The landmark ruling draws a line under a long-running battle by the Day Estate, which owns swathes of land in Kensington, and the Howard de Walden Estate, the owner of Marylebone High Street, to overturn a decision previously backed by the Court of Appeal.
The debate centred around the Leasehold Reform Act 1967, which gives leasehold tenants of houses the right to buy the freehold. The appeals by Day against its tenant Hosebay and Howard de Walden against tenant Lexgorge raised the question of whether a property used for business purposes could still be defined as a “house”.
Hosebay, which had served notice on the Day Estate to buy the freehold, was using the buildings to provide short-term accommodation for tourists while in the Lexgorge case, the building was primarily made up of offices.
The Supreme Court yesterday decided that neither buildings were a “house reasonably so called”.
“This will be a very welcome judgment for landlords of commercial properties,” Damian Greenish, chairman of law firm Pemberton Greenish, who acted for the Day family, said.
“The message of this judgment is that leasehold reform legislation is there to deal with residential property and it is aimed at people’s homes.”