Collective enfranchisement- the Hosebay saga

I did not study collective enfranchisement on the LPC. I understand that the area is something of a speciality (perhaps even an acquired taste) for some property Lawyers. Nevertheless, the Supreme Court's decision in the case of Day v Hosebay (Hosebay), has caught my interest. Hosebay is a 2012 case.

The case concerns the right of Tenants to acquire the Freehold interest in their properties under the Leasehold Reform Act (the Act) 1967. The Tenant must certify certain criteria under the Act. In Hosebay, the court's decision focused on whether the property satisfied the definition of a House under s2 (1) of the Act. That is, whether it was a building 'designed or adapted for living in and reasonably so called.'

This case concerned three properties in Kensington. The properties were originally residential homes but were being used, at the time of the case, to provide holiday accommodation. The case reached the Supreme Court. It was held that the properties were in 100% commercial use. The Tenants did not satisfy s2 (1) of the Act (as above) and could not acquire the Freehold interest in their properties. It was necessary to look at the current nature of the property and whether or not it could be classified as a home and not just a house. The properties did not meet the definition of a 'house' under the Act. The Tenant's enfranchisement claim failed.

What does this mean for Landlords and Tenants? If the property is currently being used, for commercial purposes, any enfranchisement claim will fail.

However, the court did not address the definition of 'commercial use.' No doubt, there will be further cases involving mixed use property. The jury's out as to whether mixed use property will satisfy the provisions of the Act for a successful enfranchisement claim.

No doubt, there will continue to be a string of cases in this interesting area of law. It's funny how words seem to matter a great deal in law...

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