BARCLAYS BANK (D.C.O.) vs. THOME [1973] 2 GLR 137

CASES REFERRED TO

(1) Marsden v. Heyes (Edward) Ltd. [1927] 2 K.B. 1; 96 L.J.K.B. 410; 136 L.T. 593, C.A.

(2) Smyth v. Carter (1853) 18 Beav. 78; 52 E.R. 31.

(3) Yelloly v. Morley (1910) 27 T.L.R. 20.

(4) Doe d. Vickery v. Jackson (1817) 2 Stark. 293; 171 E.R. 651.

(5) Doe d. Dalton v. Jones (1832) 4 B. & Ad. 126; 1 Nev. & M.K.B. 6; 2 L.J.K.B. 11; 110 E.R. 403. (6) Hyman v. Rose [1912] A.C. 623; 81 L.J.K.B. 1062; 106 L.T. 707; 28 T.L.R. 432; 56 S.J. 535, H.L. reversing sub nom. Rose v. Hyman [1911] 2 K.B. 234; 80 L.J.K.B. 1011; 104 L.T. 619; 27 T.L.R.

367; 55 S.J. 405, C.A.

(7) Lambert v. Woolworth (F. W.) & Co., Ltd. (No. 2) [1937] 3 All E.R. 195.

NATURE OF PROCEEDINGS

APPEAL against the judgment of the High Court, Accra, that alterations made by the defendants to demised premises constituted waste and a breach of the covenant to repair. The facts are fully set out in the judgment of Jiagge J.A.

COUNSEL

J. B. Quashie-Idun for the appellants.

Dr. Ekow Daniels for the respondent.

JUDGMENT OF JIAGGE J.A.

This appeal is from a judgment given in favour of the plaintiff-respondent herein, by the High Court, Accra. The plaintiff’s claim was for possession of premises on the first floor of house No. D 762B/4 Kimberley Avenue, Accra, demised to the defendants on 16 September 1952 for a term of twenty years with an option for a further term of twenty years at the yearly rent of £2,415 for the first ten years payable every six months in advance, and £1,920 a year for the remaining ten years

[p.139] of [1973] 2 GLR 1 and any subsequent renewal thereof, also, payable every six months in advance. The plaintiff claimed that in breach of the covenant in the lease “To keep the interior of the demised premises and the doors, windows, fittings and landlord’s fixtures in good and tenantable repair and condition and to whitewash and paint or cause to be whitewashed and painted such internal parts that are usually whitewashed and painted,” the defendants extensively altered the entire structure of the interior of the premises. by pulling down a number of walls of the residential apartment, by removing some doors and stopping up others with sandcrete, by erecting new walls where none existed before, and by constructing an additional ceiling to the entire premises. That the defendants made all these alterations in “positive defiance of the plaintiffs’ expressed objections to the said structural alterations” claiming “an absolute right under the underlease to make the said structural alterations with or without the consent of the plaintiff.”

The defendants averred that the premises were demised for use as a bank, and that the residential apartments were constructed by the plaintiff, at the request of the defendants, in accordance with the terms of the underlease. The defendants denied committing breach of any of the convenants of the underlease but admitted making improvements and repairs to the interior of the premises. They denied that the alterations constituted waste, or a destruction of the premises, or that they affected in any way, the nature and use or the structure, of the premises.

On 14 February 1952, the defendants made certain proposals to the plaintiff, exhibit B, after having discussed previously with the plaintiff, the matter in issue. The proposals inter alia requested the construction of a strong room by the plaintiff in accordance with specifications provided by the defendants. The plaintiff was also to construct “staff quarters on the same floor . . . without extra charge” and tiling in the bathroom and kitchen were to be provided by the plaintiff.

Exhibit A2 is another letter from the defendants requesting that, “the right to sublet” be included in the terms proposed in exhibit Al.

On 18 April 1952, the defendants confirming an interview with the plaintiff held on 15 April 1952, agreed to the following:

“(a) We would agree to pay ten years rent in advance and you will provide the staff quarters. We will submit a sketch of the proposed layout to you.

(b) We would also agree to pay any increase in rates and taxes which might be imposed by the authorities during our tenancy.”

