Lease Covenants
Cases
O’Reilly v East Coast Cinemas
O’REILLY V. EAST COAST CINEMAS LTD.
In the year 1947 the plaintiffs granted a lease of a tenement and the lessee’s estate was assigned to the defendants in the year 1948. In the year 1951 the defendants were informed that the tenement was in a state of disrepair. In the year 1955, when the term of years created by the lease of 1947 had 12 years to run, the defendants surrendered that lease and the plaintiffs granted a new lease of the tenement to the defendants for a term of 35 years. Each lease contained a covenant by the lessee to keep the tenement in good and sufficient repair during the relevant term of years and to deliver possession at the end or sooner determination of the relevant term in such repair. The defendants allowed the tenement to fall into disrepair and, in the year 1959, the plaintiffs claimed in the High Court damages from the defendants for breaches of the covenants for repair. At the trial of the action the defendants contended that the plaintiffs, by accepting the surrender and by granting the lease of 1955, had waived any existing claim for damages for breach of the covenant to repair contained in the lease of 1947.
The defendants also relied on the provisions of s. 55 of the Landlord and Tenant Act, 1931, which provide that, unless a state of disrepair is shown to have been due to ‘wilful damage or wilful waste committed’ by the lessee, no damages shall be recoverable for the breach by a lessee of a covenant to repair contained in a lease of a tenement if it is shown that it would be impossible or uneconomic to repair the tenement (see nows. 65 of the 1980 Act, p.555. ante). It was agreed that the repair of the tenement would not be an economic proposition and the defendants submitted that the plaintiffs had not shown that the state of disrepair of the tenement was due to ‘wilful damage or wilful waste committed’ by the defendants. In dismissing the plaintiffs claim it was held by Davitt P., 1, that the plaintiffs had not waived their claim for damages for breach of the covenant to repair contained in the lease of 1947. 2. That that the defendants, intentionally and deliberately, had taken no action to repair the tenement while it fell into rack and ruin but that the defendants’ inaction did not constitute wilful damage or wilful waste committed by them within the meaning of s. 55 of the Act of 1931, as interpreted by the Supreme Court in Gilligan v. Silke [1963] LR. 1. The plaintiffs appealed to the Supreme Court.
6 Dalaigh C.J.:
This appeal, which is from a judgment of the former President, Davitt P., is concerned with the correct interpretation of s. 55 (b) of the Landlord and Tenant Act, 1931. The meaning of this section was considered by this Court in Gilligan v. Silke ([1963] I.R. 1). The former President took the view that the case precluded him from finding in favour of the plaintiffs. He therefore dismissed the action with costs.
The judgment of Davitt P. sets out the facts and circumstances of the case at length. For the purpose of this appeal it will suffice to present a brief summary. The action is for damages for breach of covenant to repair. The premises in question are in Bray, Co. Wicklow. It would appear that they were created about the middle of the last century, and at different times they have been used as assembly rooms, Turkish baths, a skating rink and latterly as a cinema. User as a cinema commenced some time prior to the year 1936 and continued until August, 1947, when a fire occurred in the operating box in the gallery. The fire did not do much damage. It was necessary to close the cinema pending the carrying out of certain alterations required by the local authority. The premises have not been re-opened since then. The building consists of a hall or auditorium with an arched roof and two subsidiary structures. The first of these is a flat-roofed vestibule in the front of the building, and the second is a return building a,t the rear containing toilets and cloakrooms. The roof of this latter building is A0 shaped.
In the year 1936, Mr. Maurice Baum acquired the lessee’s interest from a Mrs. McDermott; the McDermott lease expired in 1946. On the 1st April, 1947, the plaintiffs as lessors granted a new lease to Mr. Baum for a period of 21 years from the 1st May, 1946, and in May, 1948, he assigned his interest under the lease to the defendant company of which he is a managing director.
The work required to be done by the local authority following the fire included a provision for a projection box which would be exterior to the premises of the lessees and would overhang the adjoining premises of the lessors. The lessors refused their consent to this structure and, in the result, the alterations were never carried out. In the year 1949 the defendants decided to abandon the idea of reconstructing the premises as a cinema and instead to re-plan them as a repertory theatre. Their architects, Messrs. Good & Siberry, prepared plans and specifica tions for submission to the lessors. The lessors’ approval was given in January, 1949, and subsequently in 1951, after certain modifications were agreed upon, the approval of the local authority was obtained.
Up to the year 1952 it was necessary to obtain a licence from the Department of Industry and Commerce to carry out the reconstruction work envisaged. The only licence which could be obtained was to do work for a cost not exceeding £500 in each year, and for a period of about 4 years the defendants carried out a consider able amount of demolition work. This demolition work may be summarised as follows. The balcony and operating box and the box-office in the vestibule were removed; the front wall between the two entrance doors was broken down to make way for a wider new entrance; the inner wall openings were built up and new ones made; and defective plaster was hacked off the walls. It also appears that during this period of 4 years lead was stripped from the flat roof of the vestibule and from the valley gutters of the return building, but no evidence was given as to how this occurred or who was responsible for it.
When, in 1952, a licence was no longer required for building work, the defend ants were faced with raising money to carry through their plans. One of the difficulties was the comparatively short term of their lease. After negotiations with the plaintiffs, the lease of 1947 was surrendered and a new lease for a longer term granted. This is the lease of the 12th March, 1955, which granted the premises for a term of 35 years from the 1st January, 1955. Notwithstanding the grant of a longer term, the defendants appear to have been unsuccessful in finding the necessary finance for the work involved and nothing more was done. The defendants eventu ally went into voluntary liquidation and in April, 1963, the liquidator surrendered possession of the premises to the plaintiffs. The present proceedings were instituted in 1959 but did not come for hearing until May, 1966.
Davitt P. held that the defendants, intentionally and deliberately, stood by and did nothing in the way of necessary repairs while the premises literally went to rack and ruin. The dilapidated state and condition of the premises was, however, in his view not due to the demolition work which the defendants had carried out. He found that the real cause of the failure was the defendants’ failure to keep the premises weatherproof. While defects in the main roof (which the lessors cove nanted to keep in repair) may have contributed to the appearance of dry rot, this was not the main cause. The principal cause, as found by Davitt P., was the failure to make the roof of the return building at the rear stauch and weatherproof after the lead gutters had been stripped. In addition Davitt P. held that considerable damage must also have resulted from the failure to replaster the walls after the old plaster had been hacked off. He summarised his findings by saying: ‘In short, it was not the acts of demolition whcih caused the damage; it was the failure to secure the premises, temporarily at least, from the effects of the weather during and after the work of demolition.’
Although Davitt P. held that the defendants, intentionally and deliberately,
stood by and did nothing in the way of necessary repairs while the premises literally went to rack and ruin, he nevertheless was of opinion that this did not amount to wilful waste within the meaning of s. 55 (b) of the Act of 1931 as interpreted by this Court in Gilligan v. Sike ([1963] I.R. 1). He said that in that case Maguire J. ‘took the view that to constitue wilful waste there would have to be some act or acts committed by the lessee deliberately and intentionally directed towards the spoli ation of the tenement.’ That had not been established in this case, and he therefore dismissed the plaintiffs’ action.
The evidence with regard to the stripping of gutters of the vestibule and return building can be disposed of shortly. The plaintiff, Mr. O’Reilly, was unable to say by whom the lead had been removed; he did not see the actual stripping. Mr. Baum, for the defendants, said that all they did was to put rubberoid on the return building and that no one, to his knowledge, had stripped the lead from either of these buildings. He added that he had not heard of lead being removed until the hearing in court that day. One may summarise the effect of this evidence by saying that the plaintiff did not establish that the stripping of lead from the roof of the vestibule and of the return building was part of the demolition work carried out by the defendant company. The position therefore appears to be that the condition of the roofs of these two buildings is not to be ascribed to any positive action upon the part of the defendants, but that it is due rather to wear or tear and to the action of some third party for whom the defendants are not responsible.
On the 19th November, 1951, the Town Engineer, Mr. Healy, wrote to Mr. Siberry, the defendants’ architect, calling his attention to the fact that the roofs of the annexes were leaking rather badly and would need considerable repairs. Notwithstanding this, no step whatever was taken by the defendants to make the roofs of these buildings weatherproof and, as Davitt P. has found, the defendants intentionally and deliberately abstained from doing the necessary repairs. It was this action on their part which he said was the principal cause of the dilapidated condition into which the premises later fell.
The defendants’ conduct amounted to wilful permissive waste, that is to say,being aware of the leaking state of the roofs of the annexes from, at latest,November, 1951, they took no steps, intentionally and deliberately, to prevent the premises falling into a dilapidated condition. Davitt P. clearly interpreted Gilligan
v. Silke ([1963] LR. 1) as holding that wilful permissive waste was not wilful waste within the meaning of s. 55 (b) of the Act of 1931.
Kingsmill Moore J., who delivered the first judgment in the Supreme Court in Gilligan’s Case ([1963] I.R. 1), was of opinion that there were certain items of damage in that case which would fall under the heading of ‘wilful waste’ and, as Davitt P. had not decided that question in Gilligan’s Case ([1963] I.R. 1), he would have sent the case back for retrial on this point. At p. 20 of the report Kingsmill Moore J. defined ‘wilful’ as meaning ‘conscious and deliberate’ or, as he put it later, as ‘something deliberate and intentional, something which involves a choice of courses, something to which the mind and will is a party.’ He was also of the view that ‘waste’ was a term of legal art and, as such, was divided into ‘voluntary waste’ and ‘permissive waste’. Moreover, he was clearly of the view that the verb ‘com mit’, in the context of the phrase ‘wilful waste committed’, covered acts of omission as well as acts of commission and he cited old and established authority for this view. Both Maguire J. and Lavery J. were of opinion that Sheila Gilligan’s action should be dismissed. At the invitation 9f Lavery J., who presided, Maguire J. delivered his judgment before that of Lavery J. Lavery J. in his judgment agreed with Maguire J. In the course of his judgment expressing his agreement, Lavery J. stated (at p. 31 of the report) what he understood Maguire J. to have decided. Lavery J. said: ‘Mr. Justice Martin Maguire has also fully explained his view as to the meaning of the term [wilful waste] and is of opinion that mere “permissive waste” cannot be considered “wilful waste” and that what was done, or rather omitted to be done, here was permissive waste only.’ Later, at p. 32 of the report, he pointed out that ‘wilful’ qualified both ‘damage’ and ‘waste’ and said he thought the word must be given the same meaning in both cases.
I turn now to the judgment of Maguire J. At p. 27 of the report, in dealing with the terms ‘wilful damage’ and ‘wilful waste’ he said: ‘In their ordinary meaning they contemplate some acts that are deliberate and intentional. I find myself quite unable to accept the argument that they mean nothing more than spontaneous or accidental, or that they can be construed as implying merely permissive waste in the ordinary meaning attributed to that phrase.’ He returned to the same idea at p. 28 of the report where he said that: ‘One might say that if the Legislature had meant by “wilful waste” merely permissive waste it could readily have said permissive waste or, simply, waste, without introducing this new expression, “wilful waste”. If knowledge of the existing law must be imputed to the draftsmen of this Act, then I think they went more than a little out of their way to introduce a provision new to the law to effect a departure from well established precedent. The onus of showing wilful damage or wilful waste committed by the tenant is thrown upon the landlord. “Waste” must be construed as a term of art. But “wilful waste” is a new term, found for the first time in this Act of the Irish Legislature.’ Finally, at p. 29 of the report, he concluded with these words ‘In this case there is no evidence of wilful waste, no evidence of any act committed by the defendants deliberately and intentionally directed towards the spoliation of the tenement.’
It was in these last words that Davitt P. in the present case saw the gist of the decision of the majority of the Supreme Court in Gilligan’s Case ([1963] I.R. 1). From the earlier citations from the judgment of Maguire J. it is clear that he is insisting that wilful waste is not permissive waste merely, that the term ‘wilful’ adds something to ‘waste’ and that ‘waste’ must be construed as a term of legal art. As such, it includes ‘permissive’ as well as ‘voluntary’ waste. He never receded from this view. The words, in the judgment of Maguire J. in Gilligan’s Case ([1963] IR.1), which led Davitt P. in this case to think that Maguire J. was excluding from the term ‘wilful waste’ wilful permissive waste are the words: ‘ act committed by the
defendants deliberately and intentionally directed towards the spoliation of the tene ment.’ If by these words Maguire J. meant to convey that there must be a positive act on the part of the lessee (i.e. committed by the lessee), then what he was saying was wholly inconsistent with the nature of permissive waste as accepted by him earlier in his judgment, not alone this, but he was overlooking, as Kingsmill Moore J. pointed out in his judgment, that, while the verb ‘commit’ ordinarily applies to something done actively, it is common to talk of committing an error, fault, or sin, and that the error, fault, or sin may be one of omission. Moreover, and more significant, words like do or make waste (firmarii vastum non facient in the Statute of Marlbridge or que aver fait vastum in the Statute of Gloucester) have long since been understood to cover passive as well as active waste. I see in the words ‘directed towards the spoliation of the tenement’ in the judgment of Maguire J. nothing additional to what is contained in the words ‘deliberate and intentional,’ that is to say, that the lessee is conscious and well aware of the likely result of his omission. It should, moreover, be pointed out that, having reached the view that the acts of waste alleged against the lessee in Gilligan’s Case ([1963] LR. 1) were merely permissive waste, the additional words of Maguire J., which misled Davitt
P. in this case, were obiter.
I cannot construe the judgment of Lavery J. in Gilligan’s Case ([1963] LR. 1) as rejecting the concept of wilful permissive waste. If the judgment of Maguire J. can be construed as doing so, it is at variance with the views of the other two members of the Court in that case and, as I have indicated, it is quite at variance with the long-established meaning of the term ‘waste’. Lavery J., as I have pointed out, was at pains to underline that the argument which was being rejected was that ‘wilful’ added nothing to mere permissive waste; and, further, that the acts alleged against the lessee in Gilligan’s Case ([1963] LR. 1) were in the view of Maguire J., and also in his view, permissive waste only.
