(1989)1989 July 21 (SAWIDES KOURRIS BOYADJIS,J J) KORINA CHARALAMBOUSIACOVIDES, Appellant-Defendant, ν LOIZOSCHRISTODOULOU. Respondent (CivilAppeal No 7322) Rent Control — Eviction — The Rent Control Law, 1983 (Law 23/83), section 11(l)(d)— Subletting premises in breachof a covenant not to sub-lease without the landlord's written consent—Sub tenants are a family company of the statutory tenant — Rent payable under the sub-tenancy the same as that payable by the 5 tenant — Business earned on in the premises remained the same — Evictionorderrefused on ground thatitwas not reasonable toissue it —Such decision was reasonablyopen to theRent ControlCourt The facts ot this ^.ase sufficiently appear from the hereinabove headnote In lefusing to issue the eviction order the Rent Control 10 Court should take into account all the circumstances of the case, including interalia,whetheritwould be reasonable ornotonthepart of the landlord to refuse the tenantto sublet the premises the kind of business the sub tenant would cairy on in the premises and the rent payable thebub-tenant 15 Appeal dismissed No orderas tocosts Casesreferredto Michaelides ν Gavrtelides
(1980)1C LR 244 Appeal. 20 Appeal by applicant against the judgment of the Rent Control C o u r t L a m a c a d a t e d t h e 11thDecember, 1986(Appl No Ε 116/ 84) whereby her claim for an order of recovery of possession of a s h o p at No 1 Kynacos Matsis Sir Larnaca was dismissed. 398 1 C.L.R. lacovides v.Christodoulou A. Andreou, for the appellant. G. Georghiou, for therespondent. Cur. adv. vult. SAWIDES J.: The judgment of the Court will be delivered by 5 Mr.Justice A. Kourris. KOURRISJ.:Thisisanappeal against thejudgment of theRent Tribunal of Lamaca by which itdismissed applicant's/appellant's claim for an order for the recovery of possession of ashop situate atNo. 1Kyriacos MatsisStreet,atLamaca,undertheprovisions of 10 Section Π
(1)(ζ> and Section ll(l)(d) of the Rent Control Law 1983, (Law 23/83). The appellant is the owner of a shop situate at No. 1 Kyriacos Matsis Street, at Lamaca, and the respondent is the statutory tenant of the said premises. The appellant filed an application in 15 the Rent Tribunal of Lamaca claiming possession of her shop pursuanttotheprovisions ofSection 11
(1)(ζ)andSection 1l(l)(d) of theRentControl Law 1983,buttheRentTribunal,after hearing the case, dismissed theappellant's claim for possession of thesaid premises. 20 During the hearing of the appeal appellant abandoned her ground of appeal under Section 11
(1)(ζ) and the appeal proceeded tohearing totheeffect thattheTribunal went wrong in dismissingtheappellant'sclaimunderSection 11(l)(d)of the Law. Itis pertinent at this stage to set out the provisions of Section 25 1l(l)(d)which reads as follows:- 30 35 «11
(1). Ουδεμία απόφασις και ουδέν διάταγμα εκδίδεται δια την ανάκτησιν της κατοχής οιασδήποτε κατοικίας ή καταστήματος, δια το οποίο ισχύει ο π α ρ ώ ν Νόμος, ή δια την εκ τούτου έξωσιν θέσμιου ενοικιαστού, πλην των ακολούθωνπεριπτώσεων (δ) Εις περίπτωσιν καθ' ην ο ενοικιαστής, π α ρ ά την ρητήν υποχρέωσιν περί μη υπενοικιάσεως ήθελε παραβεί ταύτην, και το Δικαστήριον θεωρεί λογικήν την έκδοσιν τοιαύτης α π ο φ ά σ ε ω ς ή τοιούτου διατάγματος». 399 KourrisJ. Iacovides v. Christodoulou
(1989)The facts shortly are these. The respondent was the statutory tenantof theshop inquestion since 1972 andwas sellingelectrical appliances. His son and his daughter were working in the business. The rentpayable was £55.- permonth. Itwas an express provision of the contract of lease dated 1.12.1978, which was Exhibit 1 before the Court, that the tenant was not entitled to sublet the shop without thewritten consent of the landlord. 5 In 1983 the tenant formed a family company with the only shareholders being thetenanthimself,hiswife,hisson andhis two daughters under the name of «Δ. Χριστοδουλίδης (Φωτιστικά 10 και Κεραμικά) Λτδ.», which company carried on the said business. The respondent without obtaining the consent of the landlord sublet the shop tothecompany atthesame rent. The RentTribunal found that on the evidence before it, it was not reasonable toissue an order of ejectment against the tenant. 15 The sole issue in this appeal was whether the landlord was entitled to obtain an order of ejectment underSection ll(l)(d) of the Rent Control Law 1983, on the ground thatthe tenant sublet the shop without the written consent of the landlord in breach of thecontractof lease entered intobetween them. 20 Counsel for the appellant argued that the tenant sublet to a company, which is a legal entity entirely separate from its shareholders, in breach of thecontractof lease and therefore, the RentTribunalwent wrong indeciding thatitwas notreasonable to issue an orderof ejectment against thetenant. 25 Counsel relied mainly onthecase ofMichaelides v. Gavrielides,