On 13 October 1952, the defendants provided the plaintiff with two plans giving details of the construction of the partitions and the position of the manager’s rooms (exhibit A4). Although there was no reply to any of the letters, Al-A4 written by the defendants to the plaintiff, it

[p.140] of [1973] 2 GLR 1 is clear from the correspondence that the plaintiff was in agreement with the proposed terms presented to him.

Meanwhile on 16 September 1952 the plaintiff and the defendants executed exhibit B, the underlease. Clause (h) of the underlease states as follows:

“To construct at his own expense and when requested by the sublease so to do on the first floor in such position and according to such specification as to number and size of room as may be determined by the sublease quarters suitable for the accommodation of at least two Europeans and in accordance with the general terms as to specification already agreed on between the parties hereto.”

On 23 December 1952, the defendants duly provided plan No. 23/6 drawn by Messrs James Cubitt Scott and Partners and requested the plaintiff to construct the living quarters in accordance with the said plan. Before the execution of the underlease, exhibit B, on 16 September 1952, however, the parties in a memorandum dated 19 July 1952, exhibit C, were agreed that notwithstanding the date of commencement of the terms granted (that is, 1 October 1952) the defendants should have the right to enter the demised premises before 1 October 1952 the date of commencement of the underlease, if they so desired but on payment of the rent reserved by the underlease for “the period from the date of such entry to 1 October 1952.” The defendants further reserved the right not to pay rent from 1 October 1952 the commencement date should the premises be unfit for occupation on that date.

On 9 April 1953 in exhibit A6, the plaintiff presented to the defendants the keys of the residential apartment with a list of the extra works requested by the defendants and the cost of each. The defendants apparently accepted the points raised in exhibit A6 and the correspondence between the parties which was friendly seemed temporarily to come to an end.

The next letter (exhibit A7) from the defendants to the plaintiff was on 29 September 1961, eight years after exhibit A6, and it was a proposal to make internal alterations to the premises. The defendants proposed further, to ask the architect to produce working drawings and specifications but before doing so, requested the plaintiff’s approval, in principle, and in writing. The defendants further sought an appointment to “discuss the plan yet again and to review the whole matter in greater detail.” According to exhibit A8 dated 13 October 1961, the discussions took place that morning and the defendants attached to exhibit A8 a draft letter which the plaintiff was requested to sign. The defendants wrote inter alia:

“I have made no real attempt to draw it in legal terms and I do not suggest that either one of us regard it as a legal document, I think however that it is sufficiently clear to express your intentions with regard to our alterations and that both you and the bank should give or accept it on this basis.”

[p.141] of [1973] 2 GLR 1

The draft attached to exhibit A8 also dated 13 October 1961 (exhibit A9) is as follows:

“Dear Sir, Following our conversation this morning, I confirm that I agree in broad outline to the alterations which you intend to make to the premises which you rent from me, it being understood that these shall be carried out at your own expense with the possible exception of wash room accommodation and the septic tank, the last of which is to be built to my specification and the cost of both of which may be the subject of further negotiations between us when final drawings have been approved by each of us.

I further agree that these alterations shall have no effect on the existing terms of your lease either as to consideration in respect of time or money . . . “

It is quite obvious that exhibit A9 was an attempt to reduce into writing the oral agreement reached at the meeting between the parties on 13 October 1961. One would expect the plaintiff to object to any part of exhibit A9 which was not a true statement of the agreements reached on 13 October 1961. There was no evidence of any such objection.

The next letter on record is exhibit A10 dated 23 July 1962 about nine months after the meeting held on 13 October 1961. Exhibit A10 states:

“Dear Sir, We refer to recent discussions between yourself and the undersigned, and between yourself and our local directors in Ghana about the existing lease covering these premises. We have given your proposals careful consideration and cannot see our way to meeting them. You must appreciate that we have a legal lease giving us the right to enjoy use of these premises for further period of thirty years and on terms previously agreed by you. We should like to make certain interior alterations at our own expense and for our own benefit we seek your consent. Your consent should not be unreasonably withheld and if it continues to be unreasonably withheld then we shall seek legal authority to make the alterations notwithstanding.

You have asked that the lease be redrawn, on terms more favourable to you, and to accommodate you we offer the following:

(1) We are prepared to increase the rent payable to £G2,700 per annum.

(2) We are prepared to take on responsibility for external decoration of this building at our own expense and to our own specification. (3) We are prepared to meet up to 50 per cent of the cost of the installation of a septic tank to your specifications or £G1,000 which ever is the less.

