Mehta v Royal Bank of Scotland

Mehta v Royal Bank of Scotland (2000) 32 HLR 45

Landlord and tenant; leases or contractual license; wrongful eviction

Facts

The Royal Bank of Scotland (RBS) were the mortgagees in possession of a hotel in Kensington. A receiver was appointed who continued to run the property as a hotel pending sale. Mehta entered in to an oral agreement with the manager with RBS’ consent, that he should occupy a room in the hotel with exclusive possession for an agreed monthly rent. Six months later Mehta was told to vacate the property the following day as a sale had been agreed. Mehta refused and was evicted the following day. Mehta sought damages for wrongful eviction and trespass.

Issues

Mehta argued the agreement amounted to a tenancy because he had exclusive possession of the room and the services provided by the hotel were limited in nature. He, therefore, claimed he held an assured tenancy under s1 Housing Act 1988 based on the definition of a tenancy in Street v Mountford [1985] AC 809. Mehta also claimed the removal of his belongings from his room amounted to a trespass. RBS claimed Mehta was a mere hotel room occupant and, as such, had no right to be given any notice period at all.

Held

Mehta was awarded damages for wrongful eviction. The test in Street v Mountford defining a tenancy as an occupation for a term at a rent with exclusive possession is useful in indicating the existence of a tenancy. The existence of these factors were not decisive, however, where other factors come into play. Here both parties knew the property was to be sold as a going concern, and that the arrangements were not those typically associated with hotel rooms. Mehta was, therefore, a contractual licensee who was entitled to a notice period of four months.