By Nicholas Kissen, Senior legal advisor
December 2015
The Court of Appeal has recently handed down judgment in the case of Jewelcraft Limited v Pressland and decided that a flat above a shop was a house within the meaning of the Leasehold Reform Act 1967 (the Act).
Section 2(1) of the Act defines a house as including any building designed or adapted for living in and reasonably so called, notwithstanding that the building is not structurally detached, or was or is not solely designed or adapted for living in, or is divided horizontally into flats or maisonettes; and
- where a building is divided horizontally, the flats or other units into which it is so divided are not separate “houses”, though the building as a whole may be; and
- where a building is divided vertically the building as a whole is not a “house” though any of the units into which it is divided may be.
Built in the 1920s as a ground floor purpose built shop with living accommodation above, the shop was not originally self-contained. The building was let on a 99-year lease granted in 1923 which contained no user restrictions. An internal staircase was removed in or about 1970 and an external staircase built leading to a self-contained first floor flat.
In 2010, the tenant claimed the freehold under the 1967 Act. The landlords disputed the claim, saying the building was not a house.
The Court of Appeal decided that the question of whether a particular property is a house within the meaning of s2 is a question of law. In other words it is not purely a factual issue for the court.
The court found that it was reasonable to call a building comprising a shop with residential accommodation above a house, even if in ordinary speech it would best be described as a shop, and even if the residential accommodation is not linked internally to the remainder of the building.
The Court said that, in the future, neither the external appearance nor the internal layout of a building ought to make a difference in deciding whether a building is a house should it be the sort of building which, as a matter of policy, Parliament intended to fall within the 1967 Act.
