McGowan v Harrison

• Jurisdiction: Ireland
• Judgment Date: 01 January 1941
• Date: 01 January 1941
• Court: Supreme Court

McGowan v. Harrison.

JAMES McGOWAN

Plaintiff

and

WILLIAM J. HARRISON

Defendant.

Supreme Court.

Contract - Implied condition - Alleged breach - Sale of house - Sale by way of underlease - Whether "a contract for letting for habitation of a dwelling-house" - Whether implied statutory condition as to fitness of house for habitation applicable - House not reasonably fit for habitation - Warranty as to condition - Housing (Miscellaneous Provisions) Act,1931 (No. 50 of 1931), s. 31, sub-s. 1 - Small Dwellings Acquisition Act,1899 (62 & 63 Vict. c. 44), ss. 1 and 10.

By lease, dated 16th day of May, 1933, the defendant, a building contractor, in consideration of the payment of £775, demised a newly erected house to the plaintiff for a term of 500 years from 29th September, 1925, subject to a yearly rent of £8. The plaintiff occupied the house from the date of the lease until the end of 1937, when, owing to the foundations subsiding and the cracking of the walls, he could no longer live there. The plaintiff then instituted an action for damages for breach of contract on the grounds:—(1), that by virtue of s. 31, sub-s. 1, of the Housing (Miscellaneous Provisions) Act, 1931, there was implied a condition in the contract that the house was, at the commencement of the tenancy, and an undertaking that it would be kept by the defendant during the tenancy, reasonably fit for human habitation; and, in the alternative, (2), that, as the house was, to the knowledge of the defendant, required by the plaintiff for his immediate habitation there was an implied warranty that it was reasonably fit for that purpose.

Held by the Supreme Court, affirming Maguire P., that the fact that the sale of the house to the plaintiff was carried out by means of an underlease, did not suffice to establish that he was a tenant holding under "a contract for letting for habitation of a dwelling-house" within the meaning of s. 31, sub-s. 1, of the Housing (Miscellaneous Provisions) Act, 1931, and therefore the condition and undertaking implied in that sub-section, as to the house being reasonably fit for human habitation, did not apply.

Held further, by Maguire P. (as to which the plaintiff did not appeal), that there was no implied warranty on the part of the defendant that the house was fit for habitation.

Accordingly the plaintiff's action was unsustainable.

Otto v. Bolton and Norris, [1936] 2 K. B. 46, followed.

Witness Action.

The facts have been summarised in the headnote and are sufficiently stated for the purpose of this report in the judgment of Maguire P.

The plaintiff appealed to the Supreme Court (1).

Maguire P. :—

In this action the plaintiff seeks damages for breach of contract, made between himself and the defendant.

The contract is described as a contract for the sale of the house and premises now known as No. 42 Orwell Road, in the City of Dublin. Damages are also claimed in respect of the defective quality of the house, and for breach of warranty.

The material facts appear to be that the defendant, in 1932, for the purpose of creating ground rents, bought certain lands at Orwell Road. He got an assignment of the lands by way of sub-lease for a term of 500 years from 1925. On this plot he proceeded to have a number of houses erected.

About the year 1932 the plaintiff learned that there were houses for disposal at Orwell Road. He appears to have learned this through the firm of Mr. McArthur. The correspondence with Mr. McArthur was not put in, but it appears that he wrote to Mr. McArthur saying that he had seen his advertisement about houses for sale at Orwell Road in the newspapers. Through Mr. McArthur he put himself in contact with the defendant.

On the 10th August, 1932, the defendant, Harrison, wrote to the plaintiff:—"Your letter of the 9th instant has been forwarded to me by Mr. McArthur. The price of the house on Orwell Road is £750, the head rent is £8 and the lease is for 500 years. There is the usual partial remission of rates for 20 years. The Civil Service Building Society will lend £500 (this is the maximum amount that under their rules they can lend on a £750 house). Your letter refers to a deposit of £100, perhaps you could increase that sum, if not, how do you propose to pay the remaining £150?"

Thus the plaintiff and defendant were brought into relationship. On the 12th August the plaintiff wrote in reply:—

"Your letter to hand of the 10th instant. Re your new houses on Orwell Road, Rathgar, I wrote to MacArthur in answer to the advertisement in the evening papers that

£100 down secures new house off Rathgar Road. I will explain my position and you may be able to make some suggestions for me. I would be able to put down £100, but would only be able to pay £1 per week after that. However, if things were good with me I would be able to lessen my debt with £10 or £15 now and then. However, now that I have explained my strength, I would ask you for any suggestions you can make, as you know more about the building societies than I do. I might mention that the new houses in Orwell Road would suit myself and family, as they are the most compact little houses I have seen in Dublin. Kindly let me know full particulars about the Civil Service Building Society or Insurance Societies. You say the Civil Service Society would advance me £500. In what way and what interest would I have to pay on £500? And how long would I have to pay off same? I would be glad to hear from you as soon as possible as I am at present in a flat and want to get out as soon as I can."

The house in which the plaintiff was first interested was not the one which he subsequently acquired. While looking at houses on the site of the building scheme his attention was directed towards the house which is the subject of this action. It appears from the evidence and correspondence that when he decided to acquire this house it was complete. The parties came to terms which took shape in the agreement of 27th January, 1933, which reads as follows:—

"I propose and agree to take from you a sub-lease of the house and premises intended to be known as No. 49 Orwell Road, Rathgar, Dublin, for the term of 450 years at a yearly rent of £8 and to pay you therefor the sum of £775 of which the sum of £150 is deposited herewith and the balance is to be paid on the 28th day of February, 1933, on which date the lease is to be completed and clear possession of the premises given to me, you discharging all outgoings (if any) to the same date. If from any cause the balance of the money should not be paid on the date stipulated I agree to pay you interest thereon at the rate of 6 per cent. per annum until the actual date of payment, but this stipulation is without prejudice to your remedy to forfeit the deposit owing to my default in completing the transaction on the date mentioned. The lease shall contain similar covenants and conditions, including the covenant restricting the use of the premises to that of a private dwelling house, and to insure, contained in the sub-lease under which you hold the premises with others.'"

The plaintiff was anxious to go into possession and accordingly he was allowed in under a caretaker's agreement. The sale was completed by a deed of the 16th May, 1933. The land being registered land, the deed was in the form of an indenture suitable to such premises. There are three parties to the deed, the defendant, described as lessor, the...