The result of this analysis is to show that Davitt P. was in error in this case in the
view that Gilligan’s Case ([1963] LR. 1) has laid down that ‘wilful waste’ ins. 55 of the Act of 1931 did not extend to wilful permissive waste. On a careful reading of that case it appears that the Court (or at least two of its members) accepted the contrary view; that is to say, that ‘waste’ as a term of legal art necessarily included permissive as well as voluntary waste. In the result this appeal should be allowed, and judgment should be entered for the plaintiffs and the matter remitted to the High Court to fix damages.
Haugh J.: I agree. Walsh J.: I agree. Budd J.: I agree. FitzGerald J.: I agree. Notes and Questions
Rice v Dublin Corporation
RICE V. DUBLIN CORPORATION
[1947] I.R. 425; 88 I.L.T.R. 103 (Supreme Court)
A plot of ground was compulsorily acquired by the defendants under the Housing of the Working Classes (Ireland) Acts, 1890 to 1921, and leased to the plaintiffs in separate parcels. Each lease contained covenants by the lessee (a) to erect a two-storey shop and residence and
(b) not to permit the premises so erected to be used for the sale of intoxicating liquor. On the application by the lessees for leave to use their respective premises for the sale of intoxicating liquor, the defendants refused their consent without assigning any reason. The plaintiffs thereupon instituted proceedings for declarations that the defendants had unreasonably withheld their consent. It appeared from the evidence that the defendants’ refusal was based upon their general policy not to permit the sale of intoxicating liquor in any premises on their new housing estates. Davitt J. stated a case for the Supreme Court.
Maguire C.J.:
These two Cases stated by Davitt J. raise for our consideration and determi nation the same questions. Each plaintiff is the lessee of a plot of land which has been compulsorily acquired bf the defendants under the provisions of the Housing of the Working Classes Acts, 1890 – 1921. The plots were demised by the defend ants to the original lessee in each case, for a term of 150 years and in each case contained. a covenant that the lessee wbuld, within twelve months, on the site so demised, erect a two storey premises co;nsisting of a shop on the ground floor and a residence on the upper floor, of such design and material as should meet with the approval of the housing architect qf ‘the defendants. Each lease, furthermore, contained a covenant by the lessee not to permit or suffer the premises or any part thereof to be used for the sale of intoxicating liquor or occupied as a brothel. Buildings which complied with the tern’ls of the covenant first mentioned, were duly erected by each lessee. Each plaintiff now is lessee of the premises occupied by him or her for the residue of the term of 150 years. Notwithstanding the terms of the covenant mentioned, the plaintiffs, relying upon s. 57 of the Landlord and Tenant Act, 1931, requested the defendants to consent to the user of the premises for the sale of intoxicating liquor. The defendants, without assigning any reason, refused so to consent.
Each plaintiff issued a civil bill seeking a declaration that the defendants had unreasonably witheld their consent to the premises being so used. The Circuit Court Judge granted the declaration asked for by the plaintiff in each case. An appeal was taken to the High Court. At the conclusion of the plaintiffs’ case in the High Court, counsel for the defendants asked for a direction on certain grounds which, as they are raised in the questions submitted for determination by this Court, need not be stated here. The learned Judge reserved the points raised for consideration. The defendants gave evidence which formed the basis of the findings of the Circuit Court Judge – (a) that the lands demised by the leases under which the respective plaintiffs hold, were compulsorily acquired by the defendants under the provisions of the Housing of the Working Classes Acts, 1890 – 1921, and (b) that in the year 1938 the City Manager had decided that leases on the defendants’ new housing estates should contain covenants prohibiting the use of the demised premises for the sale of intoxicating liquor; (c) that the two plaintiffs were the only lessees who had requested the defendants to waive this prohibition; (d) that the applications had been referred to the defendants’ housing committee; (e) that the housing committee as a matter of general policy decided not to consent, in the case of any lease containing such a prohibition, to the user of the premises for the sale of intoxicating liquor, and that in accordance with this policy the housing committee decided to refuse both the applications.
On the application of counsel for both parties in each case the learned Judge has stated these Cases and submits for our determination in each Case the same five questions.
The first question is: Whether the buildings erected upon the lands demised by
plaintiff’s lease were provided by the defendants under the Housing of the Working Classes Acts, 1890 – 1921, within the meaning of s. 3 of Landlord and Tenant Act, 1931. This section, so far as material, reads:
‘3. – Where the buildings on any land or premises were or are provided by a local authority under the Housing of the Working Classes (Ireland) Acts, 1890 – 1921,
or the Labourers (Ireland) Acts, 1883 to 1930, the following provisions shall have effect, that is to say: –
(a) if such land or premises is or are held by such local authority in fee simple,
this Act shall not apply in respect of such land or premises;’
It seems to me on first impression that on the facts in these cases and using the word ‘provide’ in its ordinary sense one would say that the defendants have provided the lands and the original lessees have provided the houses. It is con tended, however, tha because the sites leased to the plaintiffs were acquired by the defendants by the exercise of compulsory powers given to local authorities to enable them to provide sites for houses and because the defendants have secured the building of the houses in question by requiring from each lessee of a site a covenant to build, that the defendants can be said to have ‘provided’ the houses which were built in pursuance of such covenants. To say so, however, is, to my mind, unduly to extend the meaning of the word ‘provide’. In my opinion the lessees who caused them to be erected and who made available the moneys wherewith they were built, directly and primarily provided the houses. It is only indirectly and in a secondary sense that the defendants can be said to have done so. In my opinion the aim of s. 3 of the Landlord and Teanant Act, 1931, is to take away from the operation of the Act only those houses for the erection of which a local authority is directly responsible.
The first question submitted for our determination should, therefore, be
answered in the negative.
The second question submitted by the learned Judge is:
‘If the Landlord and Tenant Act, 1931, applies to the lease in question, is the agreement in the lease not to use the demised premises for the sale of intoxicating liquor an agreement prohibiting the alteration of the user of the premises within the meaning of s. 57, sub-s. 1, of the said Act?’
It is contended by Mr. FitzGerald that a contravention of the prohibition con
tained in the covenant would not be an alteration of user. It would be otherwise, he argues, if the terms of the lease tied the premises to a particular user. It seems to me, however, if, as here, the effect of a covenant is to prohibit the user of the premises for a particular purpose, that to use the premises for this purpose is to alter the user of the premises.
Accordingly, the second question should be answered in the affirmative.
The third question submitted is: – ‘If the answer to the second question is in the affirmative does the said agreement absolutely prohibit such alteration of user within the meaning of the sub-section?’
The purpose of the Landlord and Tenant Act, 1931, as indicated in the long title,
is further to improve and ameliorate the position of tenants in urban areas. Part VI of the Act which includes s. 57 is devoted to the easing of the position of tenants in regard to the type of covenant which in many cases bears hardly on tenants. Sect. 55 limits the liability of a tenant who is guilty of a breach of a covenant to repair. Sect. 56 mitigates the harshness of covenants against alienation. In sub-s. 1 it provides that covenants absolutely prohibiting or restricting alienation, either generally or in a particular manner, shall have effect as if such covenant were a covenant against alienation without the consent of the lessor. There, the contrast is between covenants which allow of no escape from their prohibitory terms and covenants which are similar but from which there is an escape if the consent of the lessor be obtained. The Legislature have thus modified the rigidity of such prohibi tory covenants by introducing a qualification which reasonable landlords in practice have accepted. In order that the new proviso shall not be rendered nugatory the section also introduces, by sub-s. 2, a proviso that the landlord’s consent shall not be unreasonably witheld. Sect. 57, which is the section we are concerned with here, deals with covenants restrictive of user. Sub-s. 1 reads as follows: –
‘Every lease (whether made before or after the passing of this Act) of a tenement which contains a covenant, condition, or agreement absolutely prohibiting the alteration of the user of such tenement shall have effect as if such covenant, condition, or agreement were a covenant, condition or agreement prohibiting the alteration of the user of such tenement without the licence or consent of the lessor.’
The wording of this sub-section is almost similar to that of sub-s. 1 of s. 56.
To my mind, construing the section by reference to the ordinary meaning of the language employed, and having in mind the mischief which it is designed to remedy, the Legislature, in using the wbrd ‘absolutely,’ is contrasting, as in s. 56, covenants prohibiting the alteration of;user from which there is no possibility of relief under the terms of the covenant, with those from which the lessor may grant relief, and has modified them in the sqme way. In my opinion the word ‘absolutely’ applies to all covenants which prohibit the alteration of user bu do not leave it open to the lessee to seek from the lessor permission to alter the user. Applying this test to the covenant under consideration it seems to me clearly to be within the operation of s. 57, sub-s. 1, and must, as a result of the sub-section, have effect as if it were a covenant prohibiting the alteration of user of the premises without the consent of the lessor. I have considered Mr. FitzGerald’s ingenious argument to the contrary but in view of what I hold to be the plain meaning of the section, I am unable to accept it.
Accordingly, the third question submitted for our consideration should be answered in the affirmative.
The remaining questions give very little trouble. The fourth question is: ‘If it becomes necessary to determine the issue whether defendants’ refusal of their consent to the proposed user by the plaintiff of the demised premises was unreason able, does the fact that they gave no reason for their refusal shift to them the onus of showing that their refusal was reasonable?’
The fifth question is whether, in determining that issue, it is permissible to have regard to the fact that the defendants’ refusal of their consent was not based upon the consideration of any special circumstances of the plaintiff’s case, but was the result of a determination not to consent to the user, for the sale of intoxicating liquor, of any premises demised by lease containing a prohibition against such user. Sub-s. 2 of s. 57 is designed, as is sub-s. 2 of the preceding section, to prevent the statutory modification effected by sub-s. 1 being rendered futile by the refusal of consent of a capricious landlord. It adds a proviso that the licence or consent of the landlord to alteration of user of a tenement shall not be unreasonably witheld. The onus is on a tenant who alleges that consent has been unreasonably witheld to establish his case. This onus is not discharged merely by proving that before the hearing no reason was given by the landlord for his refusal. It is still open to the landlord to state the grounds for such refusal to the Court. It is for the Court to say whether the grounds stated are reasonable or not.
The fourth question should, accordingly, be anwered in the negative.
As regards the fifth question, I am of opinion that while it is the duty of the Court to consider each case upon its merits, there is no reason why a landlord may not properly base a refusal of consent upon grounds of general policy in relation to the management of his estate. The question whether the grounds upon which a decision to refuse consent to the alteration of the user of premises is reasonable in reference to a particular case is a matter for the Court. No general rule can be laid down because it is easy to conceive cases in which a refusal to agree to an alteration of user based on a decision of policy in the management of the landlord’s estate would be entirely reasonable. On the other hand the Court may hold that such a ground is not a reasonable ground for witholding consent in a particular case. This answers the fifth question.
Murnaghan J.:
The two Cases Stated now before the Court were heard together and were stated by Davitt J. on the hearing by him of two appeals brought by the Dublin Corpo ration against two declarations made by the Circuit Court of Dublin in favour of the respective plaintiffs. By its orders the Circuit Court declared that the Dublin Corporation had unreasonably withheld their consent to the waiver of covenants in the leases under which the respective plainiffs held their premises under the Corporation and which prohibited the premises being used for the sale of intoxicat ing liquor.
Bys. 57, sub-s. 1, of the Landlord and Tenant Act, 1931, a lease which contains a covenant absolutely prohibiting the alteration of the user of a tenement is to have effect as if such covenant were a covenant prohibiting the alteration of the user of such tenement without the licence or consent of the lessor. Bys. 57, sub-s. 2, of the same Act such a covenant shall be deemed to be subject to a provision to the effect that such licence or consent shall not be unreasonably witheld.
Sect. 3 of the Landlord and Tenant Act, 1931, however, enacts:
‘Where the buildings on any land or premises were or are provided by a local authority under the Housing of the Working Classes (Ireland) Acts, 1890 to 1921, or the Labourers (Ireland) Acts, 1883 to 1930, the following provisions shall have effect, that is to say: –
(a) if such land or premises is or are held by such local authority in fee simple, this Act shall not apply in respect of such land or premises;
(b) if such land or premises is or are held by such local authority under a lease, such local authority shall be deemed for the purposes of this Act to be the tenant of such land or premises and to be in exclusive occupation thereof.’
