The Mortgage Corporation Ltd v Ubah: CA 21 Mar 1996

The respondent mortgagee had obtained an order for possession against the mortgagor freeholder, referred to in the judgment as ‘the Chief’, who had, prior to the mortgage, granted a tenancy to the appellant.
Held: The landlord’s retention of a right to use the kitchen made the tenancy a restricted tenancy even though no use was possible by the landlord under the contract in that situation.
CS Millett LJ: ‘The appellant’s evidence was that in 1987, that is before the mortgage was granted to the respondents, the appellant arranged for work to be carried out on the flat. The Chief later agreed with him that he would pay andpound;13,873 towards the cost of those repairs and in the words of the appellant ‘the Chief told me to set my rent against what he owed me’. That agreement was effective between the parties, but it did not confirm upon the appellant an interest in land capable of binding successors in title to the Chief whether with or without notice of the arrangements unless the right the right of deduction which was given to the appellant fell within one of the two established rights of deduction which are capable of binding successors in title’. And
‘As against the Chief in my opinion the appellant may well be entitled to deduct the amount which the Chief owes him from payments of rent which are due to the Chief. But the money judgment below is entirely in respect of rent to due the respondents after the date that they had notified the appellant that they had taken possession. The appellant has no right of set-off capable of binding successors in title such as the respondents. It is, of course, settled law that an interest which is not capable of binding successors in title cannot be an over-riding interest within section 70(1)(g) of the Land Registration Act 1925.’
Millett LJ
Gazette 03-Apr-1996, Times 21-Mar-1996, [1996] 73 P and CR at 500
Rent Act 1977 21
England and Wales
Citing:
CitedBritish Anzani (Felixstowe) Ltd v International Marine Management (UK) Ltd ChD 19-Dec-1978
Money expended by a tenant on discharging his landlord’s covenants will in appropriate circumstances operate as a partial or a complete discharge so as to furnish a defence at law to a claim for unpaid rent; and where the tenant has suffered damage . .
CitedLee-Parker v Izzett (1) ChD 1971
Money expended by a tenant on discharging his landlord’s covenants will in appropriate circumstances operate as a partial or a complete discharge so as to furnish a defence of set-off at law to a claim for unpaid rent. Justice Goff discussed the . .

Cited by:
CitedEdlington Properties Limited v J H Fenner and Co Limited CA 22-Mar-2006
The landlord had assigned the reversion of the lease. There was an outstanding dispute with the tenant defendant who owed arrears of rent, but sought to set these off against a claim for damages for the landlord’s failure to construct the factory in . .

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Updated: 10 April 2021; Ref: scu.89837