CHAPTER TWO – UNLAWFUL EVICTION (CONTRACTUAL CLAIMS)

This chapter looks in broad terms at contractual causes of action for unlawful eviction. When faced with an allegation of unlawful eviction, it is necessary to ensure that the facts of the client’s case stack up against the various causes of action which may be available. It is common for claims based on breach of the covenant for quiet enjoyment to be wrongly brought in circumstances where there is no subsisting tenancy agreement, for example. This chapter sits alongside Chapter 3 concerning claims in tort. Consideration of both is necessary to formulate or respond to a claim for unlawful eviction. The key to maximizing your chances of success in any claim for unlawful eviction whilst avoiding adverse costs consequences is choosing your weapons wisely.

The civil causes of action available for unlawful eviction can be separated into two categories, namely contract and tort. This chapter deals with the former. A claim for breach of contract will turn on the express and implied terms of the agreement, whether written or oral. What follows below is a summary of the two main contractual causes of action that would ordinarily be applicable in a claim for unlawful eviction.

QUIET ENJOYMENT

Many tenancies and licences contain specific covenants or terms which deal with a tenant’s or licensee’s right to remain in occupation of the demised premises without being disturbed or evicted. In the context of tenancies, this is often referred to as an express or implied covenant for quiet enjoyment.

Technically, the right to quiet enjoyment does not apply to licences but each licence will be subject to its own contractual rights and obligations (whether express or implied) relating to interference with the right of occupation. The fact that a purported licence includes reference to the occupant being entitled to quiet enjoyment of the premises is a strong indicator that the occupant enjoys exclusive possession of the premises and therefore is a tenant: see e.g. National Car Parks Ltd v Trinity Development Co (Banbury) Ltd [2001] EWCA Civ 1686; [2002] 2 P. & C.R. 18.

What is meant by the phrase “quiet enjoyment”

In the absence of an express covenant for quiet enjoyment, a tenancy contains an implied covenant which, for the purposes of unlawful eviction or harassment, is in broadly the same terms.

In Kenny v Preen [1963] 1 QB 499, CA, Pearson LJ observed (at p.511):

“The implied covenant for quiet enjoyment is not an absolute covenant protecting a tenant against eviction or interference by anybody, but is a qualified covenant protecting the tenant against interference with the tenant’s quiet and peaceful possession and enjoyment of the premises by the landlord or persons claiming, through or under the landlord. The basis of it is that the landlord, by letting the premises, confers on the tenant the right of possession during the term and impliedly promises not to interfere with the tenant’s exercise and use of the right of possession during the term. I think the word “enjoy” used in this connection is a translation of the Latin word “fruor” and refers to the exercise and use of the right and having the full benefit of it, rather than to deriving pleasure from it.

The nature of the implied covenant was explained in Budd-Scott v. Daniell [1902] 2 K.B. 351, 351-356; 18 T.L.R. 675, D.C. in judgments of a Divisional Court. Lord Alverstone C.J. said: “Apart from authority it would certainly seem, on principle and in common sense, that when one person agrees to give possession of his house for a time to another, that ought to carry with it an agreement that he, the landlord, and those claiming through him, will not dispossess the tenant during that time. Therefore, unless there is some special meaning attached to the word ‘demise,’ the good sense of the thing would seem to be that, upon an agreement to let, a covenant or contract was to be implied that the landlord and those claiming under him would not disturb the possession of the tenant. Unless driven to do so by authority, I should hesitate a long time before drawing any distinction in that respect between the words ‘agree to let’ and ‘demise’.”

The covenant therefore operates as a promise by the landlord (or those claiming through or under him, but not a superior landlord) not to interfere with the tenant’s exercise and use of the right of possession during the term.

Where, however, there is an express covenant, it excludes the implied covenant: Line v Stephenson (1838) 4 Bing NC 678; 5 Bing NC 183; Miller v Emcer Products [1956] Ch 304. For practical purposes this is unlikely to make a difference in a claim for unlawful eviction save, for example it may exclude a superior landlord’s liability for those deriving title under him or it may confer liability on a superior landlord. The terms of the lease must be scrutinised carefully to ascertain who may be liable for acts interfering with the tenants’ quiet enjoyment of the premises. An example of a lease inadvertently conferring liability on a superior landlord is found in Queensway Marketing Ltd v Associated Restaurants Ltd (1984) 271 E.G. 1106, (Ch) where the covenant for quiet enjoyment referred to the landlord but the lease defined “landlord” to include superior landlords.