Paragraph 4 of the Case Stated finds: ‘The lands upon which the said premises are built were acquired by the defendants compulsorily under the provisions of the Housing of the Working Classes Acts, 1890 – 1932, and are now held by the defendants in fee simple. The Corporation did not, however, actually erect the buildings in question, but in each case they made a lease for 150 years, at rents of
£28 and £22 respectively, and in each lease was a covenant which bound the lessee, within a specified period, to erect a two-storey premises consisting of a shop on the ground floor and a residence on the upper floor in a manner to be approved of by the architect employed by the Corporation. Such a lease was made within the powers given to local authorities under the Housing (Ireland) Act, 1919. Sect. 11, sub-s. 1 of that Act enacts: –
‘Where a local authority have acquired or appropriated any land for the purposes of Part III of the Act of 1890, then, without prejudice to any of their other powers under that Act, the authority may –
(b) with the consent of the Local Government Board, ‘[now adapted to be the appropriate Minister] ‘sell or lease the land or part thereof to any person for the purpose and under the condition that that person will erect and maintain thereon such number of houses suitable for the working classes as may be fixed by the local authority in accordance with plans approved by them and, when necessary, will lay out and construct public streets or roads and open spaces on the land or will use the land for purposes which, in the opinion of the local authority, are necessary or desirable for or incidental to the development of the land as a building estate in accord ance with plans approved by the local authority, including the provision, maintenance, and improvement of houses and gardens and other works or buildings for or for the convenience of persons belonging to the working classes and other persons.’
Sect. 11, sub-s. 1, (d), which may be contrasted with s. 11, sub-s. 1, (b), just cited, enabled the local authority with the consent of the Minister, to sell or lease any houses on the land or erected by them on the land, subject to such covenants and conditions as they might think fit to impose either in regard to the maintenance of the houses as houses for the working classes or otherwise in regard to the use of the houses. ,
Paragraph 3 of each of the Cases finds specifically that pursuant to, and in compliance with, the covenant contained in.each lease the lessee erected a shop and residence on the sites respectively demised. On the facts above stated question No. 1 of each Case asks: ‘l. Were the buildings erected upon the lands demised by the plaintiffs lease provided by the defendants under the Housing of the Working Classes Acts, 1890 to 1921, within the meaning of s. 3 of the Landlord and Tenant Act, 1931?
On behalf of the Corporation it is urged that, as part of the consideration for which they parted with the land was the performance of a covenant to build, the corporation had provided the buildings. I think it is correct to say that in a constructive sense the Corporation had provided the buildings, but it is equally true that in a factual or concrete sense the lessee had provided the buildings. The Legislature must, however, in circumstances like those under consideration, have used the word ‘provided’ in only one of these two meanings. The real question involved is, therefore, which sense should be applied in the interpretation of s. 3 of the Act.
An analogous question has already come before this Court in Collis v. Earl of Pembroke ([1934] I.R. 589). In order to come within the definition of ‘building lease’s. 46, sub-s. 1, of the Landlord and Tenant Act, 1931, inter alia requires that ‘such permanent buildings were erected by the person who, at the time of such erection, was entitled to the lessee’s interest under such lease.’ In the case referred to the owner in fee simple made a lease which contained a covenant on the lessee’s part to build. The lessee did not, in fact, build, but made a sub-lease which contained a covenant that the sub-lessee should build. The buildings were erected by the sub-lessee but the lessee contended that, inasmuch as the consideration for the sub-lease was a covenant that the lessee should build, it should be held that the lessee had ‘erected’ the buildings. This view was rejected by the High Court and by this Court. In the High Court the judgment of Meredith J. which was approved in this Court, pointed out that the sub-lessess had, in fact, erected the buildings, and that if the lessee could be said to have erected the buildings this was in a secondary sense. It was held to be the plain intention of the Act that the person who should be entitled to a reversionary lease was the person who, by his labour and expense, had erected the buildings.
Ifs. 3 of the Landlord and Tenant Act, 1931, makes the Act not apply in cases like the present, lessees who, by their labour and expense, have erected the buildings will be deprived of the right to a reversionary lease and the general policy of the Act will be rendered nugatory. Further, in my opinion the Legislature recognised that under the Housing (Ireland) Act, 1919, s. 11, sub-s. 1, (d), a local authority might lease houses erected by them on the land, and that it was in reference to such cases thats. 3 of the Landlord and Tenant Act, 1931 made use of the words ‘where the buildings on any land or premises were or are provided by a local authority’. For these reasons, in my opinion, the answer to question No. 1 should be: ‘No’.
Where leases contain covenants that certain things shall not be done without the consent of the landlord, such consent not to be unreasonably witheld, if the landlord refuses his consent the lessee may do the act and contend, when it is material to do so, that the landlord’s refusal was unreasonable. This course was not available to the respective lessees in the present cases, because they cannot sell intoxicating liquors without a licence from the licensing authority and the licensing authority will not grant such a licence to do what is forbidden by the covenant. The lessees accordingly sought from the Court declarations that the landlord’s consent was unreasonably witheld. In the consideration of this matter the Cases Stated, in question No. 2, asks a question in respect of the specific covenant in each lease, viz., ‘is the agreement in the lease not to use the demised premises for the sale of intoxicating liquor an agreement prohibiting the alteration of the user of the premises within the meaning of s. 57, sub-s. 1 of the said Act?’
On behalf of the Corporation it is contended that the section is intended only to apply if a specific user of the premises is prescribed or contemplated by the parties,
e.g. to use the premises as a private dwellinghouse, and that it is only in the case of prohibition of alteration of this user that the section applies. This construction is based upon a strict interpretation of the word ‘alteration’ in connection with the words ‘absolutely prohibiting’ and is sought to be supported by a comparison with
s. 56 in which the word ‘restricting’ is used after ‘prohibiting.’ The leases in the present cases contemplate user as a shop and dwellinghouse and the covenant is in these words: ‘And that the said Lessee shall not nor will during the continuance of this demise, permit or suffer the said premises hereby demised, or any part thereof, to be used for the sale of intoxicating liquor or to be used or occupied as a brothel.’ It seems to me that the words of this covenant do ‘absolutely prohibit the alteration of the user of such tenement’ within the meaning of s. 57. The permitted user of the premises within the contemplation of the parties does not include those specified in the covenant, and this covenant absolutely prohibits the alteration of the user contemplated by the parties to the user specified in the covenant. I cannot there fore hold that the section only applies where one or more specific users are provided for and an alteration of these specific users is prohibited. In my opinion, question No. 2 should be answered: ‘Yes.’
Question No. 3 of the Cases Stated asks ‘does the said agreement absolutely prohibit the alteration of any such user within the meaning of the sub-section?’ It is only necessary to read the sub-section to see that a covenant prohibiting the alteration of the user of such tenement without the licence or consent of the lessor is contrasted with a covenant absolutely prohibiting such alteration. The covenants in the two leases before the Court do not mention the licence or consent of the lessor but are in form absolute prohibitions. This question should in my opinion be answered: ‘Yes:’
The Cases Stated find that ‘in 1938 the City Manager decided that all future leases on the defendants’ new housing estates should contain covenants prohibiting the use of the demised premises for the sale of intoxicating liquor.’ The plaintiffs are, so far, the only lessees to request the defendants to waive such a prohibition. ‘Their applications were referred to the defendants’ housing committeee. The housing committee decided as a matter of general policy not to consent in the case of any lease containing such a prohibition to the user of the demised premises for the sale of intoxicating liquor. In accordance with this policy they decided to refuse the plaintiff’s applications.’ Question No. 4 is, apparently, stated with reference to these findings. It is as follows: – ‘4. If it becomes necessary to determine the issue whether defendants’ refusal of their consent to the proposed user by the plaintiff of the demised premises was unreasonable, does the fact that they gave no reason for their refusal shift to them the onus of showing that their refusal was reasonable?’ Counsel for the plaintiffs did not seek to obtain an affirmative answer to this question. It was admitted at the hearing it was necessary that the plaintiff should establish at least a prima fade case. A prima fade case is not established merely by showing that the defendants gave no reason for their refusal. The answer to question No. 4 should be: ‘No.’
Question No. 5 of the Cases Stated is: ‘In determining that issue is it permissible to have regard to the fact that defendants’ refusal of their consent was not based upon the consideration of any speci1tl circumstances of the plaintiff’s case but was the result of a determination not to consent to the user for the sale of intoxicating liquor on any premises demised by lease containing a prohibition against such user?’ ·
It is permissible to have regard· to the fact that defendants’ refusal of their consent was not based upon the consideration of any special circumstances of the plaintiff’s case, but not as a determining factor. The unreasonableness of the defendant’s refusal may depend upon considerations which do not arise upon special circumstances of the plaintiffs’ case. For example, if it is a question of estate management or the well-being of the estate tenants as a whole, the reasonableness or unreasonableness of the refusal depends upon the facts known to the defendants at the date of refusal. In a case like those before the Court the reasonableness or unreasonableness of the refusal should depend on the facts brought to the know ledge of the Court at the date of the hearing. If the defendants gave no reason for their refusal when made, and could give no reasonable grounds at t)le hearing in Court, regard might well be given to the fact that they gave no reason when making the refusal. If, however, at the hearing a substantive case is made to rebut a prima fade case made at the hearing by the plaintiff, only the slightest regard could be given to the fact that the refusal when made was not accompanied by reasons. In my opinion the answer to question No. 5 should be: ‘Yes, but not as a determining factor, and as having the very slightest weight if grounds for reasonableness of the refusal are proved to exist in answer to a prima fade case made by the plaintiff in Court.’
Geoghegan J.:
Mr. Justice Murnaghan permitted me to read the judgment which he has just read.
I agree with it, and there is nothing I can usefully add.
O’Byrne J.:
I have arrived at a different conclusion as to the answer which should be given to the first question submitted to us, and propose to state shortly the reasons which have induced me to arrive at that conclusion.
Under s. 3 of the Landlord and Tenant Act, 1931, where the buildings on any land are provided by the local authority under the Housing of the Working Classes (Ir.) Acts, 1890 to 1921, and such land is held by the local authority in fee simple, the said Act of 1931 shall not apply in respect of such land.
The building, with which this case [Kenny’s case] deals consists of a shop and residence known as No. 133 Galtymore Road, Crumlin. This building was erected
and stands upon land which was acquired by the local authority, viz., the defend ants in these proceedings, under the provisions of the Housing of the Working Classes Acts, 1890 to 1932, and this land is held by the local authority in fee simple. The question, then, as to whether the Act of 1931 applies depends entirely upon the question whether the said building was provided by the local authority under the said Acts and this is the first question submitted for our determination.
The land was acquired compulsorily under and for the purposes of the said Acts, and was demised by the defendants to one Wilde, the plaintiffs’ predecessor in title, by indenture of lease dated the 23rd November, 1940, for a term of 150 years from the 25th March, 1940, subject to the yearly rent of £28. The land, as so demised, was a vacant site and the lease contained a covenant, on the part of the lessee to erect thereon, within twelve months from the 21st August, 1940, a two-storey building consisting of a shop on the ground-floor and a residence on the upper floor. In purusance of that covenant the building with which we are concerned was erected by the lessee. Was this building provided by the local authority within the meaning of s. 3 of the Act of 1931?
Nothing turns upon the nature of the building or the purpose for which it is used. It was, admittedly, within the competence of the local authority to erect such a building under the powers conferred upon them by the said Acts and the case may be dealt with as though the building were erected for, and dedicated to the purpose of, housing members of the working classes. The question, thus, narrows itself down to the question whether the building was provided by the local authority. On this question I have arrived at a clear view.
Having acquired a piece of vacant land for the purposes of the said Acts, there were several ways in which the local authority might have proceeded with a view to having appropriate buildings erected thereon. They might have had the buildings erected by direct labour and, in such event, the buildings would clearly have been provided by the local authority. It is equally clear and conceded in the argument at the bar, that a similar result would have followed, if they had had the buildings erected by a building contractor for a money consideration. I can see no logical distinction between the latter case and the case which we are considering. In each case the local authority had secured the erection of the buildings for the purposes of the said Acts and the only distinction between the two cases is in the nature of the consideration given by the local authority. In the case of the building contractor true consideration is a money payment; in the other case it is a demise of the land, with the buildings to be erected thereon, for the term, and at the rent mentioned in the lease. This is valuable consideration, and was obviously considered by the lessee as ample consideration, for the erection of the house. In determining the question whether the building was provided by the local authority, I cannot see any real distinction between two cases, in one of which the consideration consists of money and in the other of money’s worth.