(1980)1C.L.R.244. Inthatappeal thesole question was whether the landlord was entitled to obtain an order of ejectment, under Section 16(l)(g) of the Rent Control Law, 1975 (Law 36/75) which is now Section 11
(1)(ζ)of the RentControl Law 1983 (23/ 30 83),on theground thatthepremises were required forthe carrying on of a business by his son where, in fact, the business was to be carried on by a limited company of which the son and his wife were the two shareholders and of which they had complete control. Itwas held:3o «... that a company and the individual or individuals forming a company are separate legal entities, however complete the control might be by one or more of those individuals over the company;thatthemeaning of the words 400 IC.L.R. lacovides v. Christodoulou KourrisJ. in section 16(l)(
- g)of Law 36/75 is plain and unambiguous and that the law passed purported to protect the class of persons referred to in paragraph (
- g)and had nothing to do with private companies;andthatonce theson of thelandlord andhiscompany areentirely separate entities,andthisisnota matter of form but a matter of substance and reality, the landlord or his son cannot bring themselves within the provisions of section 16(l)(g)by holding thepremises through a company which theson and hiswife control (principles laid down by Willmer L.J. in Tuntstall v. Steigmann [1962] 2 All E.R.417 atpp. 421;422 and423 andprinciples formulated in Gramophone and Typewriter Limited v. Stanley [1908] 2 K.B.D.89 atpage 98 adopted». 5' 10 Itshould be notedthatunderthatSection only thecategories of 15 personsexpresslymentionedinSection 16(l)(
- g)couldinvoke that Section and, ifthey did notbring themselves within the provisions of Section 16(l)(
- g)now Section 11
(1)(ζ) the landlord could not obtain possession of the premises. Under Section 1l(l)(d), which isanew provision which didnot 20 exist in the provisions of the Rent Control Laws, a rent tribunal should examine whether it is reasonable to issue an order of ejectment although, the tenant,despite an express obligation not to sublet, he did sublet the premises. In considering whether it is reasonable to issue an order of 2 5 ejectment, the Rent Tribunal should take into account all the circumstances of thecase, including interalia, whetherit would-be reasonable ornotonthepartof thelandlordtorefuse thetenantto sublet the premises, the kind of business the sub-tenant would carry on inthe premises and,the rentpayable by thesub-tenant. 30 m the present case theTribunal,inrefusing toissue an orderof ejectment, it has examined whether the landlord could refuse to give his consent for a sub-lease in extenso, and it also took into consideration that it was a limited family company with share holders the persons who carried on the business in the premises, 35 thefact thatthecompany continuedtocarry onthesame business as before and,inexercising itsdiscretion refused toissuean order of ejectment statingatthesame timethattheywould have cometo a different conclusion if the shareholders were different persons from the persons who carried on thebusiness mthe shop. 401 kourris J. Iacovides v. Christodoulou
(1989)Ithas been the complaint of counsel for the appellant that the Tribunalproceeded toexaminewhetherthelandlord could refuse hisconsent for a sub-lease although itwas never asked from the landlord to give such a consent so that an opportunity should be giventothelandlordtoadvance hisgroundsforrefusal. Wedonot 5 think that thisargument hasanysubstance because the landlord's application wasbased on Section 1l(l)(d)inwhichcaseshe could place allthe material she wanted before the RentTribunal. Having regard to the evidence which was before the Rent Tribunal, itsconclusion, to exerciseitsdiscretion torefuse toissue 10 an order of ejectment, was reasonably open to it and therefore, thisappeal isdismissed but with no order for costs. Appeal dismissed with no orderasto costs. 402