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In consideration of (1), (2) and (3) above you are to give your consent to the alterations we now propose to effect to the accommodation now occupied by us and your authority to us to make such alterations as we may think necessary in the future. You are to construct a septic tank for our benefit of adequate capacity for the needs of our staff, the cost to be divided as indicated in (3) above . . . On the assumption that the above terms are accepted by you, then we shall be prepared to offer ten years’ rent in advance, such rent to be applied in permanent reduction of your present overdraft . . .”

This letter exhibit A10 is the first indication of a change for the worse in the cordial relations between the parties. It shows also that in spite of the discussions held on 13 October 1961, the defendants were unable to carry out the proposed alterations. There is also an indication that the defendants’ suggested draft exhibit A9 was not signed by the plaintiff as he was requested to do and the defendants could not therefore undertake the said alterations. The plaintiff’s reaction to exhibit A10 was sharp and quite as unfriendly.

“Dear Sir, I refer to the proposed compromise offer of yours dated 23 July 1962. The answer is, NO with deep and sincere regret. In the circumstances I am inclined to temporarily revert to the original proposals made by request, on the 24th January, 1962 to Mr J. A. Scott, Director, Barclays Bank . . . “

The defendants’ reply to exhibit A11 states inter alia: “we hereby advise you that the terms of the existing lease will continue unchanged.”

On 24 August 1962, the defendants in exhibit A13 gave a detailed description of the alterations they intended to make and stated that they were providing the plaintiff the said information as a matter of courtesy. The defendants, however, gave the plaintiff an assurance that the structure of the building would suffer no damage whatever from the alterations proposed. On 2 June 1964, the defendants enclosed in exhibit A14 the plans prepared by their architect showing the general office arrangements after the alterations had been completed. The defendants again indicated that the plans were being supplied as a matter of courtesy.

The plaintiff claimed that he visited the premises in question on 13 October 1964 and for the first time saw the alterations being made. In a letter dated 22 October 1964, (exhibit A17) he asserted “As you are aware, I have never at any time agreed or consented to any alteration, improvements, modifications, whichever, whatsoever, to my property and to this major issue, I further have to draw your prompt attention.” In reply to exhibit A17, counsel for the defendants wrote to the plaintiff “The alterations being carried out by our clients are improvements to the property which they have leased from you, which improvements, they are entitled to make under their lease from you.”

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The High Court found in favour of the plaintiff and the defendants appealed to this court.

The issue whether or not the alterations in question are in fact capable of being deemed improvements depends on the nature or character of the subject-matter demised, the user expressly permitted by the lease, or one that may be implied from the nature of the transactions and from the use of certain technical words. Under the common law, alterations affecting the structure, form or character of the subject-matter demised would be treated as waste and not improvements, unless such alterations were permissible by the lease or sanctioned by the lessor. Alterations converting a dwelling-house into a shop were held to have constituted waste and not improvement: see Marsden v. Heyes (Edward) Ltd. [1927] 2 K.B. 1, C.A. A lessee who pulled down a house in spite of the lessor’s objections and built another which the lessor did not like was held liable for waste: see Symth v. Carter (1853) 18 Beav. 78. The issue whether or not the alterations change the nature or structure of the demised premises is a question of fact to be decided by the evidence available.

The architect who supervised the alterations complained of by the respondent gave evidence that partition walls were demolished and new walls were constructed where none existed before, but that the changes carried out did not, in any way, affect the structure of the building. He explained that by structure, he meant those components of the building that supported it. His evidence was not challenged in any way and since there was no evidence to the contrary, in my opinion, it should have been accepted as correct.

However, the learned trial judge found that the architect admitted structural alterations. This finding is not supported by the evidence before the court. Under cross-examination, the architect said:

“All the alterations could be taken off at the end of the lease. This can include the suspended ceiling. The central air-conditioning is mounted on blocks to prevent vibrations from the machine itself from passing into the building. This can also be removed without injury to the premises. If an attempt is made to remove the suspended ceiling it will affect the structure temporarily. It will not be necessary to remove the original ceiling to remove the suspended ceiling.”