Is it to be held that a building is provided within the meaning of the section only
when the local authority pays for it in terms of money? This seems to me to be quite unwarranted and calculated to lead to absurd results. Suppose the erection of the building in this case cost £1,000. If the Corporation had paid that amount to Wilde (the original lessee) for erecting the building, then, in concessis, the building would have been provided by the corporation within the meaning of s. 3, though it might have been demised to Wilde the following day for the term, and at the rent mentioned in the lease in consideration of a fine of £1,000. The result in both cases would have been identical; but, in one case, it is admitted that the house would have been provided by the Corporation and, in the other case, it is contended that
it would not have been so provided. A construction which leads to such an absurd result is not to be recommended.
Take another case. Suppose the house were erected for the Corporation, not for a money consideration or a demise of the land upon which it was erected, but in consideration of the transfer or demise by the Corporation to the builder of another piece of land. Surely the building in such a case would be provided by the Corpo ration, and yet, what is the distinction between that case and the present?
The argument on behalf of the plaintiff in this case seems to me to have proceeded substantially on the basis that the word ‘provided’ in s. 3 of the Act of 1931 is synonomous with ‘erected,’ using the later word in a narrow sense, and unless some such meaning is attributed to it I fail to see how the first question can be answered in the negative. Yet it seems to me that the word has, and was deliberately intended to have, a wider signification. Under s. 8 of the Housing (Ir.) Act, 1919, the local authority may acquire existing houses, which may be made suitable as houses for the working ctasses. If it acquired such houses under and for the purposes of these Acts, it could ‘Scarcely be argued that they were not provided
under the said Acts; but the construction contended for would clearly exclude them. ·
When, as in this case, land is acquired by a local authority under the Housing Acts and buildings, dedicated to the purposes of the said Acts, are erected thereon in pursuance of a contract for valuable consideration entered into with that author ity I am of opinion that such buildings are provided by the local authority within the meaning of s. 3. The local authority has secured the erection of the buildings and has made them available for the purposes of the Housing Acts. This, in my view, is
all that is necessary to bring the buildings within the excluding provisions of s. 3 of the Act of 1931.
In my opinion the first question should. be answered in the affirmative and the other questions do not arise.
Black J:
The first question in these Cases is whether the defendants ‘provided’ the houses in question, within the meaning of that term ins. 3of the Landlord and Tenant Act, 1931. It is not disputed that if they had employed a builder to erect the houses at a price, contemporaneously leasing the sites and the future houses as from that date for a term of years, they would have ‘provided’ the houses as truly as if they had constructed them with their own hands. But, it is said that because they did not themselves employ the builder, but only bound another person by contract to employ him, they have not ‘provided’ the houses.
In both cases supposed, they would be, all along, owners of the reversion of both sites and houses, never parting with the seisin, and merely giving the lessees for years an interesse termini: Lewis v. Baker ([1905) 1 Ch. 46). In both cases they would have furnished the sites and bound another party by contract to build the houses or get them built. In both cases they would have given good consideration for the building of the houses, and none the less because, in one case the consider ation would be given directly to the actual builder, whether in a lump sum or in instalments over a period, while in the other case the consideration would be given to the building lessee, and would take the form of a lease of sites and houses together at a ground rent with fixity of tenure for an agreed term. Prima facie it does not seem to me that these differences in the method of bringing about the same result can make that result anything but the ‘provision’ of the houses in both cases alike.
When a thing is brought into existence, he who has made complete provision for its being so brought, and whereby it is brought, into existence, has provided it. At least, the lexicographers seem to define the word ‘provide’ in that sense.
So far, then, as the point depends solely on the ordinary usage of language, as I understand it, I see no justification for denying the claim of the Corporation to have provided these houses, seeing that they provided the sites and bound the respective plaintiffs’ predecessors by contract to erect them, giving them what they deemed adequate consideration for doing so.
I could, however, see great force in the contention, if indeed it were put forward, that the language of the section should not be given the full scope of its natural meaning, on the ground that the policy of the Act indicates that it was meant to have a more restricted meaning. This contention became the ratio decidendi of Collis v. Earl of Pembroke ([1934) I.R. 589), though the case turned on s. 46 with which we are not now concerned. The word in question there was ‘erect,’ which is a much narrower word than ‘provide.’ Yet, even there, FitzGibbon J. thought it necessary to give a reason for refusing to apply the maxim qui facit per alium facit per se. His reason was based on what he held to be the policy of the Act, and he showed that if the term ‘erected’ in s. 46 was not restricted to the action of the lessee who employed the actual builder ‘the whole policy of the Act could be frustrated’ by a process so easy that the Legislature must be supposed to have intended the term ‘erected’ to be so restricted. Just as FitzGibbon J. thought it necessary to give a reason for refusing to apply the maxim qui facit per alium facit per se in a case where the disputed word was ‘erected’, so I should have liked to hear a reason given in the present case for refusing to apply the same maxim where the word in question is the much wider term ‘provided.’ I have heard none. But, I think I ought to suggest and consider one myself – namely, the very reason given by FitzGibbon J. in Collis’s Case ([1934) I.R. 589) – the policy of the Act.
As ss. 56, 57 and 58 show, it was part of that policy to prevent lessors from insisting unreasonably on certain restrictive covenants. Plainly also, as shown bys. 3 it was part of that policy to exempt from those sections local authorities which provided houses under the Housing of the Working Classes Acts. Why should they be exempt from these salutary fetters upon unreasonableness? I have little doubt it was partly because it was felt that public bodies making provision for housing from altruistic motives might be trusted not to insist unreasonably on restrictive cove nants, and that legislative interference in their case might be dispensed with. I think the further reason for exempting them was that they should not be discouraged in the public work of providing housing by being exposed to lawsuits by their lessees professing to be aggrieved by such covenants. Obviously these reasons of policy would not be applicable save where the public authority continued to be the lessor of the houses affected. If they leased sites for building and their lessees made sub-leases of the houses they built, no public purpose could be served by exempting such lessees from the same restrictions on their conduct towards their sub-lessees as are imposed by the Act on all other private lessors. Can I then infer that the Legislature intended not to exempt from the Act such holders of building leases from local authorities, and that therefore the word ‘provided’ ins. 3, should have its full natural scope cut down so as not to exempt such persons? The argument based on the policy of the Act, which was decisive in Collis v. Earl of Pembroke ([1934) I.R. 589), seemed to me, at one stage, almost equally forcible in the present cases. But, on further reflection, I think it is not. In Collis’s Case ([1934) LR. 589), the wider meaning of the word ‘erected’ would have made easy, as FitzGibbon J.said, and therefore fairly certain, ‘the frustration of the whole policy of the Act.’ The Legislature could hardly have overlooked or intended that. But, in the present cases, giving the word ‘provided’ its full natural scope would not involve any such frustration. The worst that could follow from it would be to let people who got building leases from local authorities and build houses and sub-let them, escape from the provisions of the Act, notwithstanding that there appears no good reason why they should escape. The number of such persons may not be considerable, and the Legislature may have overlooked their exemption from the Act, or not thought it worth while making special provision against it, thinking only of its main purpose of exempting local authorities as lessors of houses which they had built or acquired under the Housing of the Working Classes Acts. Therefore, I do not think that any argument based on the policy of the Act would be strong enough in the present cases to justify our attributing to the Legislature an actual intention that the word ‘provided’ in s. 3 should have a narrower scope and meaning than, in our common usage of speech, I conceive it to possess. This conclusion would lead me to answer the first question submitted to us in the affirmative, thus rendering the other questions unnecessary. As, however, my view on the first question does not prevail, I must deal with the remair,iing questions also.
The second question in Patrick Rice’s case only differs from the second question in Nora Kenny’s Case in that it omits the word ‘absolutely’ before the word ‘prohibiting.’ This omission makes:no difference, because even if the agreement prohibits in some sense the alteration of the user, it does not prohibit it within the meaning of the section unless it absolutely prohibits it. Hence, the second and third questions in both cases all come down to the single query whether the agreement absolutely prohibits the alteration •of the user within the meaning of s. 57 of the Landlord and Tenant Act, 1931.
The Act has been in operation for fifteen years. Yet, the meaning of the phrase ‘absolutely prohibiting the alteration of the qser’ seems never before to have been judicially determined. This is strange; first, because of its widespread practical importance, since it may make a great difference to many landlords and tenants throughout the country; and secondly, because of its highly controversial character. Its doubtfulness was shown by the fact of Mr. Justice Davitt having submitted it to this Court, and also, I often heard it recognized as problematical, and debated out of Court, when I was at the bar. It is, therefore, no question for a mere dogmatic pronouncement; but in my view demands a careful examination of the obvious objections which obstruct each of the alternative interpretations to which it is open. We have two excellent text-books on this Act of 1931. That which bears the name of Mr. Justice Dixon, as he now is, replete as it is with aids to other problems does not happen to touch this one. But, Messrs. Moore and Odell, in their work, have tried to reason it out. Their conclusion is that ‘a covenant which merely restrained the lessee from carrying on as shop, or from carrying on noisome trades, would not come within the words of the section.’ If that is right, no agreement which does not prohibit all and every alteration of the user is within that section, and the second and third questions must be answered: ‘No.’ In my judgment, if one takes the words of s. 57 alone, both language and logic justify this conclusion of the learned authors quoted. A covenant expressed absolutely to prohibit ‘the alteration of the user’ is a quite different covenant from one that is expressed absolutely to prohibit merely ‘a particular alteration of the user,’ and vice-versa. The former includes the latter; but this, so far from making them both the same covenant, renders it impossible for them to be anything but essentially different covenants. Hence, when in s. 57 the Legislature clearly specified one of these two covenants as that with which the section was conversant, I infer, prima facie, that it did not mean the other, which would be an essentially different covenant from that which it meticu lously describes.
Ifa tenant agreed with his landlord in express terms that ‘the alteration of the
user’ of the premises should be ‘absolutely prohibited,’ nobody could doubt that the effect would be to prohibit all and every alteration of the user. On the other hand, if the parties agreed in express terms merely that ‘a particular alteration of the user’ should be absolutely prohibited, I imagine that no solicitor for the tenant would advise his client that this agreement ‘absolutely prohibited the alteration of the user’. If he did so advise, and the client suffered by assuming in consequence that he could not make any change of user at all, and later on discovered the true position, I think his legal adviser might find himself in an awkward predicament. An absolute prohibition of a particular change of user is, in my view, a qualified and conditional prohibition – or, in other words, a mere restriction – of ‘the alteration of the user.’ I think the dictionaries are right when they all give the primary meaning of ‘absolute’ as ‘unconditional,’ and also when, like the Oxford Dictionary, they describe a ‘condition’ as ‘a thing upon the fulfilment of which depends that of another.’ The ‘thing’ in question – that is, the condition- may be the failure to obtain one’s landlord’s consent. But it may equally well be the failure to obtain somebody else’s consent, or it may equally well be the doing, refraining from doing, or happening of something which has nothing to do with the obtaining of anybody’s consent. So if a tenant is prohibited from changing the user of his premises, but is only so prohibited if – or, in other words, on condition tha-t the change proposed is of a particular kind of change, then surely the prohibition of the change of the user is clearly conditional. The making of the one particular kind of change in question is ‘the thing upon the fulfilment of which depends that of another,’ that other being the coming into operation of the prohibition. I find quite incomprehensible the idea that a prohibition which permits every one of the countless possible alterations of user save one exceptional kind of alteration can be said to be an absolute prohibition of the alteration of the user. I find equally incomprehensible the idea that the only kind of condition contemplated by the section as making the prohibition conditional is a condition that the landlord’s consent shall not have been obtained. Why all other possible and well-recognised conditions should be treated as not being conditions at all for the purposes of the section I cannot even begin to understand. The only explanation I have heard of this is thats. 57, sub-s. 1, contrasts a covenant prohibiting the alteration of user without the landlord’s consent with a covenant prohibiting alteration of user.
Naturally, the condition about the landlord’s consent is the only condition the section mentions, and for the obvious reason that this is the only conditions which it causes to be implied. That is why it has to mention it. It does not mention any other conditions, simply because there would be no point in doing so, since it does not cause any of them to be implied. But this natural omission to mention any other conditions since there is no reason to mention them in no way indicated to me that no other conditions are contemplated as conditions by being dependent on which the prohibition would be rendered conditional, and, therefore, not absolute.
