Aslan v Murphy  [1990] 1 WLR 767

Mr Murphy occupied a basement room owned by Mr Aslan. It was a small room measuring 4ft 3in by 12ft 6 in. The agreement stated that the licensor was not willing to grant the licensee exclusive possession of any part of the room and that the licensor may permit others to use the room. The rent was referred to as a licence fee. The agreement also reserved Mr Aslan the right to retain keys. Mr Aslan was to provide services in the form of cleaning the room, rubbish collection, provision of and laundering of bed linen. However, in practice no others were permitted to enter the room and no services were actually provided.

Held:

Mr Murphy was a tenant rather than a licensee. The provisions relating to exclusive possession, permitting others to use the room and the provisions for services were a pretence for the sole purpose of defeating the Rent Act. The agreement was wrongly described as a licence. The retention of keys by a landlord will not automatically negate exclusive possession.

Lord Donaldson MR:

"The labels which parties agree to attach to themselves or to their agreements are never conclusive and in this particular field, in which there is enormous pressure on the homeless to agree to any label which will facilitate the obtaining of accommodation, they give no guidance at all… Exclusive or non-exclusive occupation - This is the touchstone by which the 'spade' of tenancy falls to be distinguished from the 'fork' of lodging."

“Quite apart from labelling, parties may succumb to the temptation to agree to pretend to have particular rights and duties which are not in fact any part of the true bargain. Prima facie the parties must be taken to mean what they say, but given the pressures on both parties to pretend, albeit for different reasons, the courts would be acting unrealistically if they did not keep a weather eye open for pretences, taking due account of how the parties have acted in performance of their apparent bargain. This identification and exposure of such pretences does not necessarily lead to the conclusion that their agreement is a sham, but only to the conclusion that the terms of the true bargain are not wholly the same as that of the bargain appearing on the face of the agreement. It is the true rather than the apparent bargain which determines the question 'tenant or lodger?'

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