Performance of tenant covenants not a condition precedent

The usual form of covenant for quiet enjoyment provides that the tenant is to have quiet enjoyment subject to the qualification of “the Tenant paying the rent hereby reserved and observing and performing the Tenant covenants.” This does not make the payment of rent, etc., a condition precedent to the performance of the covenant by the landlord: Hayes v Bickerstaff (1669) Vaugh 118; Edge v Boileau (1885) 117; Taylor v Webb [1937] 2 KB 283 (reversed on appeal on a different point [1937] 2 KB 290). Resultantly, where tenants are unlawfully evicted on the pretext that they owe rent arrears, this has no effect on the validity of their claim in contract (though as we will see, it may make a difference to the amount of damages ultimately recovered).

It might be argued that this result is the product of the specific words used but it is apparent from the discussion in Yorkbrook Investments Limited v Batten [1986) 18 H.L.R. 25, CA (concerning the construction of service charge provisions) and citation of Foa’s General Law of Landlord and Tenant, 8^th Ed., that “the question whether liability in respect of one covenant in a lease is contingent or not upon the performance of another is to be decided, not upon technical words, nor upon the relative position of the covenants in the case, but upon the intentions of the parties to be gathered from the whole instrument.” In the context of quiet enjoyment, it is axiomatic that a tenant’s possession of the demise is not unlawfully disturbed. The construction of any such covenant must therefore take place in the light of the various statutory restrictions and remedies available to landlords to remedy non-payment of rent such as taking possession proceedings in reliance on one of the rent-related grounds or bringing a money claim.

This issue is all the more important in the current climate. At the time of writing,¹ residential possession claims (amongst others) have been stayed for 90 days owing to the Coronavirus/COVID-19 global pandemic and will remain stayed for another two at least until 23.8.20: CPR PD 51Z (implemented on 26.3.20); MHCLG Announcement of Robert Buckland QC MP, and Robert Jenrick MP on 5.6.20. Additionally, the Coronavirus Act 2020 prevents inter alia private sector landlords from serving notices to terminate residential tenancies of premises in England and Wales until at least 30.9.20. This restriction applies to the service of notices under ss.8 and 21, Housing Act 1988 and requires a landlord to give at least 3 months’ notice in the prescribed form: s.81 and Sch.29, Coronavirus Act 2020.

It is a sad fact that some unscrupulous landlords, faced with tenants defaulting on their rent payments owing to their inability to generate income during the pandemic (as a result of illness, the closure of businesses and/or schools and lockdown restrictions) will not adhere to the law and will look to maximise their returns by evicting tenants in spite of the above provisions. The mere fact of such arrears accruing is not a justification for taking steps to unlawfully evict occupants.

Breach of the covenant

Unlawful eviction amounts to a breach of the covenant for quiet enjoyment. In many respects, it is the very thing the covenant is designed to prevent.

Acts falling short of unlawful eviction (whether they culminate in the tenant ceasing to occupy the premises or not) can also amount to a breach of the covenant albeit whether they do is a question of fact and degree. This issue is looked at in more detail in Chapter 5.

This is illustrated in Kenny v Preen (above) where Pearson LJ held (at pp. 512-513):

“I would decide on two grounds in favour of the tenant’s contention that there was, in this case, a breach of the covenant for quiet enjoyment. First, there was a deliberate and persistent attempt by the landlord to drive the tenant out of her possession of the premises by persecution and intimidation, and intimidation included threats of physical eviction of the tenant and removal of her belongings. In my view that course of conduct by the landlord seriously interfered with the tenant’s proper freedom of action in exercising her right of possession, and tended to deprive her of the full benefit of it, and was an invasion of her rights as tenant to remain in possession undisturbed, and so would in itself constitute a breach of covenant, even if there were no direct physical interference with the tenant’s possession and enjoyment. No case of this kind has ever been considered by the courts before, and I do not think the dicta in the previous cases should be read as excluding a case of this kind where a landlord seeks, by a course of intimidation, to “annul his own deed,” to contradict his own demise, by ousting the tenant from the possession which the landlord has conferred upon her.

Secondly, if direct physical interference is a necessary element in the breach of covenant that element can be found in this case to a substantial extent, as I have already stated.”

Whilst the direct actions of the landlord or his agents would obviously fall within the scope of the covenant, a landlord may also be in breach having authorised acts by another tenant (of e.g. a block of flats) which are prohibited under the lease: Duval v 11-13 Randolph Crescent Ltd [2020] UKSC 18; [2020] 2 W.L.R. 1167 (which turned on the fact the landlord was required to enforce breaches of covenant on behalf and at the cost of the lessees and would deprive himself of that ability by granting the proposed licence). Whether and to what extent a landlord may be liable for the acts of others is a question of construing the terms of the lease: see e.g. Queensway, above.

