Shell-Mex v Manchester Garages: CA 1971

The defendant was allowed to go into occupation of the plaintiff’s premises solely for the purpose of selling the plaintiff’s brands of petrol and the defendants undertook to use every endeavour and due diligence to sell and foster the sale of the plaintiff’s products. The plaintiffs also were entitled to considerable rights of access to the premises for the duration of the agreement. The claimant said that no tenancy had been granted.
Held: The Rent Acts must not be allowed to alter or influence the construction of an agreement. If the consequence in law of a transaction is the avoidance of the application of the Rent Acts, then that is not a ground on which the transaction can be flawed.
Buckley LJ said: ‘It may be that this is a device which has been adopted by the plaintiff company to avoid possible consequences of the Landlord and Tenant Act 1954, which would have affected a transaction being one of landlord and tenant; but, in my judgment, one cannot take that into account in the process of construing such a document to find out what the true nature of the transaction is. One has first to find out what is the true nature of the transaction and then see how the Act operates upon that state of affairs, if it bites at all. One should not approach the problem with a tendency to attempt to find a tenancy because unless there is a tenancy the case will escape the effects of the statute.’
Denning LJ said: ‘Broadly speaking, we have to see whether it is a personal privilege given to a person (in which case it is a licence), or whether it grants an interest in land (in which case it is a tenancy). At one time it used to be thought that exclusive possession was a decisive factor. But that is not so. It depends on broader considerations altogether. Primarily on whether it is personal in its nature or not.’


Buckley LJ, Denning LJ


[1971] 1 WLR 612


England and Wales

Cited by:

CitedCrancour Ltd v Da Silvaesa and Another CA 26-Feb-1986
The plaintiff sought possession of two rooms in a house occupied by the defendants separately. The agreements stated that they were licences. The agreements excluded the occupiers between 10:30am and noon on each day. The occupiers claimed to be . .
CitedBinions v Evans CA 27-Jan-1972
The plaintiffs had bought a cottage subjecty to a tenancy to the defendant. They sought possession saying that she held under a tenancy at will. It was a renancy for her life but described as a tenancy at will. The judge had held that the other . .
Lists of cited by and citing cases may be incomplete.

Landlord and Tenant

Updated: 31 July 2022; Ref: scu.259541