Court of Appeal

Published July 13, 2007

Contour Homes Ltd v Rowen

Before Lord Justice Pill, Lady Justice Arden and Lord Justice Lawrence Collins

Judgment June 26, 2007

Where an assured tenancy agreement contained a clause providing the machinery for the increase of the rent, the landlord was not required to comply with the rent review procedure set out by section 13 of the Housing Act 1988.

The Court of Appeal so held when allowing the appeal of the landlord, Contour Homes Ltd, against the dismissal by Mr Justice Irwin, sitting in the Manchester District Registry of the High Court on October 4, 2006, of its appeal against the finding of the Northern Rent Assessment Panel that its letter of February 27, 2006 to the tenant, Gary Rowen, initiating a review of the rent payable under his assured tenancy was invalid as it did not comply with section 13(2) of the 1988 Act.

Mr Jonathan Seitler, QC, for the landlord; the tenant did not appear and was not represented.

LADY JUSTICE ARDEN said that the judge had held that the landlord’s letter should have been in the form prescribed by section 13(2).

The landlord submitted that section 13 did not apply, since the tenancy agreement contained its own rent review clause, and so was excluded by section 13(1)(b) as an assured periodic tenancy “in relation to which there is a provision, for the time being binding on the tenant, under which the rent for a particular period of the tenancy will or may be greater than the rent for an earlier period”.

On their face, those words were apt to exclude: (i) a term providing for a specified increase in rent; (ii) a term providing the machinery for the increase of rent.

In her Ladyship’s judgment, both were included within section 13(1)(b) because of the words “will or may be”. There was nothing in section 13(1)(b) limiting it to clauses which provided for an increase of a fixed amount as opposed to clauses providing for an increase of unspecified amounts to be arrived at in a specified way.

The judge had therefore been wrong to limit section 13(1)(b) to fixed amount rent review clauses.

Lord Justice Lawrence Collins and Lord Justice Pill delivered concurring judgments.

Solicitors: Trowers & Hamlins, Manchester.

Times Recommends

• Linklaters trounces rivals as UK's biggest firm
• Clifford Chance profits plunge 37 per cent
• Casual drinkers hit by spread of 'dry' zones