Licences

Question 1

What is a licence?

Answer 1

• ‘Dispensation or licence properly passeth no interest, nor alters or transfers property in any thing, but only makes an action lawful which, without it, had been unlawful’ (Thomas v Sorrell (1673)).
  -> Widespread in daily life.
  -> Limited in scope.
• The Calgarth 1927 -> when you invite someone into your house to use your staircase, they are only allowed to do that, not slide down the bannisters for example
• personal right, not proprietary

Question 2

What are Bare Licences?

Answer 2

• Default type.
• Licensor has inherent power to revoke.
  -> Effect on ex-licensee -> Winter Garden Theatre v Millennium Productions [1948], L Macdermott: after license expires, ‘will not be considered a trespasser before he has had a reasonable time in which to vacate the premises’.
  -> Effect on 3rd parties -> not binding.
  -> Licensee in exclusive possession can sue strangers in trespass -> relativity of title.

Question 3

what are Contract Licences ?

Answer 3

licence given as part of a contractual agreement

Question 4

is there a duty not to revoke for contractual licences?

Answer 4

• Winter Garden Theatre v Millennium Productions [1948] (HL) -> contract silent on licensor’s power to revoke.
• Hurst v Picture Theatres Ltd [1915] (CA) -> contract to remain in premises for duration of film.

Question 5

Revocation and remedies for contract licences?

Answer 5

• Licensee contractually permitted to be on premise and still on premises -> no eviction by court order because licensee ‘asking […] court to assist it in breaking its contract’ (Hounslow LBC v Twickenham GD Ltd [1971], Megarry V-C).
• Licensee contractually permitted to be on premises but not on land -> licensee may not use self help (Thompson v Park [1944] (CA)); licensee may receive over for specific performance from court (Verally v Great Yarmouth BC [1981] vs Thompson v Park [1944]: court cant ‘specifically enforce an agreement for two people to live peaceably under the same roof’, Goddard LJ).

Question 6

Contractual Licences and Third Parties: (1) Strangers

Answer 6

• Licensee in exclusive possession (‘complete and exclusive physical control’ over the land, JA Pye (Oxford) Ltd v Graham [2003], L Browne-Wilkinson) can sue stranger in trespass (National Provincial Bank v Ainsworth [1964] (CA): ‘exclusive possession [=] has dominion over the house’ + can sue trespassers, L Upjohn).
• Why can contractual licensee sue stranger in trespass? -> relativity of title.

Question 7

Manchester Airport plc v Dutton and others [2000] (CA)

contractual licence

Answer 7

Issue: can airport company (licensee not de fact in occupation or possession) evict trespassers by was of order for possession?

Laws LJ (Kennedy LJ agreed): licensee not in occupation can claim possession against trespasser if needed to enable them to enjoy rights from contract with licensor. Same principle that lets licensee in de factor possession to evict trespasser. No distinction between licensee in and licensee out of possession.

Dissenting opinion of Chadwick: licence = exactly of personal permission to enter land and use it for specific purpose and therefore did not confer authority rights to bring action in rem for possession of land to which it relates.

Swadling, ‘Opening the Numerus Clausus’ (2000): reason why licensee in possession can sue trespassers is because ‘he has a right of possession which is completely independent of the licence under which he occupies the land’. Laws LJ fails to recognise that contractual licensee in occupation has rights ‘derived from two separate sources’: contract + possession.

Alternative solution -> Hill v Tupper analogy, MA force NT to sue and elite Dutton (unlikely considering NT’s public role).

Continued controversy: approved obiter in Mayor of London v Hall and others [2010] by L Neuberger MR.

Question 8

Contractual Licences and Third Parties: (2) Successors in Title
orthodox view?

Answer 8

licences NOT property rights and cannot bind successors in title -> King v David Allen [1916] (HL): contract ‘creates nothing but a personal obligation’; Clore v Theatrical Properties [1936]: ‘merely […] a personal contract between the parties [and therefore] only enforceable [between them]’.

Question 9

Challenges to orthodoxy (1950s-60s)

Contractual Licences and Third Parties: (2) Successors in Title

Answer 9

contractual licence is itself a property right (must be equitable right - LPA 1925 ss.1(2) + 1(3)); contractual licence not itself property but capable of generation new property right in favour of licensee, binding on successor in title.

Contractual licence proprietary in itself? -> Errington v Errington [1952]:

L Denning’s logic (unsuccessful): 1. If licensor revokes licence in breach, licensee will/may be granted equitable remedies to prevent eviction; 2. Therefore contractual licensee has equitable right to remain; 3. Therefore contractual licensee has right capable of binding 3rd parties.

Criticism of logic: premise is true but conclusion does not follow -> equitable remedies don’t turn license into property right (NPB v Ainsworth [1965], L Wilberforce); did not cite any authority + not compatible with King v David Allen [1916] or Clore v Theatrical Productions [1936]; decision given ‘per incuriam’ (Fox LJ, Ashburn Anstalt v Arnold [1989]; disregard of s.4(1) LPA 1925.

Question 10

Which case restored the orthodox view?

Contractual Licences and Third Parties: (2) Successors in Title

Answer 10

Ashburn Anstalt v Arnold [1989] -> ORTHODOX VIEW RESTORED.

Not property right but can generate new property right in favour of licensee?

Binions v Evans [1972] -> L Denning’s reasoning: 1. Evans had contractual licence, gave rise to equitable property interest (rejected in Ashburn Anstalt [1989]); 2. Evans could not be evicted because a court will impose a constructive trust for her benefit even if licence not proprietary (‘legitimate application of doctrine of contrastive trusts’ in Ashburn Anstalt [1989], Fox LJ).

Test narrowed down in later cases: IDC v Clark [1992] -> no creation of CT unless ‘very special circumstances’ where transferee has to be affected in way that ‘gives rise to obligation to meet legitimate expectations of the third party’ (L Browne-Wilkinson); Lloyd v Dugdale [2002] -> ‘new obligation’ needed for CT.