Case BriefsForeign Courts

Supreme Court of the United Kingdom: A Full Bench of Lord Briggs (President), Lord Carnwath, Lord Hodge, Lord Wilson and Lady Arden, JJ. allowed the appeal by a majority of three to two. Lord Briggs gives the main Judgment with which Lord Carnwath and Lord Hodge agree. Lady Arden and Lord Wilson each give a dissenting Judgment with respect to withholding consent of the landlord.

Hautford Ltd. was a tenant of a whole building in Soho under a 100-year lease. The lease is permitted that the whole property is to be used for residential purposes, however, at the time when it was granted in 1986 only the top two floors were used for residential purposes. Around 2013 the tenant developed other floors of the building into residential flats and then sought planning permission for the change of use. The lease contained a provision that the tenant must obtain the landlord’s consent not to be unreasonably withheld for any application of planning permission. The tenant sought consent from the landlord, Rotrust Nominees Ltd., which was ultimately refused. The landlord’s ground for withholding consent were on the basis that by turning the whole building into residential use, the tenant could have a strong claim under the statute for enfranchisement meaning to compel the landlord to sell the freehold to the tenant.

The High Court and the Court of Appeal both ruled that refusing consent based on the risk of enfranchisement was unreasonable when taking into account that the lease permitted use of the whole building for residential purposes.

Lord Briggs delivered the majority opinion and remarked that the case was not one with complex disputed fact nor did it deal with complicated points of law. Rather it deals with one simple question: did the landlord act was reasonable or unreasonable.

The Court summarised the established principle which is to be followed when assessing whether a party has acted reasonably:

  • The grounds for withholding consent must be to do with the relationship of landlord and tenant in regard to the subject matter of the lease. 
  • Decisions should be based on the specific facts and care must be taken “not to elevate a decision made on the facts of a particular case into a principal of law”. 
  • The conduct only has to be reasonable it does not need to be right or justifiable.

With respect to the first test, Lord Briggs held that the real risk of enfranchisement was central to a landlord and tenant relationship and in relation to the third test; he held that enfranchisement would clearly adversely affect the landlord’s reversionary interest which was an essential type of consideration that the refusal of consent was reasonable.

Lady Arden and Lord Wilson disagreed with the majority holding and upheld the reasoning of the Court of Appeal and the High Court.

The Court granted the Appeal and considers that, on the undisputed facts; the landlord was acting reasonably in protecting the value of its property.[Sequent Nominees Ltd. v. Hautford Ltd, [2019] 3 WLR 981, decided on 30-10-2019]

Case BriefsHigh Courts

Delhi High Court: Sanjeev Sachdeva, J., allowed a petition that challenged the impugned order whereby petitioner’s application under Order 12 Rule 6 CPC for judgment on admissions was rejected.

The petitioner (landlord) had filed a suit for possession of the suit property which was owned by her. She had prayed for ejectment of the tenant-respondents. The petitioner moved an application under Order 12 Rule 6 CPC which was rejected by the trial court on the sole ground that the tenant did not make any admission as to the ownership of the petitioner and their tenancy in the suit property.

On facts, the High Court held that the trial court erred in reaching the said conclusion, as in the written statement filed by the tenant, there was a clear admission that they were tenants under the petitioner, and the petitioner was the owner of the suit property. Even the receipt of legal notice served by the petitioner for ejecting the tenants was admitted.

On the point of law, the Court noted that in a suit for ejectment, the landlord has to establish: (i) Relationship of landlord and tenant; (ii) Tenancy is not a protected tenancy under the Delhi Rent Control Act, 1958; (iii) There is no registered subsisting lease agreement; (iv) Tenancy has been terminated and the respondent tenant has failed to hand over possession.

