Khan v Reece

• Jurisdiction: Trinidad & Tobago
• Judge: Bernard, C.J.
• Judgment Date: 31 May 1989
• Neutral Citation: TT 1989 CA 42
• Docket Number: Civ. App. No. 149 of 1988
• Court: Court of Appeal (Trinidad and Tobago)
• Date: 31 May 1989

Court of Appeal

Bernard, C.J., Edoo, J.A.; Sharma, J.A.

Civ. App. No. 149 of 1988

Khan

and

Reece

Appearances:

S. Marcus for the appellant

T. Malcolm-Milne for the respondent

Real property - Landlord and tenant — Rent

Landlord and tenant - Claim for arrears of rent and mesne profits — Rent Restriction Act, Cap. 59:50, ss. 7, 8, 9.

Bernard, C.J.

1 At the close of the arguments in this appeal the court dismissed it with costs, and ordered that an account be taken of arrears of rent and mesne profits due and owing by the appellant to the respondent. It said then that it would give its reasons later for so doing. This I now do. The premises at 47 and 49 Edward Street in Port-of-Spain were built before 1940. They were then owned by one Cecil Reece. In the course of time Mr. Reece let part of the premises at No.47 as a dwelling house. In the course of time too, he let a part of No. 49 for commercial purposes.

2 The rental for each category of letting had been fixed following separate assessments by the Rent Assessment Board. Eventually, the respective parties gave up possession. In 1979 Mr. Reece sold Nos. 47 and 49 to his daughter, Donna Reece (“the respondent”). Following this transaction the respondent did extensive repairs to the premises, as a result of which the two premises Nos. 47 and 49 became more or less combined (and it would seem thereafter were known as No.49) The two buildings are now separated from each other only by a passageway. The evidence is that the respondent's father remained in occupation of a portion of the premises.

3 By Deed No. 15065 dated 29 ^th July, 1980, the respondent leased a portion of No. 49 to the appellant, and attorney-at-law, for commercial purposes for a term of three years with an option for an additional two years. This said portion had originally been assessed by the Rent Assessment Board in 1957 as a dwelling. The rent was to be on a progressive scale - beginning at $1,000.00 per month and reaching $1,650.00 per month in the fourth year and $1,815.00 in the fifth, if the appellant had exercised the option.

4 In breach of the lease the appellant made structural alterations to the premises. He later subletted part thereof to another attorney. The respondent brought these breaches to the attention of the appellant and called upon him to remedy them. He paid no notice to her pleas. Instead, he was abusive to her and told her that no one could tell him what to do. The situation became more aggravated since the appellant fixed his own rent and paid this as and when he pleased. When approached on these and other differences, the appellant remonstrated with the respondent.

5 According to the learned trial judge, he indicated that he was aware that the premises were subject to the Rent Restriction Act (“the Act”) and that he was only prepared to pay the rental as originally assessed by the Rent Assessment Board. I digress to observe that there is nothing positive in the Notes of Evidence alluding to this knowledge and intention of the appellant, although the pleadings and the evidence in the case are such that allow for such an inference. Be that as it may, no objection had been taken to these remarks of the trial judge. Indeed, the appeal proceeded and was argued on this basis.

6 To continue: In due course - in the year 1982 to be precise - the respondent duly determined the lease and later in 1903 commenced proceedings against the appellant in the High Court, inter alia, for possession of the premises and mesne profits. The appellant held over until December of 1988 when he vacated the premises.

7 Between the date of the determination of the lease and the date when the appellant vacated the premises, he had paid no rent whatsoever. This is an appropriate stage for me to record that at the commencement of the hearing of the appeal attorney for the appellant indicated that he was prepared to accept unreservedly that the trial judge had jurisdiction to entertain the suit. Accordingly, the appeal was proceeded with on that basis. Several grounds of appeal were lodged against the judgment and order of the learned trial judge. It is unnecessary to resort to a detailed itemisation of them. It would suffice only to state that they sere directed to a resolution of the following questions:–

• (1) On the facts and circumstances were the premises controlled or not?

• (2) Whatever be the status of the subject premises, was the agreement void?

• (3) Assuming that the agreement was valid, could the respondent enforce it?