To construe the evidence of the architect as an admission that there were structural alterations would, in my opinion, mean injury to language. The word “structure” has to be construed in relation to its context. The architect stated that by “structure” he meant those components of the building that supported it. This definition seems supported by the Concise Oxford Dictionary (14th ed.) at p. 1257 which states “structure, n. Manner in which a building organism or other complete whole is constructed, supporting framework or whole of the essential parts of something.” A reference to the components of the building that

[p.144] of [1973] 2 GLR 1 supported it, and the supporting framework of the building, cannot mean a reference to partition walls that were made after the building had been constructed. The learned trial judge misled himself on this issue. What the architect admitted was the demolition of the components of the building that did not support it. The evidence was that there was no damage to the supporting framework. The nature, the essential qualities of the building, was not in any way affected by the alterations. The fact that the demised premises, as shown on the plan exhibit D, are not the same as the property shown in the plan exhibit E is no conclusive proof that the structure of the subject-matter demised was affected. The learned trial judge misled himself on this issue also.

A tenant, unless user is restricted by the lease, has the right to use the demised premises for whatever purposes he likes provided, however, that such purposes are neither illegal, immoral nor a nuisance to others: see Yelloly v. Morley (1910) 27 T.L.R. 20.

Exhibits B and C together form the agreement between the parties and the purpose for the acquisition of the premises shown, quite clearly, in the underlease, is for the business of banking. The underlease, exhibit B clause (h), shows that the respondent herein agreed to construct at his own expense and when requested by the sublessee to do so, “quarters suitable for the accommodation of at least two Europeans, and in accordance with the general terms as to specifications already agreed upon between the parties hereto.”

The living quarters were in fact requested, constructed and occupied by the officers of the appellant bank for a number of years. The alterations which were the subject-matter of the dispute between the parties were in the main, the removal of the internal walls constructed in accordance with exhibit B, clause (h), and the building of walls where none existed before. The purpose of the alterations as stated by the appellants, was to improve the services offered to their customers. These services were the user contemplated by the parties at the time of the execution of the underlease which shows no restrictions as to such user.

The respondent as plaintiff in the court below, based his claim on the breach of covenant to repair. At common law, it is a breach of the covenant to repair, (unless the lease gives him the power to do so) if the tenant pulls down any part of the premises and makes alterations in them: see Halsbury’s laws of England (3rd ed.), Vol. 23. p. 595, para. 1284. The opening of a doorway between two houses was held to be a breach of the covenant to repair: see Doe d. Vickery v. Jackson (1817) 2 Stark. 293.

The learned trial judge, observed correctly that:

“The underlease and its supplement in fact do not contain any covenant in the following terms: ‘that the tenant agrees that he . . . will not without the written consent of the landlord make any alteration in or addition to the said premises whatsoever.’

[p.145] of [1973] 2 GLR 1

If, in fact, such a covenant had been in the agreement, it would have been very easy to hold that there is ample evidence to come to the conclusion that whatsoever was done to the premises constituted alterations within the meaning of the tenant’s covenant . . . “

This may be so, but the court may also find from the nature of the transactions that alterations, additions and improvements are implied in the terms of the lease. In Doe d. Dalton v. Jones (1832) 4 B. & Ad. 126, the lease of a private dwelling-house demised for 40 years contained a covenant to repair and keep in repair the demised premises, improvements and any additions made thereto with a proviso for re-entry in the case of a breach of the covenant. The lessee changed the lower windows into shop windows and stopped up a doorway making a new one in a different place in the internal partition of the house. It was held that no forfeiture was incurred because the lessee’s covenant being only against non-repair, and it being implied by the terms of the lease, that the additions and improvements were to be made.

Parke J. held at p. 128 that:

“It is said, that ‘if a lessee flings down a wall between a parlour and a chamber, by which he makes the parlour more large, it is waste, because it cannot be intended for the benefit of the lessor, nor is it in the power of the lessee to transpose the house’. That does not apply to a lease like this, which contemplates ‘improvements and additions’, and only provides against non-repair, which is permissive waste. Under such a lease, can it be said that a valuable house was to be kept in precisely the same condition for forty years? 1 think the non suit was right.”

Taunton J. supported the view of Parke J. and explained further at the same page:

“This case is the same as if there had been an express contract for the liberty to make improvements, which at common law, would have been waste: here the contract is implied. There is no stipulation against waste, except by the convenant to repair: . . . the effect of which was merely that the tenant should supply the ordinary wear and tear of the premises.”