In the result my first view of s. 57 was that there could not be an absolute prohibition of the alteration of the user unless all and every change of user was unconditionally prohibited, for I thought, and still think, that that is the kind of prohibition that the language, used in its natural sense, connotes. Neverthelss on close examination of the analagous s. 56, I think I can find a reason which entirely changes the position. Sect. 56, introduces a certain implied condition into every lease which contains an agreement ‘absolutely prohibiting or restricting the alien ation, either generally or in any particular manner ‘ Now, were it not for these words ‘either generally or in any particular manner’ ins. 56, I should agree with the view taken in the text-book of Messrs. Moore and Odell in regard to s. 57. In substance I think this view is that the word ‘restricting’ in s. 56, used in con tradistinction from the phrase ‘absolutely prohibiting’, shows, all the more clearly, that prohibition of a particular method of doing the thing in question would bea mere restriction and not an absolute prohibition. By analogy the significant absence of the word ‘restricting’ from s. 57 would emphasize the natural meaning of the phrase ‘absolutely prohibiting’ as excluding any prohibition of change of user conditional on its being a change of a particular- kind. But the addition of the words
. ‘either generally or in any particular manner’ in s. 56 reverses the whole of that concusion. I read s. 56, sub-s. 1 as contemplating that a covenant, condition or agreement may: 1, absolutely prohibit alienation generally; 2, absolutely prohibit it in any particular manner; 3, restrict alienation generally; or 4, restrict alienation in any particular manner. It is easy to understand 1 and 4. But 2 shows that for the purposes of the section the Legislature contemplated that a covenant may abso lutely prohibit alienation, though it only prohibits it when effected in a particular manner, provided of course that the prohibition does not depend on any other condition. This is an indication that,the the phrase ‘absolutely prohibiting’ is used in
a special sense. Now ‘it is a sound rule of construction to give the same meaning to the same words occurring in different parts of an Act of Parliament’: per Cleasby B. in Courtauld v. Legh (L.R. 4 Ex. 126, at p. 130), unless there is strong reason for doing otherwise: In re National Savings Bank Association (L.R. 1 Ch. 547, at p. 550) and Reg. v. The Poor Law Commissioners, in the Matter of the Ho/born Union (6 A.& E. 56. at p. 68). So, by analogy, as “absolutely prohibiting alienation” ins. 56 includes, for the reason stated, an unconditional prohibition of alienation in one particular manner only, likewise it may be inferred that “absolutely prohibiting the alteration of the user’ in s. 57 may be intended to include unconditional prohibition of one or more kinds of alteration only. In other words s. 56, when the context is considered, seems to show that the phrase ‘absolutely prohibitng,’ as applied to alienation, is used, not in its full and natural sense, but in the special sense just indicated. By analogy and the rule of construction mentioned, the same words ‘absolutely prohibiting’ may be given the same special meaning when applied in s. 57 to alteration of user. This inference drawn from the wording of s. 56, and this alone, enables me to agree that the words ‘absolutely prohibiting’ in s. 57 may be
interpreted in the special sense indicated. Were it not for s. 56, for my part I could not do so.
Having found, as I think, a reason to justify that view, one can easily see another that fortifies it, though it would not be a justification in itself. It is that if one had to hold that an agreement absolutely prohibiting alteration of user is confined to an agreement which prohibits all and every alteration of user, it would open the door toa device which might easily render the whole of s. 57 quite valueless. This device would be to qualify every covenant against alteration of user by some condition which, theoretically, would prevent it from being absolute, but which actually would never be likely to arise. It follows that I should answer the combined second and third questions in both cases in the affirmative.
As to the fourth question, I should answer it: ‘No.’ The fact that the defendants gave no reason for their refusal, at the time, has no effect on the onus of proof. If the onus of proof is shifted at all it can only be, as in most other cases, by the fact of the plaintiff’s making a prima facie case, which in this instance would be a prima facie case of unreasonableness on the part of the defendants. It is immaterial to the issue whether the defendants at the time of their refusal gave a good reason for it or even whether they gave any reason at all. All that is material is, whether, in the opinion of the learned judge at the hearing, a reason for the defendants’ refusal exists and is sufficient to make their refusal reasonable.
The fifth question seems to suggest that the grounds of refusal which the defend ants had or put forward at the time is necessarily material; whereas the material grounds are those which in fact exist. In my view the defendants’ grounds of refusal at the time can only be material if no better grounds than those in fact exist at the time of the hearing. Consideration of the plaintiff’s special circumstances may be material in determining whether the defendants’ refusal is reasonable or not; but it may also be quite immaterial to that determination. If, for instance, the plaintiff proposed to use the premises for an illegal purpose, or possibly, if he sought to open a shop in a locality like Fitzwilliam Square, his special circumstances would be irrelevant; but, on the other hand, if his proposed change of user seemed to the Court reasonable in itself, but the defendants’ objections also seemed cogent in themselves, then the material question would be whether in the opinion of the Court the reasonable desire of the plaintiff outweighed, or was outweighed by, the reasonable objections of the defendants.
It is for the learned judge to form his own opinion from the character of the locality and such other circumstances as may exist whether the determination not to consent to the user of the premises for the sale of intoxicating liquor is reasonable in itself, even allowing for any special circumstances which may be established by the plaintiff.
The Cases were accordingly remitted to Davitt J. for decision.
Lyle v Smith
LYLE V. SMITH
[1909) 2 I.R. 58; 43 I.L.T.R. 255 (King’s Bench Division)
Lord O’Brien L.C.J.:
This case brings up again a controversy which has existed for some centuries in our law, namely when, does a covenant run with the land? Spencer’s Case (1 Sm.
L.C. (11th ed.), p. 55), however reminiscent of an earlier period, most certainly does not renew our youth. The learning connected with it tells us of those subtle distinctions which in other days delighted the sages of the law, but which, perhaps, did not reflect much credit on the law itself. The facts which give rise to the controversy before us are set forth in the case stated for our determination by my brother Wright. The case stated has been so frequently read that it is not requisite to read it again. The lease to which it refers, and the lessee’s interest in which is now vested in the defendant as assignee, contains the covenant upon which the controversy depends. It runs as follows: [His Lordship read the covenant.] The sea-wall which is referred to is not on any part of the demised premises, but is essential to the protection and preservation of the demised premises. Mr. Justice Wright, who tried the case, states: – ‘It was further proved that a storm occurred on 26th November, 1905, causing the breaches in the sea-wall shown (coloured pink) at A and B on the plan. The breach at A was so large as to endanger the roadway at that point. These breaches were repaired by the plaintiff at a cost of £242. The whole of the wall and the wall as a whole is necessary for the protection of the coast. If a breach remained unrepaired, the sea would scour behind the remainder, and eventually the entire wall would be swept away. Ultimately the sea would undermine and destroy the roadway and villas beyond.’ It is further found that the defendant’s proportion, if she is bound to contribute, would be £20 6s. 7d.
The question for our determination is, Is the defendant in fact bound to contri bute towards the repair and maintenance of the wall? No question has been argued as to amount, if she is bound to contribute at all. I am of opinion that the defendant, who is assignee of the lessee, is bound to contribute on two grounds: 1st, that the obligation to contribute is not a mere collateral agreement, that it is a covenant which runs with the land; 2nd, on the point secondly argued, that if the agreement or obligation is not one that can be held, strictly speaking, to run with the land, it is at least a covenant incident to and relating to the tenancy, to the subject-matter demised, and being so binds the assignee under the provisions of the 12th section of the Landlord and Tenant (Ireland) Act of 1860.
Firstly, then, does the covenant in question run with the land, and bind an assignee? The word ‘assigns’ is used in the covenant, and what is provided for is for the benefit, protection, and indeed I might say for the preservation of the subject matter demised during the continuance of the tenancy. Now it is well settled that a covenant to do something on part of:the land – the subject-matter demised – runs with the land, though assigns are not specifically named, and a covenant to do something which is intended to become parcel of the land uns with the land if the word ‘assigns’ is used. But the cases have gone further. It has been held that though the thing to be done is not upon parcel, nor intended to become parcel, of the subject-matter demised, yet if the thing to be done is clearly for the benefit, support, and maintenance of the subject-matter demised, the obligation to do it runs with the land: see the case of Easterby v. Sampson (6 Bing. 644). There Alexander, C.B., is reported to have said (p. 652): ‘Spencer’s Case (1 Sm. L.C. (11th ed.), p. 55) lays down the rule, that if the lessee covenant for him and his assigns to do anything on the land demised, it will bind the assignee, though the covenant should extend to a thing to be. newly made. And in The Mayor of Congleton v. Pattison (10 East, 130) Lord Ellenborough says: “A covenant in which the assignee is specifically named, though it were for a thing not in esse at the time, yet being specifically named, it would bind him if it affected the nature, quality, or value of the thing demised, independently of collateral circumstances; or if it affected the mode of enjoying it.” That is the rule to be extracted from Spencer’s Case (1 Sm. L.C. (11th ed.), p. 56) and from all which have followed it.’ And the Chief Baron added later in his judgment that the covenant to build a smelting mill, though it was not to be built on the land demised, yet ran with the land because it was plainly connected with the mines which were demised. See also Vyvyan v. Arthur (1 V. & C. 410), and Athol v. Midland Great Western Railway (I.R. 3 C.L. 333).
A covenant to repair a sea-wall which so closely affected the quality, value, identity, and even the existence of the subject-matter demised would plainly run with the land; but the question here which was so much pressed by Mr. Harrison in his able argument is more difficult – much more difficult – it is this: Is the obli gation created by the deed to contribute a proportionate sum an obligation which runs with the land? It was contemplated that the lessor’s was to be the hand that was to do the entire work – the whole work necessary for the repair of the sea-wall throughout its entire length. Does the obligation on the part of the lessee to pay to the lessor a proportionate sum of this entire liability amount to an obligation running wth the land? Certainly there is no case precisely in point; but I think that, having regard to the object contemplated and provided for, the obligation comes within the class of obligations which run with land. It most intimately touches and concerns the land. A sea-wall is obviously necessary for the protection, indeed for the preservation, of the subject-matter demised. It is manifestly for the interest of the lessee or assignee – for the interest of the person for the time being in possession as lessee or assignee – that the sea-wall should be repaired; and though the instrument of demise contemplates that, in the first instance at least, the hand to make the repair is the hand of the lessor, yet he works for the common benefit of himself and the lessee in a matter that touches and concerns the land, and he may be regarded as an agent pro tanto for the lessee, that is, an agent to expend in repair, and to do so much repair as may be covered by a contributive amount, ascertainable by the prescribed method and proportion. I think the obligation to pay the prescribed amount was, in its substance and essence, an obligation that ran with the land.
Before I leave this branch of the argument I should, I think, refer to the case of
Dewarv. Goodman ([1908] 1 K.B. 94), which was pressed upon our attention with so much insistence by counsel for the defendant. That case is, in my judgment, plainly distinguishable from the present. There the thing covenanted to be done, namely, to keep in repair certain houses which were not the subject of the sub demise, had no reference to what was the subject of the sub-demise. It did not touch the subject-matter of the sub-demise, nor did it support or maintain it in any way. It had no connection whatever with the corpus of the subject-matter sub demised, or with the mode of enjoyment. There lies the distinction between the case of Dewar v. Goodman ([1907] 1 K.B. 612; [1908] 1 K.B. 94) and Easterby v. Sampson (6 Bing. 644). No doubt the non-repair of the houses other than those sub-demised might lead to forfeiture of the estate of the lessee in all the houses, but this would not make the covenant in the under-lease run with the land. This is very clearly put in the judgments of Mr. Justice Jelf and Lord Justice Buckley. Mr. Justice Jelf is reported to have said ([1907] 1 K.B. at p. 622) – ‘On principle Mr. Copping argued on behalf of the plaintiff that the covenant in question for perform ance of the covenants of the head lease does pro tanto touch or concern the thing demised in that, if performed, it secures the possession of it by preventing eviction on that ground by the superior landlord, and if not performed it forfeits the under-lease. I was at first much struck with this argument, and if the matter were res integra I should be inclined to adopt it; but an examination of the cases cited by Mr. Atherley-Jones for the defendant seems to point to a stricter interpretation of the rule, and to require that, in order to run with the land and the reversion, a covenant must directly, and not indirectly or collaterally, touch the land demised: see, for instance, Thomas v. Hayward (L.R. 4 Ex. 311), Mayor of Congleton v. Pattison (10 East, 130, at p. 135), where Lord Ellenborough says a covenant is assignable “if it affects the nature, quality, or value of the thing demised, indepen dently of collateral circumstances, or if it affects the mode of enjoyment.”‘ Lord Justice Buckley is reported to have said – ‘The contention for the plaintiff may, I think, be summarized as follows: A covenant to do an act, not in respect of the demised premises, but which will protect from forfeiture the estate of the lessee in the demised premises, is a covenant which runs with the land.’ He added – ‘If that proposition is true, it is wholly new. It may, nevertheless, be true, but I am not aware of any authority in support of it.’ He then examined the cases, and rejected the proposition. It is plain, I think, that the case of Dewar v. Goodman ([1907] 1
K.B. 91) is not an authority against the plaintiff.
