Johnston v. Horace [1993] IEHC 3; [1993] ILRM 594 (26 March 1993)

High Court
 
Therese Johnston and Kathleen Kelly
(Plaintiffs)
 
v.
 
David Horace
(Defendant)

No. 992p of 1991
 
[26th of March, 1993]
 
Status: Reported at [1993] ILRM 594
 
Lavan J. 
 
	 The second named plaintiff was by consent struck out of the action at the commencement of the trial.
 
	The plaintiff, Therese Johnston, was born into the home, the subject matter of these proceedings, situate at Crumlin, Dublin. She lived therein with her parents and family until 1986 when unhappy differences arose between her and her nephew, David Horace, the defendant herein.
 
The plaintiff’s sister, Bridget Kinsella, now deceased, married a Mr. Horace. By the invitation of the plaintiff’s family the Horaces also set up house in the home. It is agreed that the home was at all material times modest. Yet it was a home to all who resided therein. Its situation was in a long established part of the city, convenient to the city centre and I am happy that the Kinsella’s were an established and well known family in the surrounding area.
 
By a will dated 27 September 1961, Patrick Kinsella (the deceased) appointed his married daughter, Bridget Horace, to be his sole executrix and beneficiary of all his estate and interest that he should die possessed of subject to a right of residence in favour of his son Edward (now deceased), the plaintiff and the second named plaintiff, who was a daughter of the first named plaintiff.
 
The deceased died on 2 January 1956 and probate of his said will duly issued on 27 September 1961 to his executrix.
 
The plaintiff’s right of residence has been registered as a burden on Folio DN 008827 County Dublin.
 
From that time the plaintiff resided in the home caring for her family. Mr. and Mrs. Horace died thereafter and the defendant took the property absolutely subject to the aforesaid rights of residence.
 
Edward Kinsella, the son, suffered from a physical disability. However, he lived happily at home and was content with his lot. The plaintiff fed and cared for him. Following the death of Mrs. Horace, the plaintiff also looked after her brother-in-law and the defendant. Edward died on 31 January 1986. He was predeceased by Mr. Horace senior.
 
On 24 January 1991 the plaintiff instituted these proceedings seeking:
 
1. An injunction to restrain the defendant by himself his servants, agents or otherwise howsoever from preventing the plaintiffs from exercising their rights of residence in the home, 10A Sommerville Avenue, Crumlin in the City of Dublin.
 
2. An order that the defendant do forthwith deliver up to the plaintiffs a key to the said premises.
 
3 Further and other relief.
 
4. Damages.
 
The statement of claim issued on 5 February 1991. Following an exchange of letters seeking particulars, a defence was filed on 7 May 1991 including a counterclaim against both plaintiffs. The counterclaim sought was as follows, as against this plaintiff.
 
1. A declaration that the first named plaintiff has abandoned her right of residence in the premises aforesaid.
 
2. A declaration that the aforementioned first named plaintiff’s right of residence stand determined.
 
On 3 July 1991 the plaintiffs delivered a reply to the defendant’s counterclaim.
 
The matter first came before me on 23 October 1992. The plaintiff gave evidence of how the defendant, following Edward’s death, commenced a campaign of oppressive and bullying behaviour towards her which was of such a nature as to cause her to leave the premises against her will. At that stage all of the other members of the family were dead.
 
The defendant also gave evidence to me and denied all of the allegations contained in the pleadings and the evidence adduced before me.
 
Having heard submissions from both counsel on the first day, I adjourned this case on a number of occasions. Finally, on 19 February 1993, I heard further evidence on behalf of both parties. This evidence was directed towards determining the measure of assessing a loss of residence and as to the value of the home and as to appropriate rental levels of equivalent accommodation for the plaintiff. I heard evidence from valuers for both parties in relation to the market value of the premises as of 1986. This was put at the sum of £30,000 by the defendant’s valuer. I note however that the defendant valued these premises as of March 1990 at £40,000. Taking everything into account I would assess the value as of 1986 as at £35,000.
 
In relation to rental value in 1986,1 would accept the figure of £25 per week as being a minimum figure to provide the plaintiff with a similar form of accommodation. The actuarial figure I accepted as being a sum of £555 for the loss of each £1 by the plaintiff. Therefore the future loss I accept to be £13,875 for the plaintiff not to be restored to her rightful right of residence as provided by her father as far back as 27 September 1961.
 
Following upon the conduct complained of by the plaintiff, she moved to live with her married daughter in Tallaght, Co. Dublin.
 
Between 1986 and 1990 the defendant carried out alterations to the home, including the installation of a toilet. He later became engaged to be married. On 19 March 1990 the defendant wrote to his aunt in the following terms:-
 
Dear Teasie, 
 
In reply to your letter, yes I am interested in selling 10A but only because you won’t surrender your right of residency as I said this is not negotiable. 
 
	As you know I am getting married and as you have in practice already given [sic] up your right, I just wanted it in writing. I feel it is not fair to bring a wife into the home with this hanging over us, as we would like to have a family, we would like to know we have the room to do so, as you have said before that you would not come back to 10A I felt it was not too much to ask of you.
 