The learned trial judge in the court below, however, in an answer to a question he asked himself, on what was the law on a covenant to repair, referred to the case of Rose v Hyman [1911] 2 K.B. 234, C.A. In that case, an uncompleted chapel and the piece of land on which it was being constructed were demised for a term of 99 years. The covenants contained in the lease were inter alia: that the lessees should complete building the chapel by a certain date and from time to time during the term to repair and keep the chapel and the walls, fences and other appurtenances pertaining thereto in good and substantial repair. The chapel was completed and used as a place of religious worship for 60 years. The lease was then sold with the consent of the

[p.146] of [1973] 2 GLR 1

Charity Commissioners and the premises were adapted for a theatre. For this purpose, some iron railings which separated the chapel from the street were removed, and a new door was opened in the west wall and there were some internal alterations. The vendor had neglected to comply with a notice to repair and the reversioner was entitled to possession subject to the question of relief against forfeiture. The court held (Buckley L.J. dissenting) that the alterations were breaches of the covenant to repair and were acts of waste which the court would restrain by injunction, and that relief ought not to be granted, except on the terms of the reinstatement of the premises in their former condition. Buckley L.J., however, was of opinion that a right, reasonably to alter and adapt, was to be implied in the lease.

On appeal, the House of Lords reversed the decision of the Court of Appeal, sub nom. Hyman v. Rose [1912] A.C. 623, H.L. The House of Lords held that, in view of the fact that the lease did not prohibit the contemplated user of the premises (that is, as a theatre), none of the alterations in the circumstances constituted breach of covenant or waste and that the relief should be granted without the terms of the reinstatement of the premises in their former condition. Earl Loreburn L.C. held at p. 631 that:

“I do not find anything in it (that is the lease) which requires that the building shall be used as a chapel; certain trades are forbidden, but there is nothing to prevent its user for any other trade. Nor is there anything to prohibit internal alterations suitable for such trade. Again, there is a covenant not to vary the front elevation, and a covenant for supporting, upholding, and maintaining. I do regard that covenant as prohibiting such alterations as those in question. It is said that there has been waste. I agree with Buckley L.J. that this is a question of degree.”

The House of Lords held that the removal of the iron railings was not a breach of covenant because it was not shown that they existed at the time of the lease. Earl Loreburn L.C. continued at p. 632:

“No harm is done to anyone and the reversion is in no way injured. The opening of a new door in the west wall stands upon the same footing . . . It is a question of fact whether such an act changes the nature of the thing demised, and regard must be had to the user of the demised premises which is permissible under the lease.”

The alterations complained of by the respondent herein as aforementioned were the removal of the internal walls constructed after the execution of the lease and in accordance with the terms of exhibit B clause (h). As clearly shown in the correspondence between the parties referred to earlier in this judgment, the respondent, up to a certain point of time, was not opposed in principle to the alterations being carried out. However, the respondent later changed his attitude. He was adamantly opposed to any alteration whatsoever, and refused to give his consent.

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A lessor, in considering whether to withhold his consent or not, is to act reasonably, not arbitrarily nor capriciously, but prudently in his own self-interest: see Lambert v. Woolworth (F.W.) & Co., Ltd. (No. 2) [1937] 3 All E.R. 195 at p. 196. The issue, whether or not, the respondent in withholding his consent acted reasonably and prudently in his own self-interest is a matter of fact to be decided from the evidence.

Under cross-examination, the respondent said:

“When the bank was my tenant they allowed me to overdraw my account… Since 1962, the bank has pressed me to reduce my overdraft. In November 1965, the bank sued me for ¢78,088.58 plus interest at seven and half per cent. They obtained judgment against me. I appealed to the Court of Appeal. My appeal was dismissed.”

As stated earlier on in this judgment, exhibit A10 dated 23 July 1962, was the first indication of a change for the worse in the cordial relations between the parties. In view of the evidence of the respondent that the appellants in 1962 “pressed” him to take steps to reduce his overdraft of ¢78,088.58 and that they later obtained judgment against him, I think it is reasonable to assume that the appellants’ demand for repayment of the overdraft was the cause of the “bad blood” introduced in the relations of the parties from 1962. As such, one cannot consider the respondent’s refusal to give his consent, as being “not arbitrary nor capricious.”