The Court was of the opinion that since, there was an unequivocal admission of the ingredients that the landlord has to establish for seeking ejectment of its tenant, the application filed by the petitioner under Order 12 Rule 6 CPC ought to be allowed. Orders were made accordingly. [Geeta v. Mohd. Raza, 2019 SCC OnLine Del 11385, decided on 14-11-2019]

Case BriefsHigh Courts

Himachal Pradesh High Court: Tarlok Singh Chauhan, J. entertained a petition filed by a landlord against the order passed by the Rent Controller in favor of the tenant, whose supply of electricity was unreasonably disconnected by the said landlord.

Factual matrix of the case was that the tenant filed an application under Section 11(3) of H.P. Urban Rent Control Act, 1987 to the Rent Controller and contended that the supply of electricity was allegedly disconnected by the landlord without any just and reasonable cause. The Rent Controller passed an order in favor of the tenant, aggrieved by which the landlord proffered an appeal which was dismissed by the authority, hence the landlord filed the instant petition.

The main point noted by the Court was the scope of revisional jurisdiction, which the Court exercised keeping in mind judgment passed by the Constitution Bench of the Supreme Court in Hindustan Petroleum Corpn. Ltd. v. Dilbahar Singh, (2014) 9 SCC 78, where it was held that, “The expression “revision” is meant to convey the idea of much narrower expression than the one expressed by the expression “appeal”. The revisional power under the Rent Control Act may not be as narrow as the revisional power under Section 115 of the CPC but certainly, it is not wide enough to make the High Court a second court of first appeal”. Another important point held in the abovementioned judgment was, “The power of the High Court even though wider than the one provided under Section 115 of the Code of Civil Procedure is not wide enough to that of the appellate Authority.”

In the aforesaid decision, the Supreme Court was dealing with the provisions of the Kerala Buildings (Lease and Rent Control) Act, 1965, T.N. Buildings (Lease and Rent Control) Act, 1960 and Haryana Urban (Control of Rent and Eviction) Act, 1973. The incongruity in the decisions rendered by the Supreme Court in Rukmini Amma Saradamma v. Kallyani Sulochana, (1993) 1 SCC 499 was the backdrop in which the Constitution Bench was called upon to decide the scope of the revisional jurisdiction and the expression “legality and propriety” provided in the relevant statues. The essential question being as to whether in exercise of such powers, the revisional authority could reappreciate the evidence or not. It was held, “A finding of fact recorded by court/authority below, if perverse or has been arrived at without consideration of the material evidence or such finding is based on no evidence or misreading of the evidence or is grossly erroneous that, if allowed to stand, it would result in gross miscarriage of justice, is open to correction because it is not treated as a finding according to law.”

The High Court hence based on the above-discussed judgment and considering the exposition of law opined that, admittedly the electricity supply to the premises let out to the tenant had been disconnected by the landlord on the ground of nonpayment of such charges. Even though there appeared to be some dispute regarding rate of rent, but that by itself was not sufficient ground and could not have been made the basis for the landlord to disconnect the electricity supply to the premises let out to the tenant. The Court further held that, ground on the basis of which, electricity was disconnected was that the tenant had failed to pay the electricity charges the Court did not consider it as a sufficient ground to disconnect the electricity supply, more particularly, when it had been proved on record that there is submeter installed in the premises. It was further opined by the Court that once that be the admitted position, then obviously nonpayment of the amount due, if any, on account of electricity consumption would be a matter between electricity department and the tenant and it would be the prerogative of the aforesaid department to disconnect the electricity supply as per rules in case the electricity charges are not deposited.

The Court decided that the instant petition was frivolous and a perfect case where a heavy fine was to be imposed and dismissed the petition as it had no merits.[Ramesh Thakur v. Roshini Chauhan, 2019 SCC OnLine HP 1135, decided on 22-07-2019]

Case BriefsHigh Courts

Himachal Pradesh High Court: The instant petition involved a question that whether the eviction of tenant could be ordered for settling married son of the landlord under Section 14(3)(a)(i) of H.P. Urban Rent Control Act, 1987, even the same was not covered by Section 14(3)(d) of the Act. The same question was contemplated by Tarlok Singh Chauhan, J.

