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Chapter II of Part I of the Leasehold Reform, Housing and Urban Development Act 1993 confers a right on “a qualifying tenant of a flat” to acquire a new long lease of the flat from his landlord. The question raised on these two appeals was whether the lessee of premises (such as a block of flats), which included property other than flats, could be a qualifying tenant of any of the flats comprised in those premises.  This issue turned upon the proper construction of the 1993 Act, as amended.

In each of these cases, the whole (or most) of a self-contained building converted into a number of self-contained units, was let under a lease (“the head lease”) for 60 years at a ground rent. In Cadogan, the building had six storeys – the lower three were used as offices and the upper three consisted of a maisonette.  In Howard de Walden, the five storeys of a building had been converted into self-contained residential flats - the upper three were subject to long underleases, and the lower two were let by assured short-hold tenancies.

In each case, the head lessee served notice on the freeholder pursuant to Chapter II of Part I of the 1993 Act (“Chapter II”) to acquire, in Cadogan, a new lease of the maisonette, and, in Howard de Walden, a new lease of the ground floor flat, and, subsequently, a new lease of the basement flat. In each case, the freeholder served a counter-notice denying the head lessee’s claimed right, contending that the head lessee was not “a qualifying tenant” of the flat concerned.

The County Court held that the head lessee was “a qualifying tenant” of the relevant flat. The freeholders’ appeals were heard together by the Court of Appeal which allowed both appeals. The head lessee in each case then appealed to the House of Lords.

The House of Lords held (unanimously) that the appeals should be allowed and the decision of the first instance judge restored in each case.

The House of Lords found (as per Lord Neuberger of Abbotsbury) that (1) as a matter of statutory language, it appeared clear that a lessee under a lease of property which included a flat can be a “tenant” of that flat for the purposes of Chapter II of Part I of the 1993 Act, irrespective of the nature or extent of the other property included in the demise; (2) in particular, there was no reason to exclude a lessee under a lease of a block of flats, or a lease which included property other than flats, from being a “tenant of a flat” for the purposes of Chapter II of Part I of the 1993 Act; (3) there was no good argument to the contrary based on the policy of the 1993 Act; and (4) nor was there a good argument to the contrary based on the alleged practical difficulties, inconsistencies or oddities resulting from this conclusion.