The importance of considering the terms of the lease as a whole is demonstrated in several recent cases looking at the extent to which a reservation (such as a right of access or to do building works) impacts on the covenant for quiet enjoyment. When assessing whether a particular act is in breach of the covenant for quiet enjoyment, it is therefore necessary to have regard to any express or implied reservations or exceptions within the lease: see Jafari v Tareem [2019] EWHC 3119 (Ch); Duval, above; Piechnik v Oxford CC [2020] EWHC 960 (QB).

The decision of Windsor-Clive, Earl of Plymouth v Rees [2019] EWHC 1008 (Ch); [2020] 1 P. & C.R. 8, discussed below in the context of derogation from grant, is also relevant to whether a breach of the covenant for quiet enjoyment has occurred.

Duration of the covenant

When the landlord’s interest ends, his implied contract for quiet enjoyment ends with it: Baynes v Lloyd [1895] 2 QB 610; Schwartz v Locket (1889) 61 LT 719.

Where a landlord enforced an order for possession made by a High Court judge in forfeiture proceedings by re-entry and the possession order was subsequently reversed, the covenant was held not to apply because so long as the order was in force it was to be obeyed and acts done under it were lawful: Hillgate House v Expert Clothing & Sales [1987] 1 EGLR 65.

NON-DEROGATION FROM GRANT

What is meant by the phrase “non-derogation from grant”?

The phrase “non-derogation from grant” is not confined to the landlord and tenant relationship but where used in that context, it means that a landlord cannot “take away with one hand what he has given with the other”: Harmer v Jumbil Nigeria Tin Areas Limited (1921) 1 Ch 200 at 225 to 226; and Molton Builders Ltd v City of Westminster (1975) 30 P & CR 182 at 186; Platt v London Underground [2001] 2 EGLR 121 at p.4.

It is a covenant which most commonly operates where the landlord retains control over adjacent land such as common parts and acts or omits to act in relation to that land such that the demised premises becomes “unfit or substantially less fit than the purpose for which they were let”: Brown v Flower (1911) 1Ch 219 at 225, as per Parker J; Platt (above).

Key principles

The key principles governing derogation from grant were summarised in Platt (above) at pp.4-5.

• There is a very substantial degree of overlap, between the obligation not to derogate from grant, the covenant for quiet enjoyment, and a normal implied term in a contract (see e.g. Southwark Borough Council v Mills (1999) 4 AER 449 at 467F where Lord Millett explained that the former two amount to much the same thing).

• One should give effect to “the obvious intention of the parties, so as to give the transaction between them a minimum of efficacy and value which upon any view of the case it must have been their common intention that it should have”: Bowen L.J. in Myers v Catteson (1889) 42 Ch D 470 at 481.

• The extent of the obligation not to derogate turns on what obligations, if any, on the part of the grantor can fairly be regarded as necessarily implicit, having regard to the particular purpose of the transaction when considered in the light of the circumstances subsisting at the time the transaction was entered into”: Sir Donald Nicholls V.C. in Johnson & Son Ltd v Holland (1988) 1 EGLR 264 and 268A.

• The express terms of the lease are relevant to determining the extent of the obligation not to derogate, and should, if possible, be construed so as to be consistent with what Hart J. called “the irreducible minimum” implicit in the grant itself. However, a covenant relied on by the landlord “if construed as ousting the doctrine in its entirety is repugnant … and should itself be rejected in its entirety”: see Petra Investments Ltd. v Jeffrey Rogers plc (2000) LTR 451 at 471.

• What is also relevant are the surrounding circumstances at the date of the grant as known to the parties: Chartered Trust plc v Davies (1997) 2 EGLR 83 at 87C, per Henry L.J.

The overlap between breach of quiet enjoyment and derogation
from grant

It is common for practitioners dealing with unlawful eviction claims to elide quiet enjoyment and derogation from grant because commonly, the two causes of action provide the same relief in respect of the same complaints (Southwark LBC v Mills, above). In Windsor-Clive, Earl of Plymouth v Rees [2019] EWHC 1008 (Ch); [2020] 1 P. & C.R. 8, we are reminded that the mere fact a lease refers to a right of entry enabling a landlord to enter premises “at all reasonable times for all reasonable purposes” does not give carte blanche to enter for any purpose the landlord might categorise as “reasonable”. Insofar as such a reservation were relied upon by a landlord to justify acts which would otherwise amount to breach of quiet enjoyment or derogation from grant, the reasoning of Windsor is illuminating.