Factual matrix of the case was that the landlord filed a rent petition under Section 14 of the Act of 1987, before the Rent Controller. He sought eviction of the tenant on the ground that his son intended to settle his business in the same premises and that since he and his wife were old, they wanted to live with their son at Solan. The landlord also claimed arrears of rent and sought eviction on the ground of material addition and alteration being carried out by the tenant in the premises in question.

The tenant contested the petition tooth and nail and denied the grounds taken in the petition seeking his eviction from the premises in question. Subsequently, an order was passed in favor of the landlord and the tenant-petitioner was directed to be evicted on the grounds of non-payment of arrears of rent and that the son of the landlord needed the premise for the running business. The tenant was aggrieved by the order and he went into an appeal, the appellate authority dismissed his appeal and hence, the tenant had no other option but to file the instant petition.

Pratap Singh Gover, counsel for the landlord, relied on cases where the similar reiteration of law was found in the Judgments, Nand Lal Sharma v. Bimla Sharma, HLJ 2007 (HP) 1112; Jasvinder Singh v. Kedar Nath, HLJ (2012) (HP) 1452; Jagat Ram Chauhan v. Avinash Partap, HLJ 2014 (HP) 420 etc. further the counsel presented the witnesses, one of them was the son of the landlord, who testified that the said premise was needed by them, as his parents were old and he wanted to start his own business, but for the time being he was residing in Delhi.

On the contrary, tenant appeared as a witness and deposed that son of the landlord was residing abroad in Mexico and was doing business there and he had no intention to shift or settle at the said premise. He stated that the landlord intended to sell the tenanted premises and the proposed buyer had been forcing the landlord to get the tenanted premises vacated and in order to give vacant possession to the buyer, the landlord had concocted false plea of bona fide requirement.

The Court after the submissions of the parties observed that, there was no reason to doubt the bona fide requirement of the landlord as admitted, he was a senior citizen aged about 83 years and thus required someone to look after him and his property. The testimony of the son of the landlord was also not doubted. It was further observed that the tenant had no proof of what he alleged that the landlord wanted to sell the premise. Hence, the Court found no merit in the petition and dismissed the same.[Mandeep Singh v. Gian Chand, 2019 SCC OnLine HP 1029, decided on 18-07-2019]

Case BriefsHigh Courts

Sikkim High Court: Bhaskar Raj Pradhan, J. confirmed a decree of eviction passed against the appellant-tenant by the District Judge on the bonafide requirement of the landlord.

The sole ground for eviction being contended in the application was the requirement of suit premises for the personal occupation of the landlord. Under the relevant statutory notification, the landlord could evict the tenant only on showing the bonafide requirement for personal occupation. A holistic reading of the plaint suggested that the landlord required the suit premises as his house was in a dilapidated condition; his ill health including mental illness for which he desired to accommodate a help; to accommodate his growing children who did not have adequate personal space in the house and who were pestering him for it which was causing him mental stress; to establish them in business as they were completing their education; etc.

The appellant -tenant was represented by Laxmi Chakraborty and Manju Rai, Advocates. Per contra, Zangpo Sherpa, Deven Sharma, Jushan Lepcha and Mon Maya Subba, Advocates represented the respondent-landlord.

On perusal of the record, the High Court found the facts as claimed of the landlord to be true. Referring to its earlier case in Pradeep Golyan v. Durga Prasad Mukhia, 2016 SCC OnLine Sikk 225, the Court observed: “That personal occupation of the landlord includes the requirement of the dependents as well is now well settled.” The landlord pleaded hardship and proved it. He proved a bonafide requirement of personal occupation. Furthermore, the appellant did was unable to show any special equities in his favour against the eviction.

In such circumstances, the Court confirmed the decree of eviction passed by the District Judge. However, considering the fact that the appellant was in occupation of the suit premises and doing his business from there since 1999, he was given four months’ time to vacate the suit premises on the condition that he will continue to pay rent till then. [Bishnu Prasad Bhagat v. Prakash Basnett, 2019 SCC OnLine Sikk 84, decided on 15-06-2019]

Case BriefsHigh Courts

Kerala High Court: The Division Bench of Hrishikesh Roy and A.K. Jayasankaran Nambiar. JJ. dismissed a writ appeal filed by landlord against an order dispensing with the requirement of his consent, for renewal of his tenant’s trade licence.

