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	England and Wales Court of Appeal (Civil Division) Decisions
You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> John Lyons Charity v Shalson [2001] EWCA Civ 1451 (19 July 2001) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2001/1451.html Cite as: [2001] EWCA Civ 1451

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IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE LANDS TRIBUNAL

		Royal Courts of Justice Strand London WC2 Thursday, 19th July 2001

Thursday, 19th July 2001

1. LORD JUSTICE SCHIEMANN: This is an application for permission to appeal from the Lands Tribunal, and is concerned with the proper construction of section 9(1A)(d) of the Leasehold Reform Act 1967. The section reads so far so relevant as follows:

   "The price payable for a house and premises shall be the amount at which at the time when the tenant gives notice of his desire to have a freehold the house and the premises, if sold, might be expected to realise, on the assumption that the price be diminished by the extent to which the value of the house and premises has been increased by any improvement carried out by the tenant or his predecessors in title at their own expense."

2. We are dealing here with a house which was first converted into flats and later reconverted into a house. This reconversion added to the value of the house. The tenant argue that this reconversion is properly described as an improvement, and he argues that if that is so then the price payable for the house should be diminished by the extent of that increase.
3. The tribunal thought that the proper approach was as follows. First, establish the value of the house at the valuation date on the assumption that it was in the condition in which it had originally been let. I might describe this as the "original condition value." Second, establish the value of the house as it was on the valuation date, which one can call "the present condition value." Third, if, but only if, the present condition value exceeded the original condition value go on to determine whether any or all of that excess was attributable to improvements carried out by the tenant or his predecessors in title at their own expense. Four, if that was the case then subtract the relevant part of the excess from the present condition value in order to arrive at a purchase price.
4. The tenant by contrast submits that the proper approach should be simpler. First, establish the present condition value; second, establish whether any or all of the present condition value is attributable to improvements carried out by the tenant or his predecessors in title at their own expense; and three, if that was the case then subtract that figure from the present condition value.
5. The point raised is undoubtedly one of very general importance which will affect many valuations. We are told there is no authority on it. In my judgment the statute itself provides no clear answer to which of these approaches is correct.
6. I would therefore give permission to appeal.
7. LORD JUSTICE MANCE: Since Schiemann LJ considers that permission should be given I also consider that there should be an appeal.
(Application granted; costs to be costs in the appeal).