Jamal Demachkie and Priya Gopal consider the recent High Court appeal in Man Limited v Back Inn Time Diner Limited [2023] EWHC 363 (Ch)

02 Mar 2023

Jamal Demachkie and Priya Gopal consider the recent High Court appeal in Man Limited v Back Inn Time Diner Limited [2023] EWHC 363 (Ch) which concerned the proper application of the intention to redevelop test under section 30(1)(f) of the Landlord and Tenant Act 1954.

The factual background can be summarised as follows:

  • The property in question was demised to the tenant pursuant to a lease which expired on 31 May 2018; the property was used by the tenant as an American-style diner.
  • The tenant, Back Inn Time Diner Limited, provided notice under s.26 of the Act seeking a new lease and the landlord, Man Limited, served a counternotice relying on s.30(1)(f) which provides that a landlord may oppose an application for a new tenancy where it is able to show:

that on the termination of the current tenancy the landlord intends to demolish or reconstruct the premises comprised in the holding or a substantial part of those premises or to carry out substantial work of construction on the holding or part thereof and that he could not reasonably do so without obtaining possession of the holding”.

  • The landlord asserted that it intended to redevelop the property into a multi-storey mixed-use development, for which planning permission had been sought but refused. The landlord was proceeding with an appeal of the refusal of planning consent at the date of the hearing.

Decision at First Instance

His Honour Judge Duddridge concluded that, although the landlord had the requisite subjective intention, it lacked the required objective intent for ground (f).  The judge found against the landlord in two respects: the lack of any real prospect of obtaining planning consent, and the lack of sufficient evidence concerning the landlord’s ability to fund the development.

However, between the draft judgment being circulated, and the final judgment being handed down, the landlord’s planning appeal succeeded.  The judge refused to reconsider his ruling; as the matter was put in a post-script to the judgment:

“[the landlord] now has a realistic prospect of obtaining planning permission for the stepped scheme [but] the planning issue was not the only reason why I found that [the landlord] had not established ground (f). I also found that [the landlord] had failed to prove that it would be able to fund the development within a reasonable time after the end of the tenancy.”

The Appeal

The landlord sought permission to appeal.  The grounds were split into two categories: the judge’s treatment of the evidence on funding, and the judge’s application of the legal test of intention in respect of funding.  Permission was granted in respect of two grounds, and refused in relation to two others.

Decision of Sir Anthony Mann on appeal

The evidence of funding

Whilst there was some evidence of funding before Judge Duddridge, bank statements providing concrete evidence of funding were not disclosed by the landlord until the start of its evidence at trial.  Judge Duddridge, after considering the requirements for relief from sanctions under Denton v T H White [2014] EWCA Civ 906 refused to admit these statements.  Sir Anthony Mann, in emphasising the difficulties with appealing an exercise of discretion (particularly on a matter of case management), held that the Judge’s refusal could not be criticised.  The landlord’s failure was clearly serious, and there was no good reason for this breach.  The Judge had been justified, when considering stage 3 of Denton, to look back at the first two stages, but he had also considered prejudice.  This was, as Sir Anthony Mann stated, a classic judicial evaluative exercise, and there was no real prospect of overturning the judge’s decision.

On a separate, but related issue (for which permission had been granted) Sir Anthony Mann also held that Judge Duddridge had made no material error in failing to refer, in his judgment, to documentary evidence said to corroborate the landlord’s oral evidence of availability of other properties for the purpose of funding.  Whilst there was evidence of the ownership of another property before Judge Duddridge, this property had not been identified in the witness statement as being available for funding the development and the connection between that property and security was “slim if it existed at all”.  This ground of appeal was dismissed.

The Legal Test for Funding

The more substantive point concerned the legal test in respect of intention, and whether Judge Duddridge had set the threshold too high when considering the evidential burden on the landlord in respect of funding.

In respect of the objective limb of intention, the landlord need only show that it has a realistic prospect of implementing its intention.  This ‘realistic prospect’ test is usually applied to the likelihood of obtaining planning permission, and has been held to mean “a real chance”, as opposed to a “fanciful” one (Cadogan v McCarthy & Stone [2000] L&TR 249).  Sir Anthony Mann agreed that the same test would apply to the availability of finance, and referenced the case of DAF Motoring Centre v Hutfield & Wheeler [1982] EGLR 59 in support.

In the instant case, it was said that the judge had applied a different test: In respect of planning, Judge Duddridge had evidently applied the ‘real as opposed to fanciful’ test; however, when considering funding, the Judge had repeatedly referenced the landlord having to prove that it “would be able to fund the development”; at times in his judgment, he had seemingly contrasted that ‘would be able’ test with the ‘real prospect’ test for funding.

Sir Anthony Mann agreed that the wording used by the judge might be capable of justifying the inference that he had applied a higher threshold for funding than for planning.  However, when the judgment was read as a whole, including the earlier references to the correct test, Sir Anthony Mann considered that the judge had the right test in mind.  The appeal was therefore dismissed.


The most significant point arising from this appeal for property practitioners is the application of the ‘real, as opposed to fanciful, prospect’ test in respect of intention under ground (f) (and, by parity of reasoning, claims under ground (g) – own occupation). Sir Anthony Mann accepted that, although it is usually applied to planning hurdles, the ‘realistic prospect’ test applies with equal measure to the likelihood of funding any re-development.

The judgment also contains a reminder of the need to focus on the correct test, and the subtle difference between the language used.  Although, on the facts of this case, the statements of the first instance judge were not incorrect, the language of intention can be tricky to pin down:  the test is ‘realistic prospect’ of implementing the intention; it is not whether the landlord ‘will be able’ to be implement its intention.  Such a test would set the bar too high.

Finally, and perhaps most practically for landlords wishing to rely on ownership of other properties to support the redevelopment ground, the distinction drawn by Sir Anthony Mann between ownership and availability of the property as security is an important one.   Even though the hurdle on intention may be a relatively low one, the burden remains on the landlord; simply producing evidence of ownership of property is unlikely to be sufficient in circumstances where the landlord is unable to demonstrate a connection between ownership and the ability to obtain security over that property.

Jamal Demachkie and Priya Gopal appeared for the Appellant landlord in the appeal.

Read the full judgment here.


Jamal Demachkie

Jamal Demachkie

Call: 2004

Priya Gopal

Call: 2014


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