A partnership firm (tenant) – Vijaya Jyothi Traders ­– had filed an application before the Thrissur Municipal Corporation for a D&O (Dangerous & Offensive) licence. The Corporation refused to consider this application on the ground that the application was not supported by landlord’s (appellant herein) consent which was the mandate under Sections 492(3) and 492(4) of the Kerala Municipality Act, 1994.

In a petition filed by the managing partner of the firm (respondent herein), it was averred that averred that since there were some disputes between him and the appellant-landlord, therefore obtaining consent letter from the landlord must not be insisted for consideration of the renewal of the licence. Learned Single judge allowed the petition and directed the Corporation to consider the subject application without insisting for consent from the appellant-landlord. Aggrieved thereby, the instant writ appeal was filed.

The Court noted that the learned Single Judge had taken note of pending suits between the landlord and tenant and had also provided an opportunity of hearing to both the parties. It relied on the judgment in Sudhakaran v. Corporation of Trivandrum, (2016) 14 SCC 263 where the Apex Court while deciding the on renewal of trade licence, stated that a tenant could not be deprived of running a lawful business merely because the landlord withheld his consent. A valid tenancy has implied the authority of the landlord for the legitimate use of the premises by the tenant.

In view of the above, the Court upheld the impugned judgment. [C.S. Babu v. C. Vijayan, 2018 SCC OnLine Ker 5783, Order dated 14-12-2018]

Case BriefsHigh Courts

Delhi High Court: A Bench of Anu Malhotra, J. dismissed a revision petition filed against the order Additional Rent Controller whereby the tenant’s application for leave to defend the eviction petition under Section 14(1)(e) of the Delhi Rent Control Act, 1958 filed by the landlord was dismissed.

The landlord had filed an eviction suit against the tenant on the ground of bona fide requirement. The tenant represented by Virendra Singh, Advocate urged that the need of the landlord was artificial and mala fide. It was alleged that the landlord and the tenant were in the same business and the landlord sought to evict the tenant due to business rivalry and the landlord did not require any additional accommodation for doing any work.

The High Court perused the entire record and noted that landlord sought eviction of tenant stating that he wanted to expand his business and required the space available in the tenanted shop for bona fide purpose. It was observed by the Court that the tenant did not provide any specific details or evidence to substantiate his claims. It was further observed as well settled that “landlord is the best judge of his own needs”. In facts and circumstances the present case, it was held that there was no infirmity whatsoever in the impugned order. Thus, the petition was dismissed. [Subhash Chander Rana v. Jitender Verma, 2018 SCC OnLine Del 13239, decided on 29-12-2018]

Case BriefsHigh Courts

Bombay High Court: A Single Judge Bench comprising of A.M. Dhavale, J. dismissed a second appeal filed against the order made in first appeal wherein it was held that the plaintiffs were not entitled to claim damages for wrongful possession of rented premises by the defendant.

The plaintiffs were owners of the subject property which was let out to Nizam Government which handed it over to Zila Parishad. In the year 1990, Zila Parishad terminated its own tenancy and directed its officials yo handover the possession of the property to plaintiffs. However, this direction was not complied with. It was also an admitted fact that plaintiffs did not take any step to recover the possession of the property and were now directly before the Court claim damages for wrongful possession by Zila Parishad.

Question before the Court was “Whether the landlord would be entitled for damages after termination of tenancy if he does not take any step for recovery of possession for more than 12 years after termination?”

