Temple Bar Properties Ltd & Cirillo & Romeri v Kavanagh

• Jurisdiction: Ireland
• Judge: Mr. Justice Kearns
• Judgment Date: 05 September 2001
• Neutral Citation: [2001] IEHC 129
• Docket Number: 8492 P./1995
• Court: High Court
• Date: 05 September 2001

[2001] IEHC 129

The High Court

8492 P./1995

TEMPLE BAR PROPERTIES LTD & CIRILLO & ROMERI v. KAVANAGH

Between

TEMPLE BAR PROPERTIES LIMITED

AND

BY ORDER EMILIO CIRILLO AND GRAZIANO ROMERI

PLAINTIFFS

AND

ARTHUR KAVANAGH

DEFENDANT

Citations:

LANDLORD & TENANT (IRL) ACT 1860 (DEASYS ACT) S3

GATIEN MOTOR COMPANY LTD V CONTINENTAL OIL CO LTD 1979 IR 406

IRISH SHELL V COSTELLO 1984 IR 511

KEANE EQUITY & THE LAW OF TRUSTS IN THE REPUBLIC OF IRELAND PARA 7.04

LANDLORD & TENANT (AMDT) ACT 1980 S20

CHAMBERS V FAHY 1931 IR 17

Synopsis:

LANDLORD AND TENANT

Tenancy

Estoppel - Property - Trusts -Whether tenancy created - Whether defendant had exclusive possession of premises - Whether requirements of valid trust had been met - Landlord and Tenant (Ireland) Act, 1860 (Deasy's Act) - Landlord and Tenant (Amendment) Act, 1980 (1995/8492P - Kearns J - 5/9/01)

Temple Bar Properties v Kavanagh

A dispute arose between the plaintiffs as owners of a premises in the Temple Bar area of Dublin and the defendant who had occupied the premises for a number of years and had an artist’s studio there. Evidence was given that the defendant collected the rent from other artists who also had studios in the premises and paid this over to the owners. Together the artists had called themselves the ‘Atelier Group’. Evidence was also given that the defendant discharged the electricity bills and maintained the premises. In effect the question for determination was whether the defendant was entitled to see himself as a landlord of the premises in respect of the other occupants or as such was he merely the spokesman acting on behalf of the ‘Atelier’ artists. Mr. Justice Kearns was satisfied that the defendant had laboured under a misconception as to his real position. His actual status was that of spokesman for the other occupants in the building. The plaintiffs had however failed to regulate the legal arrangements in a more clearly defined way. An issue of estoppel could not be said to have arisen given that a tenancy could not arise by stealth or by accident. It was never intended that the entire premises be demised to the defendant in a personal capacity. The arrangement could be seen as forming the basis of a valid trust with the defendant acting on behalf of the trust. The court would hold in favour of the plaintiffs in respect of the primary issue.

Judgment of

Mr. Justice Kearns

1 delivered the 5th day of September, 2001 .

2 The first named Plaintiffs were at all material times the owners of premises at 27, Temple Lane South, otherwise known as 53, Dame Street in the city of Dublin. The first named Plaintiffs purchased these premises from CIE in July 1991. The premises in question incorporate Nico's restaurant on the ground floor the proprietors of which are the second and third named Plaintiffs, who purchased the entire premises from Temple Bar Properties in 1997, subject to certain covenants with regard to the occupancy of the upstairs premises by various individuals as artists studios.

3 Going back to 1986, individual studios on the first fourth floors of 53 Dame Street were made available to various artists (who styled themselves the "Atelier Group") by way of temporary letting agreement from month to month from the 8th day of October, 1986, which said agreement was not intended to exceed a period of two years.

4 The artists and group had as its initial co-ordinator or representative a Mr. John Brobbel and the Defendant was one of the first artists to occupy a studio, being one on the first floor. With the passage of time, and without objection from the owners of the property, the Defendant's occupation extended, it has been agreed herein, to three rooms.

5 Rather than deal with all the artists individually, CIE and Mr. Brobbel agreed that the group would for convenience purposes form themselves into a co-operative of an informal nature. The idea was that the artists would pay their monthly rent into an Atelier account in the Bank of Ireland in Baggot Street, into and from which the landlords rent could be paid by direct debit. However, within a short space of time, it became apparent to Mr. Brobbel that problems were going to arise, because only two of the artists signed up to direct debits themselves and, as he told the Court, "I could see problems coming". He pulled out in 1988, and in November of that year a further caretakers agreement was drawn up whereby the various artists, including the Defendant, undertook individually to pay all "rates, taxes and other outgoings due and payable in respect of the said occupied premises as and from November 1, 1988. " The Defendant took over Mr. Brobbel's role and made himself responsible for collecting and transmitting the monies payable by the artists to CIE.

