Vesely v Levy & Others [2007]

The grant of exclusive possession did not confer a tenancy on a lodger, as neither party wished to create formal legal relations.

A trust was set up by the father of a girl, Marian, with a history of mental health problems, in order to provide for her. The trust purchased a residential property with the intention of providing a home for Marian. However, before Marian could occupy the property, she let an acquaintance, Miss Vesely, into it.
Miss Vesely moved her belongings into the flat and started living there without the knowledge or permission of the trustees.
When, in April 1996, the trustees discovered this arrangement, they initially made moves to evict Miss Vesely.  Marian subsequently moved into the flat, and when the two women became friendly, it was decided that Miss Vesely and Marian would continue to share the flat and that Miss Vesely would make a weekly contribution of £65 to the joint household expenses of the two women.  The payments were not intended to be rent, and were not denominated as rent.  No payments were made to the trustees.
This arrangement was later questioned when the trustees came to serve notice on Miss Vesely some ten years later.  Miss Vesely claimed that she held an assured tenancy which gave her security of tenure.

HELD: The Court of Appeal held that because at the initial stage of Miss Vesely's occupation there had been no intention to create legal relations, she was merely a lodger. Although there had been exclusive possession of some rooms, and a tenancy may arise even without payment of rent, the special circumstances of this case were regarded to have negatived the normal inference of a tenancy from the grant of exclusive possession.

This case is interesting in showing what happens if a property owner and occupier do not want to create formal tenancy relations. This might happen if, for example, a property has been let to a sole tenant and then a friend moves into occupation.