The High Court referred to Chander Kali Bai v. Jagdish Singh Thakur, (1977) 4 SCC 402 wherein it was observed, “if a tenant continues in possession after termination of contractual tenancy, he would not be liable for damages till the decree for eviction is passed.” In the instant case, no decree for eviction was passed. The tenant Zila Parishad itself terminated the tenancy. In such case, the landlord plaintiffs were bound to file suit for possession. He could not directly file suit for damages for the amount not agreed under the contract. Furthermore, damages by way of mesne profits can be awarded under Order 20 Rule 12 only from the date of decree for possession for the period for which the possession is wrongfully retained in spite of the decree. In such view of the matter, the second appeal was dismissed. [Arvind v. State, 2018 SCC OnLine Bom 6069decided on 10-12-2018]

Case BriefsHigh Courts

Delhi High Court: A Single Judge Bench comprising of Vinod Goel, J. dismissed a revision petition filed against the order of the Additional Rent Controller whereby he allowed the eviction petition filed by the respondent-landlord under Section 14(1)(e) of the Delhi Rent Control Act, 1958.

The petitioner was a tenant of the respondent. The respondent, in the eviction petition filed by him, had sought ejectment of the petitioner from the suit property. the ground taken by him was a bona fide requirement. It was pleaded that the suit property was required by the respondent for expansion of the business. The petitioner, per contra, submitted that the said property was not suitable for expansion of business as sought by the respondent. the Additional Rent Controller, however, decreed the suit and passed the eviction orders against the petitioner. Aggrieved thereby, he filed the instant revision under Section 25-B of the DRC Act.

The High Court, while adjudicating on the matter, referred to a Supreme Court decision in Baldev Singh Bajwa v. Monish Saini, (2005) 12 SCC 778. It was observed that whenever a landlord seeks ejectment of a tenant for bona fide requirement, it shall be presumed to be genuine and bona fide. Furthermore, the burden to rebut the said presumption lies on the tenant; however, the mere assertion on part of the tenant does not suffice. In the instant case, the testimony of the respondent as to his bona fide requirement went unrebutted. In such view of the matter, the revision petition was dismissed and the order impugned was accordingly upheld. [Metro Bearings v. Faizunnisa, 2018 SCC OnLine Del 12313, Order dated 31-10-2018]

Case BriefsHigh Courts

Delhi High Court: A Single Judge Bench comprising of Valmiki Mehta, J. dismissed an appeal filed by the appellant-tenant impugning the judgment of the trial court whereby mesne profits were awarded to the respondent-landlord.

The appellant was a tenant in the subject premises. The tenancy commenced in 1986 and was terminated in 1998 vide legal notice. The appellant in the meanwhile, during the pendency of suit for possession and mesne profits, handed over the possession of the tenanted premises to the landlord in 1999. Therefore, the mesne profits were calculated from May 1998 to August 1999 (date of filing the suit to date of handing over of possession). Against the award of mesne profits, the appellant filed the present regular first appeal under Section 96 CPC.

The High Court noted that the trial court relied on the rent paid by another tenant to calculate the mesne profits. It was also observed that some amount of honest guess work is always involved in calculation of mesne profits, therefore, once the rent paid on similar premises on same area was taken as the basis, there was no illegality in the award of the mesne profits passed by the trial court. Furthermore, the definition of mesne profits in Section 2(12) CPC provides that mesne profits include the interest payable thereon. Holding that the judgment impugned did not require any interfere, the learned Judge went on to observe that there is no inherent right in citizens of this country, who are tenants, to violate the law by overstaying in the premises where the tenancy stands dismissed. The appeal was dismissed. [Hindustan Motors Ltd. v. Seven Seas Leasing Ltd.,2018 SCC OnLine Del 11391, decided on 19-09-2018]

Case BriefsHigh Courts

Punjab and Haryana High Court: A Single Judge Bench comprising of Gurvinder Singh Gill, J., dismissed a revision petition filed assailing the order of the Appellate Authority which in turn upheld the order of Rent Controller, Ludhiana, whereby the petitioner was ejected from the property in question.

The respondent filed an ejectment petition before the Rent Controller on the grounds that the petitioner-tenant had defaulted in paying the rent since June 2008. The petitioner contended that the respondent was not the landlord as he had taken the premises on rent from one Narinder Singh. The Rent Controller found that a relationship between tenant and landlord existed between the parties. And since the petitioner defaulted in paying the rent, petitioner was ordered to be ejected from the property concerned. The Appellate Authority confirmed the findings and upheld the order passed by the Rent Controller. Feeling aggrieved, the petitioner approached the High Court.

