National Maternity Hospital v McGouran

• Jurisdiction: Ireland
• Judge: Mr. Justice Morris
• Judgment Date: 01 January 1994
• Neutral Citation: 1994 WJSC-HC 1526
• Docket Number: No. 5757P/1993
• Court: High Court
• Date: 01 January 1994

NATIONAL MATERNITY HOSPITAL v. MCGOURAN

BETWEEN

THE GOVERNORS OF THE NATIONAL MATERNITY HOSPITAL DUBLIN

PLAINTIFF

AND

ANN McGOURAN

DEFENDANT

1994 WJSC-HC 1526

No. 5757P/1993

THE HIGH COURT

Synopsis:

LANDLORD AND TENANT

Licence

Termination - Hospital - Shop - Occupier - Rights - Lease or licence - Agreement containing terms appropriate for lease - Right of licensor to possession - (1993/5757 P - Morris J. - 3/11/93)

|Governors of National Maternity Hospital Dublin v. McGouran|

LICENCE

Occupation

Termination - Contract - Effect - Dispute - Hospital - Shop - Lease or licence - Intention of parties - (1993/5757 P - Morris J. - 3/11/93)

|Governors of National Maternity Hospital Dublin v. McGouran|

Citations:

LANDLORD & TENANT (AMDT) ACT 1980

IRISH SHELL & BP LTD V JOHN COSTELLO LTD 1981 ILRM 66

SHELL MEX V MANCHESTER GARAGES 1971 1 WLR 612

ADDISCOMBE GARDEN ESTATES LTD V CRABBE 1957 2 AER 205

GRATIEN MOTOR CO V CONTINENTAL OIL 1979 IR 406

1 Judgment of Mr. Justice Morris delivered the3rd day of November 1993.

2 The issues which arise in this case are as follows:

3 The Plaintiffs (hereinafter referred to as the "hospital") contend that the agreements which they entered into with the Defendant (Mrs. McGouran) [and in one case her husband] constituted no more than a licence to use certain parts of the hospital premises as a hospital shop and as a coffee shop. Mrs. McGouran contends, on the contrary, that in the circumstances in which she became entitled to run these business ventures, she was granted or acquired a leasehold interest or a tenancy in the area which she occupied.

4 A secondary point arises, and it is this:- In the event of the Court determining that all that Mrs. McGouran got was a licence, is the hospital entitled to immediate possession of the premises or alternatively, as contended for by Mrs. McGouran she is entitled to a year's notice of the determination of the licence so as to enable her to remove her equipment from the premises and possibly make other arrangements?

5 Insofar as the determination of these issues is concerned I propose to deal with the case on the basis that while Mr. McGouran was a party to one of the two agreements executed on the 9th of August 1989, being that relating to the hospital shop, his interest merged with Mrs. McGouran and that it is she who effectively is to be treated as either the licensee or the tenant of the premises. I do that on the basis that whereas Mr. McGouran's possible interest was referred to during the course of the hearing no point was made that the proceedings were improperly constituted naming only Mrs. McGouran as Defendant, and the Defences were put forward only on Mrs. McGouran's behalf

6 The relevant facts insofar as this action is concerned I find to be as follows:

7 Prior to May 1989 the hospital provided for the requirements of the patients in the hospital by authorising a Mr. and Mrs. Healy to operate a Trolly Shop within the hospital. In May of 1989 they gave up this enterprise and the hospital, in the person of Mr. Dunleavey, the then Secretary Manager of the hospital, approached Mrs. McGouran who ran a shop near to the hospital and inquired if she would be interested in running a shop in the hospital premises. The hospital considered that the Trolly Shop was not entirely satisfactory and proposed to convert the old housekeeper's office into a shop. Mrs. McGouran was interested in the project. I am satisfied that at times during these discussions, references were made to the "rent" which would be required for the occupation of the premises for the running of the shop and I am also satisfied that references were made to the "lease" or "tenancy" which Mrs. McGouran would obtain. These words arose both in the course of discussions between the hospital authorities and Mrs. McGouran and also were used in the course of correspondence. They were, in particular, used when Mr. Dunleavey contacted the hospital Solicitors instructing them to "prepare a lease for the proposed tenant". The hospital Solicitors immediately identified and advised Mr. Dunleavey of the dangers which the granting of a lease would create and warned them that such a step might give rise to Landlord and Tenant Act rights in favour of any such lessee, however, in accordance with their instructions they forwarded to the hospital draft leases.

8 On the 16th of June 1986 they also forwarded a caretaker's agreement to the hospital for signing by Mr. and Mrs. McGouran with a view to holding the position and this caretaker's agreement was signed by Mr. and Mrs. McGouran on the 1st of June 1986 prior to that date they had commenced trading.

9 The shop was extremely successful.

10 The hospital found itself in a position where the "old nursery" became available and it considered that this was a more appropriate location for the shop. At the same time it proposed opening a coffee shop in the hospital. It invited Mrs. McGouran, among others, to tender for the franchise to run the coffee shop and she did so on the 8th of September 1988. She was successful and she opened the coffee shop on the 4th of November 1988. At about this time the position of the hospital shop was transferred to a new location.

11 Again I am satisfied that during the discussions between the hospital and Mrs. McGouran, relating to the coffee shop, references were made to "rent" and also to the proposed "lease" which she would get for the coffee shop. I am satisfied that again the hospital Solicitors, when informed of the proposal to grant a lease, they warned the hospital against doing so on the grounds that it might give the lessee rights under the Landlord and Tenant Act unless care was taken to ensure that the lease did not continue beyond two years and nine months, however again in compliance with instructions draft leases were sent to the hospital. These were not signed.

12 At about this time Mr. Dunleavey was replaced as Secretary Manager of the hospital by Mr. Pat Cannavan and one of the matters requiring the attention of Mr. Cannavan on taking office was the position relating to the occupancy of the coffee shop and the hospital shop by Mrs. McGouran. Both of these businesses were operating and arrangements were made for the hospital Solicitor, Mr. Timothy Crowley to attend at the hospital for the purpose of discussing this matter and Mr. Crowley attended at the meeting bringing with him draft licences which he felt were appropriate. Mrs. McGouran was requested to and did attend that meeting and I accept the evidence of Mr. Crowley that at that meeting he explained in detail to Mrs. McGouran the fact that the hospital would not be prepared to grant Mrs. McGouran a lease and in addition explained to Mrs. McGouran the reasons why they would not grant a lease but would only grant her a licence. I accept also as a fact that Mr. Crowley gave her the draft licences for execution but suggested to Mrs. McGouran that she should consult her Solicitor. I am also satisfied that Mrs. McGouran did contact her Solicitor and brought with her the drafts of the licences which Mr. Crowley had given her. While it may well be that Mrs. McGouran was confused by the situation as explained to her by Mr. Crowley I am satisfied that she is a business-like person and I am satisfied that she got legal advice in relation to this matter.

13 The licences not having been returned executed, a reminder was sent to Mrs. McGouran and the licences were duly executed by the parties and dated the 9th of August 1989. The licence in respect of the coffee shop was granted to Mrs. McGouran only and under the terms of this licence a licence fee of £5,000 per annum was payable and the licence was to run for a period of one year from the 31st of December 1988. In the case of the shop the licence was granted to both Mr. and Mrs McGouran...