However, the appellants’ defence in the court below was, as correctly pointed out by the learned trial judge, that they did not make any structural alterations and that whatever was done to the building was improvements and repairs which have in no way affected the structure of the building. They have also denied that the said improvements and repairs, had to be carried out with the consent of the plaintiff and they denied that the plaintiff is entitled to the relief claimed by the writ.

Exhibit B the underlease is for a term of twenty years with an option for another term of twenty years. Exhibit B gave the appellants the right to assign, sublet or part with the possession of the demised premises or any part thereof, without the consent or permission of the sublessor. This means that the appellants may assign the premises to anyone and not necessarily someone in the business of banking. If the appellants assign the premises to say, for instance, a school, is the school to be expected to use the facilities made for the purpose of banking? Certainly not. The school will have to alter and adapt the premises to suit its purposes unless there is a covenant restricting user. In exhibit B there is no restriction as to user. In my opinion, this is a clear case in which the right of the tenant reasonably to alter and adapt must be implied from the terms of the lease.

The appellants, in my opinion, are free to make the alterations complained of as of right, in exactly the same way, as if the power to do so had been expressly granted by the lease. For these reasons, I cannot support the decision of the learned trial judge, and I hold

[p.148] of [1973] 2 GLR 1 that the appeal be allowed and the judgment of the court below set aside.

JUDGMENT OF ARCHER J.A.

I agree that this appeal should be allowed for two main reasons. First of all, although the court below correctly observed that the sublease between the parties contained no prohibitions as to user of the premises or prohibitions against alterations, yet the court below concluded that the sublease was very prohibitive and restrictive. Secondly, notwithstanding that the evidence before the trial court was clearly to the effect that the alterations had not affected the main structure of the building, the court below came to the conclusion that there had been structural alterations which had changed the nature of the premises.

It seems to me that this appeal depends upon a proper and true construction of the sublease between the parties so as to determine their rights and obligations. But where the sublease is silent on any controversy between the parties, then the common law must apply. The common law so far as the matters in controversy are concerned is stated with clarity and precision in Halsbury’s Laws of England (3rd ed.), Vol. 23 at p. 595, para. 1284 of which states:

“It is a breach of the covenant to repair if the tenant pulls down any part of the premises or makes alterations in them, unless he is expressly, or impliedly given power to do so by the lease.

In order to determine whether the pulling down or alteration constitutes a breach of the covenant, regard must be had in each case to the user of the premises which is permitted by the lease. It may be that the demised property may be used for a variety of purposes, for which without alteration and adaptation it is not suitable, in which case a right on the part of the tenant to adapt the premises for such user is to be inferred.

In each case it is a question of fact whether the alteration changes the nature of the demised property, and if it does do so, the tenant will be guilty of waste.”

The first question to be answered is whether there was any restrictive covenant as to the user of the premises? The answer is no. There is not a single clause in the sublease which stipulates that the appellant should use the premises partly for residential purposes and partly for banking. There is also no provision that the premises should be used only for a specified purpose. The object of a restrictive covenant is not only to preserve the property during the term of the lease but also to preserve the reversion. When one considers the whole agreement between the parties, it becomes obvious that the respondent had no intention whatsoever of restricting the appellants to any particular user of the premises. Indeed, there is an open licence to the appellants “to assign, sublet or part with the possession of the demised premises or part thereof without the consent or permission of the sublessor.” It follows

[p.149] of [1973] 2 GLR 1 that the respondent was not interested if the appellants assigned the whole of the promises to a third party irrespective of the condition and status of that third party or the use to which the premises would be put after the assignment. It seems to me that when a landlord presents his tenants with such a blank cheque, he cannot come to a court of law and complain that he did not give the tenants authority to fill in the blank spaces in the cheque. If the present respondent had intended to restrict the appellants as to their user of the premises, he would have said so in the agreement.