The High Court perused the record and found that the abovementioned Narinder Singh, in his examination, had stated that he had sold the property concerned to the petitioner. A power of attorney and a Will was also executed in favor of the petitioner. The Court did not find any registered sale deed proving the factum of sale; however, the abovesaid documents showed that there was some arrangement between the petitioner and Narinder Singh whereby the petitioner exercised the rights of the landlord. The Court held the law to be well settled that a person can be a landlord even without having ownership rights in the property. The High Court did not find any infirmity in the impugned order and the revision petition was thereby dismissed. [Ashok Kumar v. Piara Singh, 2018 SCC OnLine P&H 733, dated 29-05-2018]

Case BriefsSupreme Court

Supreme Court: Deciding a short question of law as to whether the requirement of the landlord for own occupation could also mean occupation by a member of the family, the bench of Kurian Joseph and A.M. Khanwilkar, JJ said that mere non-examination of the family member who intends to do the business cannot be taken as a ground for repelling the reasonable requirement of the landlord.

According to the J&K High Court, the appellant has failed to establish her reasonable requirement for own occupation as per Section 11(1)(h) of the Jammu and Kashmir Houses and Shop Rent Control Act, 1966. Having not examined the son who intends to do the business, the requirement of own occupation was not established.

In the present case, the landlord was not happy and content with the paltry rent received from the premises and intended to engage her unemployed and uneducated son in the business at the premises. Considering the facts of the case, the Court said that the eviction is not sought on the last limb of Section 11(1)(h) of the Act namely, “for the occupation of any person for whose benefit the house or shop is held”. The premises sought to be evicted is not held for the benefit of the son alone; but the whole family. It is for the own occupation of the landlord and it is for the landlord to decide as to the best use the premises should be put to.

The Court said that the reasonable requirement by the landlord of the premises would depend on whether the landlord has been able to establish a genuine element of need for the premises which would depend on the facts and circumstances of each case. Merely because the landlord has not examined the member of the family who intends to do business in the premises, he cannot be non-suited in case he has otherwise established a genuine need. [Mehmooda Gulshan v. Javaid Hussain Mungloo, 2017 SCC OnLine SC 143, decided on 17.02.2017]

Case BriefsForeign Courts

Supreme Court of United Kingdom: In an appeal filed by a Landlord against the liability from failure to keep ‘paved area outside the building’ in repair as per the Section 11 of the Landlord and Tenant Act, 1985, the Court allowing the appeal, held that the landlord is not in breach of his statutorily implied obligation for carrying out repairs until he has the notice of the disrepair.

Section 11 of the 1985 Act applies to Sub-tenancy agreements and extends the landlord’s statutory repairing covenants to “keep in repair the structure and the exterior of the dwelling-house”. In the present case, the subtenant having tripped over an uneven stone on a paved way which was the main access to the building and suffered injuries, had brought action against the landlord for the breach of the provision. The Court of Appeals had allowed the case but in the present appeal the Court took a contrary view.

The Court held that the expressions of the obligations under the Section 11 should be given a natural meaning rather than an artificially wide one. It held that, the fact that a piece of property is a necessary means of access to a building cannot be sufficient for it to constitute part of the ‘exterior’ of that building. Therefore, the paved way did not fall within the ambit of the provision.  Moreover, the Court as an exception to the general principle upheld the rule that, the landlord is not liable under a covenant with his tenant to repair premises which are in the possession of the tenant and not of the landlord unless and until the landlord has notice of the disrepair. Relying on a number of cases which had earlier upheld the rule the Court held that the landlord  could only be held liable if he had had notice of the disrepair before the accident, which he did not have. In accordance with both the observation the appeal of the landlord was allowed. [Edwards  v. Kumarasamy  [2016] UKSC 40, decided on 13 July 2016]