Gilpin and ors v Legg [2017] EWHC 3220 (Ch) is a gift (at least to land law examiners) that is going to keep on giving. This is not just because of the claims discussed – whether beach huts were fixtures or chattels, whether a lease had been granted to the owners of the huts, whether the landowner was estopped from obtaining possession, and even certain pleadings issues (the pleadings do seem to have been a little, erm, jejeune) – but also because HHJ Matthews (who I’m ashamed to say I haven’t come across) added his tuppenies to a couple of controversies, not least making some important observations on the correctness of the Supreme Court judgment in Berrisford v Mexfield. Part of the problem in the case was that the events which underpinned the various claims happened over many years, were oral, and, in some cases, involved transfers of title (the issues of which were neatly stepped over by the judge who referred to bona fide purchasers, so we might be dealing with unregistered land, a point not made clear).
By way of summary, the problem in the case was whether Mr Legg was entitled to possession of land on which the Claimants had beach huts. The Claimants had bought beach huts from those who had put them up in the first place, but such purcases were subject to the landowner’s consent (ie Mr Legg or his predecessors in title). Mr Legg’s predecessors in title had seemed to grant what were sometimes called leases, and charged what all parties referred to as rent annually, for the use and occupation of the land on which the huts were sited. Mr Legg’s predecessors in title had also told at least some of the Claimants’ predecessors in title that they could stay there as long as they liked as long as they kept to the agreement. I have left out of this summary a couple of facts which are superfluous for what follows (including the fact that the landowner had granted a lease to a quarry company of the land; and the pleadings issues).
Chattels or fixtures?
The first question, which actually was neither here nor there, was whether the beach huts were chattels or fixtures. Most were on blocks and held down by their weight and a number of anchorage restraints. There was evidence that a couple of the huts could be removed without much damage, beyond the removal of (eg) a lean-to, but that at least one of them had been changed over time so that its removal could only be by dismantling it which would cause such damage that it could not be reconstructed. HHJ Matthews distinguished the leading (apparently similar) case of Elitestone Ltd v Morris [1997] 1 WLR 687 because those cases involved residential dwellings (and the planning permission for our beach huts excluded their occupation overnight – it seems to have been accepted that our beach huts were not dwellings). HHJ Matthews held, on the evidence, that it was an implied term of the agreement that the huts would be removed at the end of the agreement. At [58], he held that they were chattels:
This is not because it was clearly the intention of the parties that the huts should not form part of the land (although it was), but rather because there was either no annexation at all or only a very slight degree of annexation (and that in order to protect against movement by the wind), and the huts were when they were first placed there capable of being moved without risk of substantial damage.
Lease or licence?
The next question concerned the nature of the agreement in relation to the land on which the huts were sited. Here, he held that there was a periodic annual tenancy. This was for three reasons:
(a) the fact that, once sited, the huts excluded the landlowner and all others from the land: “… where a landowner grants the right to another person to site a hut or chalet of this kind, movable in practice only on the termination of the right, on his land, he is in substance granting a right to exclusive possession” ([64]); a finding which is at best questionable, I would suggest as it rather begs the question/is circular reasoning.
(b) the term was originally from year to year. At this point, the Berrisford argument was raised because it was said that the term became uncertain when the landowner told some of the beach hut’s owners that they could stay there for as long as they liked if they paid their rent and behaved properly. HHJ Matthews held that these assurances were undoubtedly made, but that they were personal to the hut owners and made after the agreements, so that Berrisford was not applicable. Astonishingly, or perhaps just boldly, though, he went on to criticise the reasoning of the Supreme Court in Berrisford, having been given some suasion by Southward Housing Co-Operative v Walker [2016] Ch 443 (our note). He questioned whether the tenancy for life principle in Berrisford could be applied. It is worth quoting his judgment at [85] here, because it suggests a position which appears to be being adopted at least in the High Court in relation to the cornerstone of the Supreme Court’s judgment:
As I read them, the passages from Bracton, Littleton and Coke on Littleton relied upon are referring to freehold life estates in land, and not to terms of years at all. Sheppard’s Touchstone makes exactly the point that “leases” with uncertain termination points could make good life estates, but not good terms of years. Re Carne’s Settled Estates deals with an equitable life estate prior to 1926, not a term of years. Doe d Warner v Browne is the case of an alleged tenancy from year to year where the argument that a valid term of years could still be created where the landlord had agreed not to give notice failed. Lawrence J pointed out that a life estate could be so created, but also that this was not that. So from these authorities it is clear that a freehold life estate could, and an (equitable) life interest still can, validly be made determinable on some earlier event than death. But these authorities do not, with respect, show that a term of years in the form of a periodic tenancy expressed to be not determinable by one side was to be treated before 1926 as a term of years for life but determinable earlier. So s 149(6) of the 1925 Act could have no application to such a case.
(c) the final point was that there was the payment of rent.
This led on to another problem though. If the agreements were, as he held, yearly tenancies, their oral grant would have been effective under s. 5492), but their assignments could only be made by deed: Crago v Julian [1992] 1 WLR 372. I know one or two people who question the correctness of Crago, but HHJ Matthews’ approach was to by-pass this rule because the landowner accepted the assignee of the lease (usually in return for a commission on the sale): “Whether that amounts strictly to surrender and re-grant of a periodic tenancy, or whether it is an assignment in equity for value which is good at least between the new hut owner and the landowner (even though it might not bind a good faith purchaser from the landowner) is probably not important. At any rate, before me it was certainly not argued so to be” ([91]). I can accept the surrender and re-grant point, but the assignment in equity point is rather odd (possibly).
Proprietary estoppel?
The final substantive argument was on proprietary estoppel. However, this was rather undercut by the finding that the assurances had been made personally, as opposed to having proprietary consequences. There is an interesting pointtaken about an omission to act operating as an assurance, and here (reading between the lines) HHJ Matthews appears to have applied (at [102]) something like the probanda in Willmott v Barber, although this is not expressly cited in the judgment and would be rather odd given its lack of authority in modern estoppel doctrine.
At this point, HHJ Matthews helpfully discusses the question of unconscionability, something which my students are asking me about just before their first assessment. HHJ Matthews says at [109] that “Modern authorities make clear that this is to be the touchstone for the question whether a proprietary estoppel has or has not been raised in a particular case against the defendant”. He asks (rhetorically) whether, if one were to rent a plot for a year tenancy and pay £20k to put up a hut on the land, would it be unconscionable for the landowner to ask me to remove the hut at the end of the first year? He answers not, because effectively this would be a commercial arrangement and both parties went in to the transaction with their eyes open (thus, placing it on the Yeoman’s Row side of the estoppel line).
Conclusion
The beach hut owners had an annual tenancy of the land on which their huts were sited, and that tenancy could be determined by notice of the relevant (common law) period. That notice was given and so they were required to give up possession (although I suspect there might be some negotiation).