In 1937, the tenant (High Trees House Ltd) took the lease of High Trees House, a block of flats in Clapham, for 99 years. The ground rent was £2,500 per annum. The tenants found it difficult to let the individual flats due to the outbreak of war. In 1940, the landlord (Central London Property Trust) agreed in writing to reduce the ground rent to £1,250 per annum. By early 1945 the tenant's position had improved and the whole block was occupied. In September 1945 the landlord wrote again to the tenant asking that they start paying full rent again. They brought a claim in the High Court to recover the post 1945 ground rent at the higher rate.
Where is it on the map?
At point H.
Who won?
Giving judgment, Denning J (later to become Lord Denning) held that the circumstances under which the reduction had been made (i.e. the war) no longer applied and therefore the landlord could charge ground rent at £2,500 per annum again. But Denning also stated that the landlord would not be able to recover the unpaid rent from the war period, as he had promised not to and it would be inequitable for him to go back on his promise.
What's the principle of law?
The rather grand name for the principle is 'promissory estoppel'. It modifies the basic principle that a variation of a contract can only be binding if you give something in return for it ('consideration').
Promissory estoppel is applied at the judge's discretion where the alternative would be an unfair (inequitable) outcome. It will not be applied if the defendant has acted in bad faith. Where promissory estoppel is applied, it will protect a defendant who is in breach of contract but has acted in reliance of the other party's promise.
What's it like today?
The building is still looking elegant, and it appears that a roof terrace has been added. Here is a link to a blog with some much better pictures than my own.
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