AG Securites v Vaughan; Antonaides v Villiers [1990]

In two appeals heard together, the House of Lords held that exclusive possession of merely a bedroom is not sufficient to create a tenancy, and also that a tenancy cannot be disguised as a licence by a clause in the agreement which contradicts the character of the agreement.

AG Securities v Vaughan – four separate bedrooms in a house were occupied by four individuals, each with their own independent agreements. Each occupier had exclusive possession of one bedroom, but shared possession of the other parts of the house. The Court of Appeal held that the occupiers were tenants, with a joint tenancy.

Antonaides v Villiers – a couple occupied a one-bedroomed flat, each having a licence which expressly reserved to the owner the right to share and permit other persons to share the flat. This reservation could not reasonably be acted upon, but meant that the couple appeared not to have exclusive possession of the dwelling. The Court of Appeal held that the occupiers had a licence rather than a tenancy.

On appeal:
HELD: The House of Lords reversed the decision of the Court of Appeal in both cases:
AG Securities v Vaughan – the occupiers did not have a joint tenancy, as none of them had exclusive possession of a dwelling. Each occupier had rights against the others as the arrangement was not artificial; it was a convenient way in which the property could be occupied by independent individuals who would change frequently.
Antonaades v Villiers – the occupiers did have a joint tenancy, as the House regarded the owner’s reservation of the right to introduce other people into the property to be repugnant to the true purpose of the agreement. It was decided that the provisions allowing this were never intended to be acted in, and had been introduced into the agreement purely to disguise the occupiers’ exclusive possession of the flat. It had been a pretence, to enable the owner to purport to grant a licence rather than a tenancy and to prevent the occupiers enjoying the protection of the Rent Acts.

These two appeals illustrate the circumstances in which a residential occupier will be treated as a licensee and those in which he will be treated as a tenant. They highlight the judicial consideration of the agreement in deciding whether an occupier has exclusive possession.

Citation: AG Securities v Vaughan; Antonaides v Villiers [1990] A.C. 417