Shaggy dog stories — Allowing pets in leasehold properties

This year has seen a number of legal developments regarding both property and dogs. Some landlords are reluctant to allow animals onto leasehold premises due to concerns that pets may cause damage or a nuisance to their other tenants.

Leases often provide that lessees may keep a dog or other animal but only if they obtain the landlord’s express written consent. Total bans on pets might be struck down under legislation intended to protect individuals from onerous or unfair terms in contracts, such as the Consumer Rights Act 2015, and would not allow for guide or assistance dogs.

Injunction requiring a dog’s removal

Victory Place Management Company Ltd v Kuehn and another concerned a gated residential community including 146 flats or maisonettes. These properties were let under long leases, which provided that no dog or other animal could be kept without the written consent of the properties’ management company (VPMCL).

The leaseholders in one property wanted a dog for therapeutic reasons, although had no medical evidence to support that. VPMCL refused consent, referring to a ‘no dogs’ policy. VPMCL issued proceedings and obtained an injunction requiring the dog to be removed from the property.

The leaseholders’ appeal

The leaseholders appealed, arguing that VPMCL had failed to comply with an implied obligation to reasonably deal with the application.

The court dismissed the appeal. The covenant had been expressed to be for the benefit of other leaseholders as well as VPMCL. The negative formulation of the covenant created a presumption that pets were not allowed without written consent. VPMCL considered what policy it was applying and made clear to the leaseholders that its policy was not to allow animals save in special circumstances. VPMCL had not made its decision before the formal request was made and might have taken a different decision had medical evidence been produced. VPMCL’s board was carrying out the wishes of the majority of the leaseholders by enforcing its ‘no pets’ policy.

Secondly, the ‘no pets’ policy did not amount to a predetermination of the decision. In such a company, the views of the leaseholders who were its members were important. They had elected and could remove VPMCL’s board. A majority of leaseholders being in favour of the policy did not entitle VPMCL to behave unreasonably but it did justify VPMCL’s decision to tell anyone interested in the covenant about the policy.

Finally, a policy that requests would be refused save in special circumstances was reasonable. The implied term was only to operate a reasonable process in considering applications. The existence of the policy did not mean that VPMCL had illegitimately decided the outcome of the application in advance.

Restrictive covenants — grooming parlour

The following month, dogs were the subject of another decision regarding covenants. Re Holden’s Application concerned a dogs’ grooming parlour in a former detached double garage. Restrictive covenants in the transfer to the owner, Mr Holden, precluded the carrying on of any trade or business from the premises. He was successful in obtaining a modification but not a full discharge of those covenants, under section 84(1) of the Law of Property Act 1925, which enabled him to continue trading.

Section 84 of the 1925 Act allows the Upper Tribunal (rather than the court) to discharge or modify any restrictive covenant if it is satisfied that one or more of the grounds specified in the section are satisfied. Mr Holden applied under section 84(1)(a) and (c), which required (for ground (a)) material changes to the character of the land or area or that there had been some other change in the material circumstances so that the restrictions could be deemed obsolete or (for ground (c)) that the modification would not injure the persons benefiting from the restriction.

Mr Holden failed in his ground (a) application, as the neighbourhood had not changed. However, the tribunal agreed that the grooming parlour did not represent a threat to the protection scheme contained in the covenants.

Labour’s draft policy on animal welfare

February 2018 also saw the Labour Party launch a new draft policy on animal welfare, entitled ‘Animal Welfare For The Many, Not The Few’. Under these plans, tenants would have a ‘default right’ to pets and landlords could only refuse animals if there is evidence of them being a nuisance.

It is unclear whether the proposals would apply only to short-term residential tenancies, such as assured shorthold tenancies, or whether they are also to cover long-term leaseholders, such as those in the Victory Place case. New legislation is unlikely to have retrospective effect, which would mean that whilst an assured shorthold tenant would be entitled to keep a pet, if their landlord is a leaseholder subject to a pre-existing restrictive covenant, the ultimate landlord would still be able to withhold its consent.

What constitutes a nuisance?

Labour has yet to clarify the precise scope of a landlord’s ability to remove a nuisance dog under the new policy. Nuisance generally involves someone doing something on their landlord that causes physical damage to neighbouring premises or which amount to an unreasonable interference with a neighbour’s use or enjoyment of their property. Regularly loud barking or unpleasant odours are likely to provide grounds to remove a pet.

Warning from the Residential Landlords Association

A legislative relaxation on the keeping of dogs may be welcomed by some tenants but the Residential Landlords Association has already warned that such changes could result in higher rents or insurance premiums.