But if you want to buy the house it would have to be valued by a party unknown by either one of us, you may have gathered that I don’t really want to give up the family home, I just want to feel I can have my own family in it, without the threat of a right of residency.
 
David.

 
A second undated letter was tendered in evidence also from the defendant to the plaintiff as follows:-
 
Dear Teasie, 
 
So you are open to offers. Well as I am not in a position to offer, would you like to buy 10A from me for £40,000 and I will await your answer? 
 
Dave.
 
PS Just £40,000 and it’s yours.
 
I accepted the plaintiff’s evidence. I considered her to have been a mature and truthful witness. I am satisfied that the defendant engaged in a careful and sustained campaign to rid himself of his aunt. He made life unpleasant for the plaintiff and purported to interfere with her proper enjoyment of her home and to interfere with her entitlement to use the home as such. He sought to restrict her access, to control her access and to limit her use effectively to that of her bedroom and nowhere else. I accept the plaintiff’s evidence that the conduct of the defendant was such as to make living in the home intolerable for her. I must say that I utterly reject the defendant’s case. There is no cogent evidence that the plaintiff ever abandoned willingly her right to live in her own home. I accept she was forced to leave because of the defendant’s behaviour which was, in my view, behaviour of a conscious and concerted manner seeking to force her out. In my view there is no other phrase sufficiently accurate to describe his conduct.
 
I reject the grounds relied upon by the defendant in his defence. I reject his allegation that she has no bona fide desire to return to the premises; that she failed to exercise her alleged rights of residence; that she abandoned her right. In particular, I reject that at no stage during the lengthy course of redecoration, repair and reconstruction of the home that the plaintiff knew of what was going on, permitted what was going on to take place without making it clear that she was abandoning her right of residence.
 
In my view, no assessment of the defendant’s evidence could constitute a rebuttal of the duress alleged against him, nor indeed could it establish that he at any time behaved in a manner, other than in a deliberate manner, to force the unfortunate woman out of her house.
 
In addition, I accept that the plaintiff was unaware of what steps or remedies might be available to her to vindicate her rights until 1990 when, as a result of the foregoing correspondence, she retained a solicitor who caused these proceedings to be issued.
 
Turning to the question of what is the appropriate remedy in this case, counsel for the defendant says that damages are an adequate remedy. Alternatively, he says that the defendant’s situation has altered by marriage and the alterations he has made to the house. Or, alternatively, that the defendant has no money.
 
In support of his submissions that damages were an adequate remedy, counsel for the defendant submitted that the appropriate law was as follows.
 
The law
 
S.	81 of the Registration of Title Act 1964 provides:-
 
A right of residence in or on registered land, whether a general right of residence on the land or an exclusive right of residence in or on part of the land, shall be deemed to be personal to the person beneficially entitled thereto and to be a right in the nature of a lien for money’s worth in or over land and shall not operate to create any equitable estate in the land.
 
The first named plaintiff comes within the first category namely enjoying a general right of residence and has accordingly a lien for money’s worth in or over the land. The discussion contained in Irish Land Law (2nd ed.), Wylie, 20.13 – 20.24 on rights of residence concludes that s. 81 of the Act of 1964 excludes the plaintiff from having the statutory powers of a tenant for life. Her right being in the nature of a lien is the right to bind the property for payment of the money’s worth of the residential use.
 
Neither the case law nor the statute clarifies whether or not the beneficiary of the right or the owner of the property can insist on the right being converted into money’s worth.
 
In the case to hand the plaintiff asserts that she has been deprived of the right, the defendant denies this. The plaintiff wishes her right to be valued.
 
I have no doubt but that there are circumstances in which a court could enter by agreement of the parties into a valuation of their respective interests. There are also circumstances where a court might compel such a valuation in the general interest of the administration of justice or under its equitable jurisdiction. The court in valuing the right should carry out an objective valuation independent of the alleged circumstances in which the valuation is sought.
 
There are no authorities as to how such a valuation should be carried out. Such case law as does exist predates the statute and provides only a general guide as in National Bank Ltd v Keegan [1931] IR 344 at 354 where Kennedy CJ states ‘the general right of residence charged on a holding is capable of being valued in moneys numbered at an annual sum, and of being represented by an annuity or money charge’.
 
The reference above to an annual sum reflects the fact that the right is of an ongoing nature and as such it should be measured by reference to some reasonable periodic period depending on the circumstances of the parties. In that context the period could be monthly, quarterly or yearly.
 
Before considering the money’s worth the characteristics of the right as granted have to be established. In this case the first named plaintiff enjoyed:-
 
(a) A right to share with others the use and occupation of the premises
 
(b) While not granted any exclusive rights she enjoyed the personal use of one bedroom in a three bedroom cottage.
 
In the circumstances it would be reasonable to say that her proportionate interest in the use and occupation of the premises was one-third.
 
In so far as the plaintiff did not contribute to the substantial improvement of the premises it would be reasonable to apply the principle applied in use and occupation cases as set out in McGregor on Damages (15th ed.) at paragraph 1420 namely that the value of the right should be assessed on the assumption that the premises were unimproved.
 