When construing an exception or reservation in a lease (such as a right of access onto demised land):

• that exception or reservation must be construed so as to preserve its validity yet as restrictively as is required to avoid a derogation from grant or a conflict with the covenant for quiet enjoyment;

• the application of the standard principles of construction will tend to lead the court to expect that substantial qualifications of the rights to exclusive possession and quiet enjoyment of the demised premises will appear clearly from the lease;

• apparently broad and unqualified words in reservations may, on closer examination, be found to have a more restricted meaning when read in their immediate or wider textual context

• if it is not possible to construe an exception or reservation in a manner consistent with the ‘the irreducible minimum’ implicit in the grant itself, it will be struck down as being repugnant to the lease;

• the contra proferentem rule operates only if the exception or reservation is ambiguous, in the sense that the court is unable to decide on its meaning by the use of the materials usually available for interpretation;

• if forced to have recourse to the contra proferentem rule, the correct position is that the reservation operates as a re-grant by the tenant and therefore the reservation falls to be construed against the tenant, who is considered to be the proferens.

The lesson to take from the above is that the extent of the covenant for quiet enjoyment/the scope of the grant is not determined by taking the express exceptions or reservations at face value but rather by first construing the extent of the exception or reservation in a way which does not go beyond the “irreducible minimum” implicit in the grant. In the example of a broad “reasonableness” reservation such as the above, Windsor held that “reasonableness” related to the relationship of landlord and tenant and so would be constrained by matters such as a right of inspection or to effect works of repair. It did not extend to damaging the land, cordoning off parts of the land, drilling boreholes or erecting structures on the demised land. Insofar as a landlord sought to justify excessive interference with the tenant’s occupation of the premises by reference to an exception or reservation (such as refusing to admit the tenant whilst repair works were carried out), those advising either party should be quick to assess (looking at the express and implied terms of the tenancy) whether such justification was sustainable in the light of the above.

Breach of the covenant not to derogate from grant

In the context of a claim for unlawful eviction, the circumstances which give rise to the breach of quiet enjoyment, i.e. the landlord’s unreasonable interference with the tenant’s right to possession are likely to found a claim for derogation from grant at the same time.

It is also apparent from the above that where a licence to occupy is granted for the purpose of providing accommodation and nothing else, it is likely to be an implied term of the licence that the licensee is entitled to enjoy his rights under the licence without interference which would undermine the “minimum efficacy and value which upon any view of the case it must have been their common intention that it should have”. Thus, though not expressed in terms of derogation from grant, acts or omissions which contravene the terms of the licence, express or implied, will serve a similar purpose.

The act of a landlord in entering premises without permission, removing a tenant’s belongings, changing the locks and refusing to permit access are hallmarks of derogation from grant. Other acts, such as sending harassing text messages may more properly constitute a breach of the covenant for quiet enjoyment but not amount to a derogation from grant. Whether they will do so is a question of fact and degree. Depending on the facts of the case, it is wise in every case to consider pleading the two causes of action in the alternative for this reason.

POINTS TO NOTE

• A claim for breach of contract will turn on the express and implied terms of the agreement, whether written or oral. It is imperative to obtain a copy of the most recent written tenancy agreement and ensure that comprehensive instructions are taken on what matters relating to the tenancy were agreed orally.

• If a client occupies pursuant to an excluded tenancy (or licence) then practitioners should look to the terms of the occupancy agreement (express and implied) to check that contractual and (in any event) reasonable notice has been given. Any failure to provide notice in accordance with agreed terms would give rise to a claim for breach of contract.

• The implied covenant for quiet enjoyment does not apply to licences but that does not prevent a licence from containing express (or implied) terms relating to the occupant’s enjoyment of the premises (such as access at reasonable times of day to provide any services).

• The implied covenant for quiet enjoyment is a promise by the landlord (or those claiming through or under him, but not a superior landlord) not to interfere with the tenant’s exercise and use of the right of possession during the term.

• An express covenant for quiet enjoyment excludes the implied covenant and its terms dictate the nature and extent of the right; so, it might exclude those claiming through or under the landlord or include superior landlords in its scope.

• Performance of the tenant covenants is not a condition precedent to the covenant for quiet enjoyment. It is a breach of covenant to evict without due process a tenant who has failed to pay rent.

• The covenant for quiet enjoyment remains for so long as the landlord’s interest subsists.

• There is significant overlap between the covenant for quiet enjoyment and the principle of non-derogation from grant. In the context of unlawful eviction (rather than acts falling short thereof), in most cases the two are virtually indistinguishable however practitioners should be alive to the fact that whether the act of physically removing a tenant from the premises (or acting in such a manner that this is the result) might fall within the scope of an exception or reservation.

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