Summary

Appeal by landlord against decision that allowing nuisance to continue on demised premises was a derogation of grant towards another tenant.

Facts

The appellants were developers of a site on Bognor Regis High Street. The respondent was the father of a business woman who opened a shop selling executive toys. The development was for a mall of shops. The appellants were the first to take a tenancy and occupied before the development was complete. The respondents relied on a brochure from the appellants which stated that a letting policy existed to the effect of only letting to "high class retail outlets". At first instance this was found to be a misrepresentation as a charity shop opened in the mall. The shops experienced trading and financial difficulties and two quickly closed. The appellants disclaimed the lease after writing to the developers to complain that the units surrounding them were empty and the rent sought for them was so low that it could only attract a lower class of business. The last straw was the letting of an empty unit to a pawnbroker and the siting of plastic coffee tables outside the toy shop. The developers appealed against the judge's decision that they had misrepresented the site and had allowed a nuisance to carry on in the form of the pawnbrokers business.

Held

(1) It was plain from the surrounding circumstances that the manner in which tenants carried on their business and their user of the common parts could have a great influence on the business of the other tenants, and on the success of the development itself. (2) Where the mere fact of letting neighbouring land which had been retained by the landlord was not a derogation from his grant to the original tenant, then the landlord will only be vicariously liable for the activities of his tenant on the land where he has consented to them. (3) Nuisances caused or continued by the landlord which interfere with the enjoyment of the demised land will usually also be conduct which renders the demised land unfit or materially less fit for the purpose for which the demise was made, and so constitute a derogation from grant. (4) In order to succeed the tenant must show that the landlord must have a duty to act. There must come a time when the landlord becomes legally obliged to protect that which he has granted to his tenant. The leasing of the adjoining premises to the pawnbroker was a substantial interference with the business of the respondent.

The appeal was dismissed.