The second question is whether the tenancy agreement permits the appellants, expressly or impliedly, to carry out the alterations complained of by the respondent. The tenancy agreement does not expressly confer such a power. But considering the period of the sublease and the nature of the appellants’ business as bankers such a power must be implied or inferred. From the outset, the appellants requested the respondent to effect certain works on the premises to suit their business of banking. The headlease was granted in April 1948 for a period of 50 years, thus expiring at the end of March 1998, two years before the end of this century. When the headlease was assigned to the respondent in June 1948 he took the whole of the residue less the last day. Subsequently, he granted the appellants a subterm of twenty years from October 1952 with an option in favour of the appellants for a further term of twenty years. In effect, the respondent had indicated to the appellants that they could have the premises until September 1992. After having granted such a term, it seems unusual that the appellants should be expected to continue to run their business until 1992 with the banking office, counters, safes and strong room in the same position in the first floor as they used to be in 1952. With expanding business, they would be expected from time to time to make adaptations to suit their business. It seems to me therefore that at the inception of the tenancy agreement, the respondent appreciated the nature of the appellants’ business and it must be inferred that they had power to make alterations or improvements to suit their business.

The third question is whether the alterations have affected the main structure or nature of the premises. The plans tendered in evidence clearly demonstrate that when the tenancy was created, the respondent had built the main structure of the premises and therefore let the whole of the first floor to the appellants. When the respondent covenanted to construct residential premises for the appellants on the same floor, what he did was to partition a section of the first floor into living quarters. When the appellants also decided to convert the living quarters into additional banking premises, what they did was to remove the respondent’s divisions and to re-construct their own partitioning to suit their purposes. The evidence on record shows that these alterations have not affected the main structure or nature of the premises. If these alterations are removed, the first floor with its

[p.150] of [1973] 2 GLR 1 four external walls will stand unaffected. I am convinced that if this aspect of the matter had been considered, the court below would have dismissed the respondent’s claim.

The respondent appears to have relied mainly on some nineteenth century decided cases in which forfeiture was claimed because either one single doorway had been erected, or a wall had been pulled down. It seems to me that to some extent these nineteenth century judicial precedents should be relied on with caution. Each case must be viewed in the light of all relevant facts. It is unconvincing to argue that because in 1817 an English court of law held that the pulling down of a wall constituted a breach of a covenant to repair therefore in 1973, whenever any tenant pulls down a wall, he must necessarily be in breach of covenant to repair. The very fact that the titles of some of these cases begin with the fictitious name John Doe should remind us that these cases belong to a different age. We live in the twentieth century when steel, concrete and glass have become inseparable triplets in the construction of any massive building. Whether an alteration has affected the structure of a building must be viewed in the light of prevailing factors in the present age. I am convinced that if the decided case of Hyman v. Rose. [1912] A.C. 623, H.L. and the evidence on record had been considered very carefully, the court below would have come to the conclusion that there had been no breach of covenant to repair and that the respondent was not entitled to possession on the ground forfeiture.

JUDGMENT OF ANNAN J.A.

I agree that the appeal be allowed and for the reasons given in the judgments just read. I only make a few observations.

The plaintiff-respondent’s claim for possession of the demised premises was based on the ground of breach of covenant to repair the premises. There was no dispute on the evidence that the defendants-appellants, the lessees, had made certain alterations in the internal arrangements of the premises. There is also no dispute that these alterations were made in the teeth of opposition by the respondent, the landlord. The lease contained no covenants against alterations or for improvements and the specific covenant upon which the respondent founded his claim was one “to keep the interior of the demised premises . . . in good and tenantable repair and condition.” To succeed therefore in his claim the respondent had to establish breach of this covenant.

It seems clear to me that upon the evidence of the witness for the appellants, a qualified architect, whatever alterations were made did not affect the structure of the building, at any rate not permanently. I do not think it can be disputed that these alterations made for a better user of the premises for the purposes for which the premises were let, namely, user as bank premises. It is true that there was a change in the user of a part of the premises. That portion of the premises had been constructed for use as living quarters for staff of

[p.151] of [1973] 2 GLR 1 the bank. This was done at the request of the tenants. The alterations changed the user of this portion from living quarters to a commercial user as part of the banking area. That was the only change of user. It seems to me clear that the nature of the user of that portion was, upon the agreement, a matter of choice for the tenants. They could use it for residential or commercial purposes depending on the nature of their requirements. Again the residential user of that portion was clearly ancillary to the main user for which the premises were let.

Since the covenant relied on was one for repair, and having regard to the specific alterations admittedly made. I see no case of a breach made out, upon the principles of the common law so fully set out in the judgments read before me. I agree therefore that the appeal be allowed.

DECISION

Appeal allowed.

S. E. K.