8 Attorney for the appellant contended that on the evidence it was clear that the premises were controlled, and that part of No. 47 (also known as 49A) and part of No. 49 (also known as 49B) had in fact been assessed albeit at separate times and for admittedly different purposes i.e. as a dwelling (49A) on the one hand and commercial purposes (49B) on the other. By reason of the provisions of s.8 s.s.2 of the Act the respondent, he contended, having sought a chance in the nature of the letting (49A) as it affected the premises, was under a duty to apply to the Board to fix a provisional standard rent.

9 Having omitted to do so she was guilty of a criminal offence and in consequence the contract, he submitted, was illegal and void. Alternatively, if the contract, he submitted was legal, it was, nevertheless, unenforceable on grounds of public policy. He relied on the case of Anderson Ltd v Daniel [1924] 1 K.B. 130 for the first proposition and upon Tucker v Grant [1961 – 1962] 4 W.I.R. 282 and Sabga v. Bahadoorsingh[1968] 13 W.I.R. 269 for the alternative one.

10 On the other hand, attorney for the respondent contended that the premises were decontrolled as from 1st March 1961, by virtue of the Exclusion Order in Part 2 - Paragraph 4 - of ache Schedule to the Act. This Order operated to exclude those premises from the provisions of the Act since that date. In order to appreciate the effect and extent of this order it will for convenience be recited here:

RENT RESTRICTION (EXCLUSION OF PREMISES) ORDER

• A2. The classes of premises described in the schedule are excluded from the operation of the Act as from the date specified in the schedule.

RENT RESTRICTION (EXCLUSION OF PREMISES) ORDER

SCHEDULE

PART 2

3

As from 12th February, 1960, every commercial building which at that date was not let to a tenant or occupied by a statutory tenant thereafter. 4. As from 1st March, 1961 without prejudice as to the operation of paragraph 3 every commercial building the standard rent of which exceeds the sums of $150.00 a month. 5. In this Part - “commercial building” means any building or part of a building used normally for business, trade or professional purposes, and includes land occupied therewith;”

11 As to this contention of attorney for the respondent I do not consider that it is sound. The structure in question was not a commercial building on 1st March, 1961. The evidence is that the contractual rent of $1,000.00 had been agreed and fixed and indeed the building had been occupied for use as a commercial building by the appellant more than nineteen years after the Exclusion Order of 1961.

12 The prescribed date - 1st March, 1961 -- in paragraph 4 of the Exclusion Order referred to is critical for the purpose of determining whether or not a commercial building was or was not excluded from the application of the Act at that date by reason of that Order. Thus, those commercial buildings that were let on or before that date were excluded from the application of the Act once the standard rent thereof on that date exceeded $150.00 per month.

13 See Greaves v. Smith [1963] 6 W.I.R. pg. 403 which was approved in Morales v. Birchwood P.C. Appeal No. 46/81. This, it seems to me, explains why as can be seen from the Schedule to the Act, there have been subsequent Exclusion Orders made under section 4 (1) of the Act. For the reasons I would reject the contention of the attorney for the respondent.

14 However, this is not an end of the, the matter by any means. Much depends upon how the Act is to be construed and in this case particularly sections 7, 8 and 9 thereof. The Act, I may add, has given rise to difficulties of a sort in its application to certain cases from time to time. The Morales case was one such. Nevertheless, much is to be gathered from this case as to the scheme and intent of the act. For the purposes of this appeal I shall concern myself in this judgment mainly with the Privy Council's particular observations with respect to the operation of sections 7 and 8 thereof.

15 In the Morales case Lord Scarman speaking for -the Privy Council said:–

“One of the matters in respect of which the Board has power to make a final judgment or order is the determination of a standard rent. The definition of standard rent is in section 2 (1), and is in these terms: –

“Standard rent’ in relation to premises let at the commencement of this ordinance, or hereafter let, means the standard rent of such premises ascertained in accordance with this Ordinance and appropriate to the category of letting in which the same are let;”

16 Its ascertainment is governed by sections 7, 8 and 9. Section 7 provides as follows: –

“Until the standard rent of any premises in relation to any category of letting has been determined by the Board under section 9, the standard rent of the premises in relation to that category of letting shall be the rent at which they were let in the same category of letting on the prescribed date or, where the premises were not so let on that date, the rent at which they were last so let before that date, or, in the case of premises first so let after the prescribed date, the rent at which they were, or are hereafter, first so let:”

“There then follows a proviso …………..Section 8 provides for applications to the board to determine standard rent. The section ensures that at all times...