Magnohard Ltd v Cadogan and others [2012] EWCA Civ 594 is yet another case dealing with whether a property can be a “house reasonably so called” and, hence, capable of being enfranchised under the Leasehold Reform Act 1967. There is quite a lot of law on this topic, although the leading case is probably Tandon v Trustees of Spurgeon Homes [1982] AC 755. In essence, if a proerpty can reasonably be considered to be a house, then it is for these purposes (even if it could, equally reasonably) be called something else. Hence properties which look like houses but now have some (possibly substantial) commercial units can be enfranchised. It is quite a fact-specific test, although, there is a bit of a debate going on about how and to what extent you should look at the development history, user covenants, etc, when making this assessment. The Supreme Court is having a go at that question in a few weeks (Hosebay v Day, I think, see our note here)
The building in question was built in 1888 and consisted of a basement, ground and five upper floors. It was originally built as (in effect) six flats, with a housekeeper’s flat and three small shops. The question was whether this could reasonably be called a house. The judge held that it could not. It was, in truth, a block of flats with three shop units. It was not a house which had been divided into flats (which would have been capable of being enfranchised).
An appeal to the Court of Appeal was dismissed. It was important to remember that the question was whether it could “reasonably” be called a house. It was clear that a purpose built block of flats could not reasonably be called a house. Depending on what happens in Hosebay, there may be a further appeal.