In the absence of any market in rights of residence the court must look to such comparables as can be found for guidance on valuations. One such method is the rental value of similar premises. In this case the question to be asked is what would represent a third of the rental value of the cottage in its unimproved condition or of such similar property of similar character in a similar area.
 
Other alternative though less precise valuations would be the sum one would reasonably expect a residing relative to contribute to a household in respect of the right to reside excluding contributions in respect of other household expenses.
 
To value the right in terms of the cost of acquiring other alternative accommodation suitable to the individual concerned is to stray away from measuring the money’s worth of the right of residence and to enter into the area of compensatory assessment. In that regard there are a whole range of options available with significant variations in rent levels depending on whether the private, public or social housing markets are assessed and it raises further questions as to the application thereto of taxation provisions such as s. 142A of the Income Tax Act 1967 as inserted by s. 5 of the Finance Act 1982 and presently providing for a tax allowance in respect of the first £1,500 of rent paid by a widowed person over 55 years of age.
 
In many respects the objective valuation of the right of residence is the method signposted by statute. There are dangers in any formula that the actual values may throw up an unrealistically high valuation of the right, given the limited nature and extent of the right granted and the implied intention of the legislature to be read into s. 81 of the 1964 Act that the valuation should not unduly force a sale of the property so as to destroy the other interests therein. To that extent any valuation needs to be tempered with caution.
 
In so far as the court has to arrive at a valuation, that valuation should be measured as a periodic sum. The periodic sum should not be capitalised. It is only in circumstances where such periodic sums are not being paid or that the property is being disposed of that the lien becomes a lien secured or enforceable by way of additional security in the form of a capitalised sum if necessary. To capitalise the money’s worth of the right is akin to giving the beneficiary the equivalent of the statutory rights of a tenant for life. To capitalise assumes the ability of the owner of the property to pay or raise a capital sum or in the alternative becomes punitive on the owner in that the cost of sale of the premises has to be borne and the additional cost of repurchasing another property at some later date.
 
As I understand the defendant’s submissions, they are, in part, to be summarised as follows. The court ought to ignore the defendant’s conduct. It ought to ignore the testator’s intention. It ought to enable the defendant benefit by excluding the plaintiff and thereby place the burden of providing for the plaintiff’s residence either on the appropriate statutory authority or on the plaintiff herself.
 
Counsel for the plaintiff submits that the proper approach is to value the actual loss to date and into the future to capitalise the sum that it will cost the plaintiff to provide for alternative accommodation.
 
I have had ample time to consider this case. I view any conduct which, in this era of homelessness, puts a person out of their home as being reprehensible. In this case, the plaintiff’s father made provision for her – as indeed, he did for all the members of his family, including his son-in-law, the defendant’s father. The provision by the deceased might appear modest. It was not. It made provision for one of the most basic requirements that any human being yearns to attain. That is a roof over their heads for life, and a security that same would be available until the end of their days – that is a right of residence for life.
 
In my view the right granted is an unrestricted right. The right is not abandoned by an absence of a day, or a week, or indeed a number of years. The right cannot be varied to suit the whim of the owner. Its nature and content must be viewed by the court from the right granted in the ensuing conduct of all concerned, including the common recognition of the right and the common use that right has conferred upon the plaintiff and other members of the family since the death of the deceased testator.
 
The right may voluntarily be abandoned expressly and freely, or indeed by effluxion of time. However, a court would have to require strong cogent evidence from a party seeking to defeat such a right, whilst the right remains a burden on a folio and in the absence of express agreement parol or written to disclose an intention to abandon.
 
In this case, I am satisfied that there was duress on the part of the defendant; that there was no abandonment by the plaintiff and that it would be unjust to permit the defendant to profit by his conduct.
 
I do not consider that this is a proper case to permit the abandonment of the right of residence. Both parties are of modest means. To suggest that the plaintiff ought to be a burden on the local authority or, indeed, that she might avail of taxation relief is to ignore the reality of the circumstances of the case.
 
I consider the suggestion of valuing the right of residence unreal. Where I have to value same, I take the view that it would have to be on an actuarial basis, having regard to the defendant’s conduct and his inability to pay. In addition, I take the view that a secured right of residence would otherwise become an unsecured right with no certainty that periodic payments would or could be made.
 
In my view the defendant has not the means nor the intention to make proper provision for the plaintiff’s right of residence. In addition, the defendant seeks to obtain court approval to defeat a dead man’s well considered intention to properly provide for his children, including the plaintiff in this case. He who comes to equity must come with clean hands.
 
In these circumstances, I propose to grant the plaintiff the injunctive reliefs she seeks. I also propose to award damages. I accept the plaintiff has suffered great distress, inconvenience and upset. Because of the limited means of the defendant, I will allow a figure of £7,500 damages for the interference with the right of residence to date. In so doing I wish to make clear that this is not to be taken as expressing my view as to the appropriate measure of damages for interference with a person’s right of residence. It is, in my view, an act which warrants substantial damages in most cases.
 
In the circumstances I dismiss the defendant’s counterclaim. I award the plaintiff her costs of the action.