But now I come to the 12th section of the Landlord and Tenant Act of 1860, and here arises a question of very great general importance. It is interesting from a legal point of view, and, as I said, is of great general importance. I desire to preface my consideration of the actual language, the ipsissima verba of the section, by some observations made by Lord Hatherley and by Lord Justice Holmes. Lord Hatherley is reported to have said, in giving judgment in Liddy v. Kennedy (L.R. 5 H.L. 134, at p. 143), a case in which there was a provision to resume possession of premises, but in which a severance of the reversion had taken place – ‘Now, as regards a condition of this kind, very many authorities have been cited to satisfy us that, after severance of the reversion, after this change in the interest of James Kennedy, great difficulty would be experienced, as matters stood after former decisions, in holding that this lease could be terminated, under any circumstances, by the effect of the proviso. But what has happened in Ireland has been this, that, although it may be held in Ireland that the statute of Hen. 8 (to which the statute of Car. 1 in Ireland was analogous), dealing with the interest of assignees of reversions, is not applicable to a case like this, where the reversion has been severed, and therefore does not enable persons, where the reversion has been parted with, to avail themselves of the previous construction of this proviso, yet the statute for Ireland of the 23 & 24 Viet. c. 154, entirely remedied that defect. It appears to me that this statute has been framed for the express purpose of removing some of these technical difficulties which stood in the way of justice, and which, though devised originally with logical regard to onsequences, have been found in practice to involve far more frequently the failure of justice than to secure any beneficial result to the parties.’ To the same effect’is the language of Lord Chelmsford. He says (p. 149): – ‘But then, supposing that·under the Common Law this clause in the lease might be subject to the objection that the reversion, or a portion of the reversion, was parted with, and that the power or condition, or whatever it may be called, would be subject to the objection, that the power was entirely gone, we have in this case the Landlord and Tenant Act in Ireland, the 23 & 24 Viet. c. 154, which appears to me, whatever may have been the Common Law on the subject, to put the question upon an entirely different footing. The clauses of that Act to which attention has been directed appear to me to be perfectly clear on the subject. It seems to have been the intention of the Legislature that parties in the position of James and Victor Kennedy should be entitled to use the power which was conferred upon them for the purpose for which it was intended. Now what is the interpret ation clause with regard to the word “landlord.” It is to include the person for the time being entitled in possession to the estate or interest of the original landlord under any lease or other contract of tenancy, whether the interest of such landlord shall have been acquired by lawful assignment, devise, bequest, or operation of law, and whether he has a reversion or not. It was said by Mr. M’Mahon that this applies only to the case of the assignee of the original landlord, and not to the original landlord himself. It would be a very extraordinary state of things that the landlord by parting with a portion of an interest should give to the assignee a right, and by the same act should deprive himself of the right which he previously possessed in respect of the interest which he retains. But it appears to me, then, that the words, “entitled to the estate or interest of the original landlord,” may very well apply to the case of James Kennedy, because James Kennedy is not in possession of the entire estate and interest of the original landlord. Thus the 12th section provides that “every landlord of any lands holden under any lease or other contract of tenancy shall have the same action and remedy against the tenant and the assignee of his estate or interest, or their respective heirs, executors, or administrators, in respect of the agreements contained or implied in such lease or contract as the original landlord might have had against the original tenant or his heir or personal representative respectively.”‘
In Re M’Nau/’s Estate ([1902) 1 I.R. 114), Holmes, L.J., when dealing with the rule of construction of statutes, is reported to have said (p. 138): ‘In Riordan v. M’Namara (30 L.R. Ir. 495) I made some observations on this subject, which further experience has tended to confirm. We of a later generation, who have seen rampart on rai;npart of legal feudalism disappear before the steady inroad of legislative innovation, can hardly understand the difficulty which our predecessors had in realizing a fee-simple estate moulded and modified by statute. There is, however, one passage in the judgment of Barry, J., in Morris v. Morris (I.R. 6 C.L. 73) which sets forth the true nature of the estate taken by a grantee under the Act of 1849. “Whatever be the effect,” he says, “of the fee-farm grant, it can only have such operation as is conferred on it by the statute, and that operation is to be ascertained from the language of the Legislature construed according to the well known rule, that every clause and every word must obtain its full and ordinary force and meaning, unless such construction would lead to spme absurdity or some repugnance or inconsistency with the other provisions of the enactment.”‘
I may also refer to a passage from the judgment of Jessel, M.R., in Re Willey (23 Ch. D. at p. 127), cited in the argument in Re M’Naul’s Estate ([1902) 1 I.R. 114): ‘I never allow my construction of a plain enactment to be biassed in the slightest degree by any number of judicial decisions or dicta as to its meaning, when those decisions or dicta are not actually binding upon me. I read the Act for myself. If I think it clear, I express my opinion about its meaning, as I consider I am bound to do. Of course if other Judges have expressed different views as to the construction, and their decisions are binding on this Court, this Court has simply to bow and submit, whatever its own opinion may be. But when there is no such binding decision, in my view a Judge ought not to allow himself to be biassed in the construction of a plain Act of Parliament by any number of dicta or decisions which are not binding on him.’
Now then, applying these cases to the matter in hand, in the first place, there is no case which decides the question which presents itself on the 12th section of Deasy’s Act. I omit for the present the valuable observations of Mr. Justice Andrews in the case of Burrowes v. Delany (24 L.R. Ir. 503). But taking, as I am told to take, the ipsissima verba of the section, is there anything to prevent my giving to them their ordinary meaning? Nothing that I can see. Having regard to the definition of the word ‘landlord’, in the Act of Parliament, the words of the 12th section fit the case. It is plain that the words ‘during the continuance of the tenancy,’ which occur in the lease, point to a contractual matter – to use Mr. Justice Andrews’ language, incident to the subject-matter of the tenancy. The Landlord and Tenant Act of 1860 has reference to ‘land,’ and contracts in reference to land, and the contract under consideration is calculated to affect the subject-matter of demise. The relation of landlord and tenant does not, as it did, rest upon tenure; it now rests upon privity of contract, and if the relation of landlord and tenant rests upon privity of contract, why should not an assignee be bound by an instrument in which the word ‘assigns’ is used, when he takes under that instrument, and must be presumed to have known its contents? Is the landlord to do all the work which may be really necessary for the preservation of the subject-matter demised? and is the assignee, though specifically named, and enjoying the benefit that has accrued to the lands he occupies by work done in his time, to bear no part of the burthen? The defendant has entered on the subject-matter of the tenancy under an instrument of contract which uses the word ‘assigns’, and now endeavours to renounce the contractual obligations which relate to the subject-matter of the contract. This, in my opinion, he cannot do.
The sea-wall was for the common benfit of the landlord and various lessees; it was essential to preserve the property demised, to enable the lessee to perform his covenants as to that property, and to secure the road constituting the approach; it could only be maintained by entrusting the work to the landlord, as the entire length of sea-wall was necessary, and the maintenance could not be left to separate action of lessees dealing with fractions of the structure. Part of th consideration of the lease was the covenant to contribute, and the rent was thereby made less than it otherwise would have been. In these circumstances it seems startling to the ordin ary intelligence that though the lessee should be bound, the assignee should not be.
Defendant’s counsel, relying on Spencer’s Case (1 Sm. L.C. (11th ed.), p. 55), contend – (1) That even if the covenant obliged the lessee to do the work himself, his assignee would have been under no such responsibility; (2) that even if he would have been, the covenant to contribute is only a collateral covenant to indemnify, not running with the land. For the plaintiff it is replied that – (1) the contribution was in substance part of the rent; (2) that the covenant ran with the
land; (3) that even if it did not, Deasy’s Act, sects. 12 and 13, transfers the obligation to the defendant. ,
The service of cleaning a parish ch’Urch, ringing the church bell, keeping a grindstone for the use of a parish: Doe v. Benham (7 Q.B. 976), or labour for the landlord, may be rent, and the variable character of service or payment does not affect the character of rent: Lloyd v.. Keys ([1901] 2 I.R. at p. 421). By a trifling change in drafting the present lease contribution could have been made rent proper; it is in substance a payment by which the rent is reduced. This exhibits the extreme technicality of defendant’s argument. It was not, however, introduced into the reddendum as rent, and was not I think, rent. The questions for consideration are, therefore, two. Did the covenant run with the land? If technically it did not do so, did Deasy’s Act make the assignee liable?
1. In England, where the maintenance of sea-walls is the subject of express legislation, covenants like the present must often occur: see Newport Union v. Stead ([1907] 2 K.B. 460) (since reversed by the house of Lords), where, at p. 467, the form of the statute is given. There is no analogous Irish legislation. It was suggested for the plaintiff that the facts here throw on the lessor an implied duty to maintain the wall, and that on his failure to do so, the lessees could have entered to execute the necessary repair, as stated by Lord Romilly in Morlandv. Cook (L.R.6 Eq. at p. 261). I have not felt it necessary to decide this point, which has not been sufficiently argued; and I will deal with the case on the basis that the lessor was not legally obliged to maintain the wall, though of course in his own interest he would necessarily do so, and it was assumed he would. I have not found any case quite like the present. Vyvyan v. Arthur (l B. & C. 410) was a case of service like rent. Jourdain v. Wilson (4 B. & Als. 266) and Athol v. Midland Great Western Railway (I.R. 3 C.L. 333) were cases of quasi-easements attached to the demised premises. Morris v. Kennedy ([1896] 2 I.R. 247) is of the same type. And in Sampson v. Easterby (9 B. & C. 505), where the question was as to the benefit of the covenant running with the reversion, the smelting mill was part of the mining equipment which the lessee was to enjoy in specie. In Vernon v. Smith (5 B. & Aid. 1) the insurance money was to be spent on the premises. The only assistance derived from the cases is the principle they lay down. A covenant runs with land when it relates to the support and maintenance of the premises: Bally v. Wells (Wilmot’s Notes, p. 344), cited in Vernon v. Smith (5 B. & Aid. 1); or which affects the nature, quality, or value of the thing demised, independently of collateral circumstances; or which affects the mode of using it: Mayor of Congleton v. Pattison (10 East, at p. 135); or which affects the land itself during the term; or which, per se, and not merely from collateral circumstances, affects the value of the land at the end of the term; same case at p. 138. The present covenant appears to fall within the principle. The benefit of the covenant would seem clearly to run with reversion, so that the landlord’s grantee could sue the lessee on it: Rogers v. Hosegood ([1900] 2 Ch. 388), the reasoning in which is important. Must not the burthen equally so run? None of the cases cited for the defendant is in point. They all relate to covenants quite unlike the present. Dewar’s Case ([1908] 1 K.B. 94) is plainly distinguishable, as there was a limited covenant for quiet enjoyment, and the covenant related to premises not demised. If the covenant for quiet enjoyment had protected the sub-lessee from the sub-lessor’s default in performing the covenants in his own lease, that covenant would have certainly run with the demise. The covenant held not to pass had very much the same object. It is unnecessary to criticize the decision, as it is not in point here. In the present case, would not a covenant by the lessor to maintain the sea-wall have run with the land, both as to burthen and benefit? And would the result be different if the covenant was made conditional on the lessee’s making contribution to the cost?
Mr. Harrison relies on several special grounds which make (he contends) the covenant collateral: the covenant only arises if the lessor expends money on repair, which he is not bound to do; the wall is at some distance from the leasehold premises; and the money payment is only an indemnity. No doubt the obligation only purports to attach if the repair has been necessary, and has been carried out; but the plain object was to secure the maintenance of the wall, which was assumed to be necessary for the common protection. The fact that a small space intervened between the holding and the wall – part of such space consisting of the road approach – cannot affect the real function of the wall as a shield to the premises. It is not necessary that the wall should be at the defendant’s actual boundary; all the parts behind the wall in peril of sea erosion were benefited by it.
As to the covenant being for money contribution and not for physical repair, it is manifest that the wall as an entire thing must be maintained by one person, the landlord; and the only useful obligation that could be imposed on the lessees would be to assist financially. The recital in the statute mentioned in the Newport Union Case ([1907] 2 K.B. at p. 467) and Morland v. Cook (L.R. 6 Eq. 252) illustrates this mode of aid. The money represents the value of the share of labour.
A further objection was that the benefit of the covenant could not run with the lessor’s estate if the reversion was severed. The same difficulty would have arisen in Vyvyan’s Case (1 B. & C. at 410) (as pointed out in Doe v. Reid (10 B. & C. at p. 857), in Sampson’s Case (9 B. & C. 505), and in Coker v. Guy (2 B. & P. 565). When there is such division, the problem often is not easy to solve. See, for example, White’s Case ([1897] 1 Ch. 767), Clegg v. Hands (44 Ch. D. 503), The Manchester Brewery Co. v. Coombs ([1901] 2 Ch. 608). As there has been hitherto no such severance, I decline to pronounce any speculative opinion of future contingencies.
2. Assuming (contrary to my opinion) that in strictness the covenant would not have run with the land, does Deasy’s Act, section 12, make the assignee liable? The section consists of two parts. The landlord has the same action and remedy against the assignee in respect of the agreements contained or implied in the lease or contract as the original landlord might have had against the original tenant; and the heir or representative of such landlord on whom his estate or interest under any such lease or contract devolves or should have devolved has the like action and remedy against the tenant and assignee for any damage done to the estate by breach of agreement in the landlord’s lifetime as such landlord himself might have had. I agree with Mr. Harrison that the statute of 11 Anne, c. 2 s. 4 (Irish), gives no assistance; its object was in Ireland, by transferring privity of contract, to get rid of the absurd anomaly, discussed in the notes to Mostyn v. Fabrigas (l Sm. L.C. (11th ed.), p. 591), that a lessor’s action against an assignee, not being within the statute of Charles 1, and resting therefore on privity of estate, was local and not transitory. The Act was an amendment of the Act of Charles 1, and should receive the construction impressed on that enactment. .
