edinburgh Council
17 June 2005
[1] This case came before me on the motion roll on a motion for interim interdict. The pursuer trades as "Child's Play Nursery" at premises at 8 Falcon Road, Edinburgh. These premises are owned by the defenders. The pursuer avers that in June 1996 he took entry to the subjects under assignation of a lease between the defenders and a Hearts Social Club. He avers that he spent some £270,000 on a refurbishment programme of the subjects, in order to bring them up to the standard required to operate a children's nursery. The lease was due to expire in April 2004. In June 2003, negotiations began for a new lease. It is averred that in April 2004, the period of let was extended for one year by tacit relocation. [2] On 17 December 2004, agents for the pursuer wrote to the defenders. It is clear from the terms of this letter that negotiations were ongoing and that there was concern on the part of the pursuer that the defenders might see fit to issue a notice of intention to terminate the lease. The agents sought to persuade the defenders that this would be an inappropriate step, as they did not wish the parents of children at the nursery to have an indication that there were problems. Six days later, on 23 December 2004, the defenders sent to the pursuer a demand for the half year rent to June 2005. On 11 January 2005 the defenders replied to the pursuer's agent's letter of 17 December. In this letter, the defenders indicated that they were willing to offer a new lease agreement to the pursuer. There was an issue as to whether this should be a building lease or a ground lease as suggested by the pursuer. Paragraph 3 of the letter is in the following terms:"To date, the Council has shown a willingness to offer a new lease agreement to your client and has made it quite clear that the agreement will be a Building Lease and not a Ground Lease as your client has suggested. This situation has not altered. It is imperative therefore that, if your client wishes to continue leasing this property, agreement requires to be reached by 21 January 2005 to allow the provisionally agreed terms and conditions to be incorporated into the report to the executive of the Council on 15 February 2005."
The letter concludes:
"I would be grateful therefore if your client's representatives could immediately contact Jim Hamilton on 529 4357 to agree terms and conditions for a new Building Lease Agreement in order that this may be reported to the Council's executive on 15 February 2005. Failure to do so will result in the report being submitted informing the executive that, following negotiations with your clients, the Council has been unable to reach agreement on the terms and conditions of a new lease and seek authority to take the necessary steps to terminate your client's existing lease and advertise the availability of the nursery for let on the open market."
In response to the demand for rent to June 2005 the pursuer sent a cheque which was cashed by the defenders on 9 February 2005. One week later, on 16 February 2005, the defenders served a notice to quit. One month after that, on 15 March 2005, the defenders issued a credit note in the sum of £585.89, being the amount of the rent between 1 April and 30 June 2005. The pursuer returned this to the defenders. On 29 March 2004, the pursuer challenged the notice to quit and served a notice of arbitration. On 1 April 2005 the lease expired but the pursuer remained in occupation of the premises founding on tacit relocation.
[3] Against that background, Mr Simpson, who appeared on behalf of the pursuer, moved me to grant interim interdict. He submitted that the notice to quit was void, the defenders had demanded rent to June 2005, and negotiations had continued to take place. Mr Simpson submitted that the pursuer had acted reasonably in proceeding on the basis of tacit relocation. So far as the balance of convenience was concerned, the premises were occupied by the pursuer for an ongoing business and represented his livelihood. In addition, children were attending the nursery and continued to do so. In these circumstances he submitted that the balance of convenience favoured the pursuer. [4] Mr Dunlop, who appeared on behalf of the defenders first of all pointed out that the nature of the interdict sought by the pursuer was meaningless. The pursuer sought to interdict the defenders from "instituting diligence on the basis of the purported notice to quit". Mr Dunlop pointed out that no diligence could be carried out on the basis of the notice to quit. It was a necessary provision that Court proceedings to evict had to be raised and the pursuer could defend such proceedings. In order to meet this point, Mr Simpson offered to amend the third conclusion to interdict the defenders from "raising an action for removing". [5] In addressing the merits of the motion for interim interdict, Mr Dunlop submitted that the pursuer had failed to set out a prima facie case. Mr Dunlop submitted that this was an action for reduction of the notice to quit based on personal bar. Mr Dunlop submitted that personal bar could prevent a party from relying on a deed or act but it was hard to see how it could amount to grounds for reduction. Under reference to Maclaine v Gatty [1921] 1 AC 376 Mr Dunlop submitted that personal bar arose where A induced a state of belief in B and B acted on that to his prejudice. Mr Dunlop suggested that having regard to the chronology of events and, in particular, to the correspondence, it was plain that the pursuer had no doubt as to what was likely to happen. Any mistaken belief was corrected by the letter from the defenders dated 11 January. It was necessary for the pursuer to show that he acted on the belief to his prejudice. The only prejudice which the pursuer averred was that he had discontinued his efforts to find alternative premises for his business. [6] Mr Dunlop submitted that if I was against him on his submission that there was no prima facie case, the balance of convenience favoured the defenders. If there was a prima facie case, it was a weak one. There was another remedy. The defenders could not recover possession of the subjects without first obtaining a court order. They would require to raise an action in the Sheriff Court and the pursuer could defend the action. [7] Looking at the averments of the pursuer, together with the correspondence in the defenders' inventory of productions, and considering matters in the round, I was not prepared to accept the proposition advanced by Mr Dunlop that the pursuer has completely failed to demonstrate a prima facie case. Accordingly, it seemed to me appropriate to decide the matter on the balance of convenience. In assessing where the balance of convenience lay I considered first the strength of the pursuer's case. I came to the view that the pursuer's prima facie case was weak, particularly in the light of the clear terms of the correspondence between the agents acting for the pursuer and the defenders. The terms of the letter from the defenders dated 11 January 2005 made the position very clear despite the demand for rent and the cashing of the cheque. Next, I had regard to the protection afforded to the pursuer by the need for the defenders to obtain a court order before proceeding to eviction and the consequent opportunity for the pursuer to defend that action and remain in the premises meantime. In my opinion the law is correctly stated in the Scottish Law of Leases 3rd edition (McAllister) in a passage to which I was referred by Mr Dunlop at page 218 in Section 9.30:"The most important point to note is that the landlord can only remove the tenant by means of a court action. This will give the tenant the opportunity to lodge a defence, and only if the court eventually grants a decree of removing will the landlord be in a position to proceed with an eviction."
In my opinion, the proper place for the issue to be addressed is in the context of court proceedings for eviction. On the other hand I had regard to the desirability that the children's nursery should continue to operate meantime. The requirement for the defenders to raise an action in the Sheriff Court, which action could be defended by the pursuer, would allow the nursery to continue to operate meantime. This would allow the children to continue to attend and the pursuer to maintain his livelihood. In addition, it seemed to me from the history of negotiations that there was at least a prospect of negotiations being revived. In all the circumstances I considered that the balance of convenience lay in refusing the motion for interim interdict, which I did.