6 A new monthly lease was drawn up in November, 1989 between CIE and the Defendant alone for the monthly letting for £300 of the premises by way of temporary convenience. This agreement expressly acknowledged that at that particular time CIE were considering plans for the development of these and other premises as a bus and rail terminal.

7 At a certain point in time, the Defendant moved into residential occupation of one of the studios which gave rise to certain concerns in CIE, culminating in a request for an undertaking and acknowledgement in writing dated 30th March, 1990, furnished and signed by the Defendant which is expressed in the following terms:-

8 "I, Arthur Kavanagh, Administrator of "Co-operative Atelier", 27 Temple Lane, hereby state that the premises are not being used for residential or commercial purposes by the undersigned tenants.".

9 This document was also signed at the time by all the other artists comprised in the Atelier co-operative.

10 When CIE's development plans for the area ended, a notice to quit was served by CIE on Mr. Kavanagh as a sale of the property to the first named Plaintiffs was then in prospect. However, no action was taken on foot of such Notice to Quit, the same being served purely to resolve any title difficulties, it always being the intention, both of CIE and Temple Bar properties, to preserve this building and others in the nearby area for the use and occupation of artists on favourable financial terms. It is clear that from the outset in this matter ordinary business criteria were not applied to the dealings between either CIE and the artists concerned, nor indeed by the first named Plaintiff to this group from 1991 onwards.. Mr. Kavanagh was largely left to his own devices on a day by day basis. It was he who dealt with both CIE and Temple Bar on behalf of the other occupants. It was he who determined who should gain access to any studio which might become vacant in the premises. It was he who was responsible for collecting in and paying over occupants, monies; he also paid the electricity and took care of the maintenance and good order of the premises. He received no remuneration for this work, either from CIE or Temple Bar, nor from the other occupants of the studios. The only suggested benefit, from Mr. Kavanagh's point of view, from these arrangements was the fact that over a period of time he became the occupier of three studios at a knockdown rent. He ran art classes in one studio. He was also permitted to use one studio as a residence despite the undertaking of March, 1990.

11 In July 1991, the purchase by Temple Bar went through. Thereafter on the 23rd of September, 1991 the Defendant wrote to Mr. Quillinan who was then the property executive in Temple Bar dealing with the premises. In his letter, Mr. Kavanagh applied for permission for the arrangements concerning the occupants of 53 Dame Street to continue. He asked in his letter, expressed to be on behalf of the Atelier group, for permission to continue to "administrate, and also to continue as studying artists in 27 Temple Lane". Mr. Kavanagh also had some meetings around that time with Mr. Hickey, who was then property director of Temple Bar, and who was anxious to reassure the artists that their continued occupation of their studios was secure.

12 These exchanges translated into a number of agreements which were drawn up in December 1991. It is perhaps important to stress that prior to that date, Mr. Quillinan advised the Court that he called to Mr. Kavanagh at 53 Dame Street with these (as yet unexecuted) written agreements and got from him a list of the then occupants of the various studios, so that the identity of the various occupants was not merely ascertainable, but was actually known by reference to individual names as of October 1991. Mr. Quillinan in evidence produced his handwritten contemporaneous note, the accuracy of which was not challenged by Mr. Kavanagh.

13 The first of these written agreements is an agreement to grant a lease in the future in the form of a draft annexed to the agreement. This agreement, dated the 9th of December 1991, was made between Temple Bar Properties Limited of the one part and "Arthur Kavanagh In trust for Atelier artists" of the other part. The agreement recognised that the tenant had lately held the premises specified in the schedule (and therein described as the upper floors of 27 Temple Lane South) and it was acknowledged by Mr. Kavanagh that any previously existing tenancy had been validly terminated by CIE by a Notice to Quit dated 21st December, 1990.

14 The agreement went on to recite the purposes for which Temple Bar Properties had been formed and recited that it was intended to develop this and premises in the Temple Bar area in accordance with the objectives of the Temple Bar Area Renewal and Development Act. As part of this plan, Temple Bar expressed its intention to offer some properties within the Temple Bar areas to existing lessees by way of lease for various terms of years. It further recited that Temple Bar Properties would permit the tenant to remain in the premises on foot...