Putting the statute of Anne aside as irrelevant, I take up Deasy’s Act. Though not in strictness a code, it covers for future lettings, the entire relation of landlord and tenant, abolishing old real property principles, which it replaces by the law of contract. The necessity of a reversion disappears, and transmission of burthen and benefit under the contract no longer depends on the existence of a deed under seal. The assignee is put in the original tenant’s place, whether assigns are named in the covenant or not. If the contract of tenancy is assigned, the lessee remains liable until discharged under sect. 16, meanwhile enjoying a right of indemnity against the assignee. Section 16 assumes that when the landlord gives the prescribed consent, the assignee is subjected to all the lessee’s liabilities. The intention of the legislation is illustrated by such cases as Bickford v. Parsons (5 C.B. 920); Buckworth v. Simpson (1 C.M. & R. 834) and C(Jrnish v. Stubbs (L.R. 5 C.P. at p. 339). In a demise not under seal, the assignee could only be bound by being substituted under
a new tenancy on the old terms: Elliott v. Johnson (L.R. 2 Q.B. at p. 127). By making the tenancy pass with its liabilities the statute obtained the same result. The statute was intended to put the law of landlord and tenant in Ireland on a modern, simple, and intelligible basis, getting rid of feudal technical rules; and it falls within the observations of Holmes, L.J. in M’Naul’s Case ([1902] 1 I.R. at p. 138). The express language of sections 12 and 13 cannot be restricted or altered by forcing on it Spencer’s Case (1 Sm. L.C. (11th ed.), p. 55) applicable to the law of covenants at common law, which was so precious in the eyes of legal schoolmen that they could hardly conceive a statute disregarding it. We must construe the enactment as it stands: Vagliano’s Case ([1891] A.C. at p, 145). It introduced a wholly new and revolutionary principle, substituting contract for ancient real property law. The effect of sections 12 and 13 has attracted only little attention since 1860, and the authorities on the subject are few. In La Touche’s Furlong, at p. 558, and in Nolan & Kane (3rd ed.), pp. 21 and 22, the view is taken that collateral covenants are transferred. In Athol’s Case (I.R. 3 C.L. 333) and in Morris v. Kennedy ([1896] 2 LR. 247) the covenants were held to pass; but the application of the statute was not discussed or considered. The only direct reported authority is the judgment of Andrews, J., in Burrowes v. Delaney (24 L.R.Ir. at p. 517), where he held that covenants ‘incident to the tenancy,’ though not strictly running with the land, came within the operation of section 13. In a late case (unreported) in this Divison, in an action brought by a lessor under a provision in the lease appropriating it to the last year’s rent of the term; the assignee of the lease obtained a fair rent order under the Act of 1887, reducing the rent; he was held by the Court, presided over by Palles, C.B., on new trial motion, to be entitled to use the money so lodged with the landlord in satisfaction of the rent sued for in the action, though, if the lease had not been determined by the Act of 1887, the time of appropriation had not arrived.
I am not aware whether Deasy’s Act was relied on. At the trial of this case before me no question was raised on the ground of want of contractual privity. The tendency of the speeches in Liddy v. Kennedy (L.R. 5 H.L. 134) also favours the wide construction of the statute.
The assignee is made subject to the same action and remedy as the original lessee, and so far as regards terms applicable to the contract of demise as a continuing obligation intended to bind the tenant for the time being, the assignee, who takes the benefit, cannot, as against the landlord, disclaim the burthen. If the intention expressed or implied in the contract is to attach to the tenancy, as part of the demise, obligations relating to the land which are to operate during the term against everyone holding under the contract, the assignee is made liable. On the importance of intention Rogers v. Hosegood ([1900] 2 Ch. 388) contains some interesting reasoning. It relates to benefit of covenants passing on a sale in fee, and does not directly bear on a demise, or contract liability of the kind created by Deasy’s Act.
There may be terms depending on personal considerations and not capable of vicarious performance: Tolhurst’s Case ([1903] A.C. at p. 417), which might not come within sections 12 and 13; and collateral agreements might be conceived so disconnected with the land and demise that they might not pass to the assignee. Such terms would be construed as not intended – prima facie, at least – to apply or attach to the tenancy proper. It would be undesirable to attempt an exhaustive definition as to covenants which are within or outside the statute. Such cases as Raymond v. Fitch (5 Tyr. 985), Doughty v. Bowman (11 Q.B. 444), Dewar’s Case ([1908] 1 K.B. 94) seem plainly within it. I confine myself to the question of principle. If the covenant here would have been collateral before 1860, the statute now makes it bind the assignee; it concerns the very existence of the subject of demise; it is expressly part of the consideration of the letting; and was intended to impose liability on all owners of the tenancy during the entire duration of the term. On both grounds, the nature of the covenant and the effect of the statute, I concur in the original conclusion of my brother Wright, in favour of the plaintiff.
Madden J.:
This is an action by a lessor against the assignee of a lease for 999 years upon a covenant in the lease. Two questions arise in the case: one of these depends upon the construction and effect of this particular covenant; and the other is of great general importance. The plaintiff contends, first, that the covenant upon which the action is founded is one which runs with the land, within the meaning of the second resolution in Spencer’s Case (1 Sm. L.C. (11th ed.), p. 55), and the subsequent authorities; and, secondly, that if he should fail to bring the case within these authorities, the words of the 12th section of the Landlord and Tenant Act of 1860 are sufficiently wide to include certain covenants between lessor and lessee which would be regarded as collateral under the decisions upon the Act of Hen. 8, and the corresponding Irish statute of Charles 1. This section of the Act of 1860 now represents for Ireland the Act of 32 Hen. 8, c. 34, upon which Spencer’s Case (1 Sm. L.C. (11th ed.), p. 55) was decided. It is undoubtedly, in certain respects, wider in its application than the Irish statutes which it superseded and repealed (10 Car. 1, s.2, c. 4, and 11 Anne, c. 2). It extends to contracts of tenancy not under seal, and it is part of an enactment by which privity of contract is substituted for privity of estate, and by which the principles of tenure are no longer applicable to the relation of landlord and tenant. Thus it had the effect of doing away with much of the technicalities which led to a failure of justice under the older Acts. Whether it has the further effect of transferring the burden and benefit of a class of covenants which must be regarded as collateral under the decisions to which I referred, is a question of great import11nce, which I do not think it necessary to discuss, by reason of the opinion which I have formed upon the former of the questions which arise in the case. Having regard to the nature of the demised premises, and to the character of the covenant in question, I am clearly of opinion that it is one which touches and concerns the premises demised by the lease within the meaning of the resolution in Spencer’s Case (l Sm. L.C. (11th ed.), p. 55), as interpreted by subsequent decisions.
The premises so demised consist of a dwelling-house, one of a number of villas facing Ballyholme Bay. Each villa has a strip of garden running down to a road, and on the sea side of the road there is a grass slope or embankment, beyond which there isa sea-wall, constructed in 1884 by the predecessor in title of the plaintiff for the protection of his property, which is from its situation, and from the composition of the soil, liable to erosion and to consequent encroachment by the sea. It is found in the case that the whole of this wall is necessary for the protection of the coast, and that the result of the non-repair of a breach would be the destruction of the wall by the action of the waves admitted by the breach, and the consequent destruction of the roadway and ultimately of the subject-matter of the demise.
That a covenant which is conversant with the preservation and protection from destruction of the subject-matter of a demise may be fairly regarded as one which touches and concerns it, is a proposition which commends itself to general accept ance. But the second resolution in Spencer’s Case (l Sm. L.C. (11th ed.), p. 55) has been overlaid with so complicated a mass of technicalities that it behoves us to consider whether any principle has been laid down in decided cases, in obedience to
which we are bound to act in applying to any particular covenant the apparently plain and simple language of the resolution.
The defendant contends that this· covenant should be regarded as collateral for three reasons. First, because it is conversant with a thing to be done on the land of the reversioner, and not on the demised premises. Secondly, because the subject matter of the covenant is the payment of money otherwise than by way of redde ndum under the demise; and thirdly, she relies on the decision of the English Court of King’s Bench in Dewar v. Goodman ([1908] 1 K.B. 94) as laying downa principle which we ought to apply to the present case.
As regards the first of these contentions, I should be disposed to regard as collateral a covenant by a lessee to build a house, to repair a wall, or to do any other work on land outside the demised premises, even though it were on the land of the reversioner, in the absence of some clearly established relation between the work to be done and the user and enjoyment of the demised premises. When sucha
relation exists, there is ample authority for treating the covenant as one which runs with the land.
The existence of this relation may be established in different ways. In Vyvyan v. Arthur (l B. & C. 417) the covenant was by the lessee of certain land to grind corn aat mill situated on the land of the lessor. ‘It is said that as the thing required to be done by the covenant is not to be done upon the land demised, but upon other land which might or might not continue to be the land of the lessor, it does not, therefore, respect the land demised, and, consequently, that the assignee cannot take advantage of the covenant. I am of opinion, however, inasmuch as the thing to be done is to be done at a mill which belonged to the lessor at the time of making the lease, and which has always continued to belong to the owner of the reversion of the land demised, that the covenant to be implied from the reddendum is in the nature of a covenant to render a rent, and, consequently, that it is a covenant that ran with the lands’ (per Holroyd, J.). Best, J., observes (p. 417): ‘The general principle is that if the performance of the covenant be beneficial to the reversioner, in respect of the lessor’s demand, and tC!Ji no other person, his assignee may sue upon it; but if it be beneficial to the lessor without regard to his continuing owner of the estate, it is a mere collateral covenant, upon which the assignee cannot sue.’
The Court in that case was enabled to apply these general observations to the covenant before it by regarding it, by way of implication from the reddendum, as in
the nature of a covenant to pay rent; and Mr. Overend, in an ingenious argument, has endeavoured to call in aid the particular reasoning upon which Vyvyan v. Arthur (l B. & C. 417) was decided. But, to my mind, the connexion in this case between the covenant and the demise is so direct that it is unnecessary to have recourse to the artificial reasoning upon which that decision was founded, even if it were applicable to the present case. I can conceive no relation more close than that between a house built on the sand, and the sea-wall which protects it from the action of the sea. The encroachment of the sea along a portion of our coasts is a matter of common knowledge; and the right to protection by the natural barrier of sand and shingle, or by artifical walls or embankments, has come before our Courts in various forms. The case of Morland v. Cook (L.R. 6 Eq. 252) was not a case between landlord and tenant, and is not directly in point as regards the present case. But it is of value, as illustrating the close relation which, in the eye of a Court of Equity, as well as a matter of common understanding, exists between land liable to encroachment from the sea, and the maintenance of the protecting sea-wall.
Inasmuch as the covenant in the present case is conversant with the preservation
of the subject-matter of the demise, it touches and concerns the things demised more directly than a class of covenants which have always been regarded as running with the land. I refer to covenants which affect the user of the demised premises; by which I mean the mode of user, and not the profit to be derived from the user, for covenants of the latter class are only collateral: Thomas v. Hayward (L.R. 4 Ex. 311). The case of Easterby v. Sampson (9 B. & C. 505; 6 Biag. 644) is an authority for the proposition that a covenant by a lessee affecting the user of the demised premises will run with the land, although the act to which the covenant relates is to be done on land of the lessor, outside the limits of the demised premises. The covenant in Easterby v. Sampson (9 B. & C. 505; 6 Biag. 644) was to build a new smelting-house on a part of the lessor’s waste land which was not included in the demised premises, but adjoined them. It was held by the Court of Exchequer Chamber, affirming the decision of the Court of King’s Bench, that, inasmuch as the covenant affected the mode of enjoying and using the thing demised, the principle laid down by Lord Ellenborough in Mayor of Congleton v. Pattison (10 East, 135) applied. ‘It is impossible to doubt that the demise of the mines is immediately connected with the possession of the smelting-mill’ (per Alexander, C.B., at p. 650). Upon the same principle it has been decided in several cases, of which the decision of the Court of Appeal in England, Clegg v. Hands (44 Ch. D. 503), may be taken as an example, that a covenant as to the manner in which a particular business is to be carried on upon the demised premises will run with the land.
I now proceed to consider the second point relied on by the defendant’s counsel – the circumstance that the covenant is conversant with the payment of moneys. In Vernon v. Smith (5 B. & Aid. 1) the lessee of certain premises situated within the weekly bills of mortality covenanted with the lessor at his own expense to insure the demised premises in a certain amount in a public office in London or Westminster. Under the provisions of 14 Geo. 3, c. 78, the landlord of premises lying within those limits had a statutory right to have the amount of the insurance laid out in rebuilding the premises. This circumstance, in the opinion of the Comt of King’s Bench, brought the case within the principle thus stated by Abbott, C.J.: ‘A covenant to lay out a given sum of money in rebuilding or repairing the premises, in case of damage by fire, would clearly be a covenant running with the land, that is, such a covenant as would be binding on the assignees of the lessee and which the assignee of the lessor might enforce.’ There are some observations in the judgment of Best, J., which are applicable to the present case – ‘A covenant in a lease of which the covenantee cannot, after his assignment, take advantage, and which is beneficial to the assignee as such, will go with the estate assigned. If this were not the law, the tenant could hold the estate discharged from the performance of one of the conditions on which it was granted to him. The original covenantee could not avail himself of this covenant; he sustains no loss by the destruction of the buildings, and, therefore, has no interest to have them insured By the terms
collateral covenants which do not pass to the assignee, are meant such as are beneficial to the lessor, without regard to his continuing the owner of the estate.’ In Vernon v. Smith (5 B. & Aid. 1), as in the present case, the covenant was to be performed by the payment of money. The money paid could not, as in Vyvyan v. Arthur (l B. & C. 417), be regarded as in the nature of rent. It was money to be paid to a stranger, not, as here, to the lessor. The connection between the money and the demised premises depended on the fact that the expenditure would result in the restoration of the premises if destroyed by fire. In the present case the money is to be paid for protection against destruction by water. Restoration and preserv ation are no doubt different things, but I can see no distinction between these things relevant to the question how far each of them touches and concerns the
subject-matter of the demise.
It remains to consider the question of the application to the present case of the decision of the English Court of Appeal in Dewar v. Goodman ([1908] 1 K.B. 94) on appeal from Jelf, J. ([1907] 1 K.B. 612). The distinction between that case and the present becomes apparent on rnading the following passage in the judgment of Buckley, L.J.: ‘The construction for the plaintiff may I think, be summarized as follows: A covenant to do an act, not in respect of the demised premises, but which will protect from forfeiture the estate of the demised premises, is a covenant which runs with the land. If that proposition is true, it is wholly new. It may nevertheless be true, but I am not aware of any authority in support of it.’ The distinction here taken between the estate of the lessee in the demised premises, and the demised premises themselves, is the foundation of the judgment of the learned Lord Justice. The same distinction runs through the judgment of Lord Alverstone, C.J.: ‘The covenant in the present case is a covenant to do something on land which was not the subject of the demise, but it is contended for the plaintiff that, as the perform ance of the covenant was for the benefit and protection of the sub-lessee, and concerned his interest or estate in the land, that is sufficient to bind the assigns; and cases were cited for the purpose of showing that the terms “estate” and “land” were in this construction to be treated as equivalent. But the important thing to observe with regard to the cases cited was that in every one of them the covenant did touch and concern the land demised, in the strictest sense of the word’ (p.103). And further on, at p. 104, he uses the words ‘interest of the lessee in the land demised’ as denoting something different from the land itself, or the user of the land. It is evident from the concluding portion of the judgment of Jelf, J., at p. 623, that if he had not been hampered by the technicalities which have been engrafted upon the clear and simple language of the resolution in Spencer’s Case (l Sm. L.C. (11th ed.), p. 55), he might have held with counsel for the plaintiff that ‘the covenant in question for performance of the covenants of the head lease does pro tanto touch or concern the thing demised in that, if performed, it secures the possession of it by preventing eviction on that ground by the superior landlord, and if not performed it forfeits the underlease.’ ‘It may be,’ he added, ‘that the Court of Appeal, if the case is carried there, may be able to take a broader view of the matter, and to break through the legal technicalities which a Court of first instance feels constrained to observe.’
The particular gloss on Spencer’s Case (l Sm. L.C. (11th ed.) p. 55) by which Jelf, J., was chiefly influenced was a passage in the judgment of Lord Ellenborough in the case of Mayor of Congleton v. Pattison (10 East. 135), to which I have already referred, where he says that a covenant is assignable if it affects the nature, quality, or value of the thing demised, independently of collateral circumstances, or if it affects the mode of enjoyment. Here is to be found the true ground of distinction between the past and present case and Dewar v. Goodman ([1908]1
K.B. 94). A covenant relating to the preservation from destruction of the thing demised, affects not merely its nature, quality, or value, but its very existence. Without discussing the grounds upon which it was decided that the covenant in Dewar v. Goodman ([1908] 1 K.B. 94) did not come within the resolution in Spencer’s Case (1 Sm. L.C. (11th ed.) p. 55), we can have no difficulty in discern ing, or acting upon, the essential difference which exists between the relation born by the covenant in that case to the title to the premises, and in the present case to
the very subject-matter of the demise.
A question was suggested during the argument, which if answered in the affirma
tive would be conclusive of the case: whether a covenant is not implied on the part of the lessor to maintain a protection to the demised premises, the repair of which is admitted to be necessary. The existence of such a liability on the part of the lessor, and the mode of enforcing it – whether by action at law, or by proceeding in equity, in which the lessee would be a plaintiff, and the lessor and the other contributory lessees defendants – are questions of some nicety, as to which I should not like to express an opinion without further consideration and argument. It is not necessary for me to do so, for I am clearly of opinion, for the reasons which I have stated, that the covenant on the part of the lessee, regarded as unilateral, is one which nearly touches and intimately concerns the demised premises, and therefore runs with the land.
Kenny J,:
Two matters have to be borne in mind in dealing with this case: the one, that the
claim arises out of and in connection with the relation of landlord and tenant, and the other, that the person who is suing is the original lessor in whom is vested the property in both the wall and the reversion expectant on the determination of the defendant’s lease. It is the lessor who, as such owner of the reversion and of the wall, has made the outlay in the repair of the latter. The only point in the case is whether the assignee of the lessee’s estate is liable under the covenant fora proportionate part of the expenses incurred in the carrying out of a work which, on the facts as stated by Wright, J., is essentially necessary for the preservation of the defendant’s house and premises. So far as merits are concerned they would seem to
be altogether on the side of the plaintiff.
It is said that this covenant for contribution is not one that runs with the land so
as to lay the burthen of its performance on the shoulders of an assignee of the lessee’s estate; that it is a mere collateral covenant, not touching or concerning the demised premises; and that while the lessee might be personally liable on foot of it, his assignee is under no such liability to the owner of the reversion. Even if that contention were correct, it might not save the defendant from ultimate liability, for, if the assignment from the lessee to the defendant be properly drawn, it will most likely be found to contain a covenant on the part of the defendant to indemnify the lessee from the effects of any breaches of the covenants contained in the lease. However that may be, we have to deal only with the question of liability between the reversioner and the assignee of the lessee’s estate.
The branch of our law conversant with the subject of covenants running with the
land is of an extremely technical character, and the authorities that bear upon it are in many instances on the border-line and difficult of application to any set of so essential to the continued existence of
the defendant’s house, cannot it be circumstances other than those on which they rest. All the cases establish that if the covenant be purely personal and collateral to the thing demised it does not run with the land – while, on the other hand, if it touches or concerns the subject-matter of the tenancy, it does run with the land and is binding on assignees of the covenan tor’s estate. In some of the cases a more exhaustive definition of a eovenant running with the land will be found.
In Sampson v. Easterby (9 B. & C. 505; 6 Bing. 644) it was held to run with the reversion on the ground that the thing covenanted to be done tended to the support and maintenance of the thing demised. In The Mayor of Congleton v. Pattison (10 East, 130) Lord Ellenborough in his judgment declares that the covenant would bind the assignee ‘if it affected the nature, quality, or value of the thing demised, independently of collateral circumstances, or if it affected the mode of enjoying it’; and in Athol v. The Midland Great Western Railway Co. (LR. 3 C.L. 333), Whiteside, C.J., in delivering the judgment of the Court refers to the covenant in that case as relating ‘directly to the nature and occupation and enjoyment of the very thing demised and connected with it.’ Cotton, L.J., in his judgment in Austerberry v. The Corporation of 01(1,ham (29 Ch. D. 750), discusses the two classes of covenants, and at p. 776, says: ‘In order that the benefit may run with the land, the covenant must be one which relates to or touches and concerns the land of the covenantee . . . Looking at the terms of the covenant it is … not a covenant having a direct reference to the land, or the enjoyment or the benefit of the land of the covenantee.’ Clegg v. Hands (44 Ch. D. 503) was also a case relating to the benefit of a covenant running with the reversion, where the demise was of a public-house, and the Jessee had covenanted to buy all his beer from the lessors whose assignees were the plaintiffs. At the close of his judgment, Lopes, L.J. says: ‘In my opinion, it touches and concerns the demised premises; it affects the mode of enjoyment of the premises, and, therefore, it runs with the reversion.’ On the other hand, Thomas v. Hayward (L.R. 4 Ex. 311), if it be still good law, is an authority for this – that touching the beneficial occupation of the thing is not equivalent to touching or concerning the thing itself. Lord Alverstone, C.J., in Dewar v. Goodman ([1908] 1 K.B. 94; affirmed H.L., W.N., 1908, p. 250) remarks that ‘it is said that Thomas v. Hayward (L.R. 4 Ex. 311) cannot now be considered as good law,’ but he adds that he cannot accept that view; but Buckley, L.J. considers that the Chief Justice has placed too much reliance on it, and proceeds to distinguish it. In my opinion, the covenant in the present case is directly connected with the demised premises. It was entered into as part of a scheme for the protection of, amongst others, the lessee’s villa residence, which might, in the absence of the wall in question, suffer material damage from the encroachments of the sea. If the lease had been taken without any reference to this wall, it might have become necessary for the defendant, in order adequately to protect his own premises, to take steps for the repair of the wall. I rather incline to the opinion that
a frontager to the sea in his position could take steps of this nature. If he were obliged to do so, how was he to be repaid his outlay beyond the proportion of it which his own premises ought to bear? I think the covenant affords an arn;wer. Furthermore, the lessor might have assumed sole liability for the maintenance of the wall, and, if he did, it is not unreasonable to conclude that the rent reserved would have been larger. In my opinion, it follows that there was a consideration for the covenant arising from the very nature, value, and condition of the thing demised. Apart from this, the covenant may be regarded as one to co-operate for the purpose of maintaining a work that is a common protection to the demised premises and to the lessor’s other property. If, as is found by Wright, J., the wall is regarded as in a sense partaking._pf the very essence of the frontagers’ houses, and being part and parcel of the very premises themselves? In my opinion, the latter are so dependent on it for not alone stability, but their very existence as habitable structures, that it is as much a part of the premises as their very foundations. The
.covenant contemplates the doing of an acfon premises so situated, and to my mind is equivalent to a covenant providing for the apportionment of outlay on the premises specifically demised by the lease. If the covenant was one to repay the lessor any outlay he might expend on the premises within the ambit of the lease, there could be no doubt that such a covenant would run with the land.
A case, Morland v. Cook (L.R. 6 Eq. 252), not unlike the present, came before Lord Romilly, M.R., in 1868. In one particular it differed from it, namely, that it was not a case of landlord and tenant, but one in which the covenant was contained in a partition deed. The several parties to the deed mutually covenanted with one another that the expenses of maintaining a sea-wall should be borne by them, their heirs and assigns, out of the partitioned lands in proportion, and by an acre-scot, payable thereout. It was impossible to say in which of the parties the ownership of the wall – which constituted the southern boundary of the land – was vested. The defendants’ lands were situated just within the wall, and did not anywhere abut on the sea. The defendants were assignees, and the suit was instituted for a declaration that they were bound to contribute to the repair of the wall. It was argued that the covenant ran with the lands, and also that it was in affirmance of a common law liability, and Rex v. Commissioners of Sewers in Essex (1 B. & C. 477) was relied on. Lord Romilly, in giving a decree in favour of plaintiffs, said that the thing to be done by force of the covenant was annexed to and appurtenant to the land partitioned – which goes with the land and binds the assignee though not men tioned.
Morland v. Cook (L.R. 6 Eq. 252) is open to the observation that the contri bution was by the partition deed actually made a charge on the contributory land, and this criticism was directed against its weight in the case to which I have already referred of Austerberry v. The Corporation of Oldham (29 Ch. D. 750), where the Court held that a covenant in a purchase deed to maintain a road did not run with the land adjoining. Cotton, L.J., in that case, while admitting to some extent the force of this objection, does not express disapproval of the actual decision or of the arguments by which Lord Romilly justified it. He even adds (p. 777), ‘but as regards benefit, a covenant for the keeping up of a sea-wall which would prevent the land in question owned by the plaintiff from being flooded was undoubtedly a covenant with reference to the benefit to be enjoyed by the land by the keeping of the sea out.’ Lindley, L.J., considered that Morland v. Cook was intelligible on the ground that the expense was practically created a rent-charge out of the lands. Fry, L.J., expressed a less decided opinion as to the benefit of the covenant not running with the land, and added that he was more inclined to think that the road in question was so far an incident to the use and occupation of the adjoining lands that it might be conceivable that it came within the principles of ‘covenants relating to things incident to the land.’
I am therefore of opinion that the covenant in the present case runs with the
land, and that the defendant, as assignee, is liable for her proper proportion of the expenses of repair incurred by the plaintiff.
As to the other point that was argued, namely, that, whether the covenant ran with the land or not, it was one that came within the 12th section of Deasy’s Act, it is enough for me to say that I am of opinion that the liability to contribute to the repair of the wall was an incident of the tenancy when the defendant purchased the lessee’s interest, and that as assignee of that interest she is liable under the section for the contribution.