Michaels v Taylor Woodrow Developments Ltd [2000] EWHC Ch 178

Tenants claimed damages for conspiracy by unlawful means after their landlord sold property without serving required notice under the Landlord and Tenant Act 1987. The court struck out the claim, holding that breach of the Act did not support an action for conspiracy where the breach was not independently actionable.

Facts

Mr and Mrs Michaels were tenants of a flat in Harley House, London. The defendants devised a scheme to sell the freehold of Harley House to Frogmore Estates without serving the notice required under section 5 of the Landlord and Tenant Act 1987, which gives qualifying tenants certain rights when a landlord proposes to dispose of premises. The Michaels had previously litigated against some defendants in 1996, where Lloyd J found estoppel against them due to delay, and the Court of Appeal upheld this on discretionary grounds despite finding the scheme breached section 5.

Current Proceedings

The Michaels commenced fresh proceedings in 1999 seeking damages for breach of statutory duty and conspiracy by unlawful means. The breach of statutory duty claim was abandoned, leaving only the conspiracy claim.

Issues

The principal issues were: (1) Whether breach of the Landlord and Tenant Act 1987 could support an action for conspiracy by unlawful means; (2) Whether the proceedings were an abuse of process under the Henderson v Henderson principle.

Judgment

Laddie J struck out the claim on multiple grounds.

Conspiracy by Unlawful Means

The court held that not all wrongful or illegal acts will support an action for conspiracy by unlawful means. The judge stated:

“Save in exceptional circumstances, a wrongful act which is sufficient to support an action for unlawful interference with business will be sufficient to support an action for conspiracy by unlawful means and a wrongful act which is insufficient for one will be insufficient for the other.”

Citing Lord Diplock in Lonrho Ltd v Shell Petroleum Co Ltd (No.2), the court emphasised that where a wrongful act is not actionable individually, combination with others should not render it actionable except in exceptional circumstances such as conspiracy to injure with predominant purpose to harm. The court concluded:

“Where a wrongful act consists of the breach of the provisions of a statute or subordinate legislation, it will only support an action for conspiracy by unlawful means if it is determined that the intention of the legislature was that such causes of action should be available to enforce the provisions of the legislation.”

Since the Act provided specific enforcement mechanisms under section 19 but not damages for breach, Parliament was taken not to have intended such relief, and this could not be circumvented through conspiracy.

Abuse of Process

The court also found the proceedings were an abuse of process, applying Henderson v Henderson principles. The claims could have been brought in the 1996 proceedings. The sequential litigation caused unfairness to defendants, risked inconsistent judgments, and duplicated costs.

Implications

This case clarifies the limits of the tort of conspiracy by unlawful means, establishing that the unlawful means must generally be independently actionable. It confirms that legislative intent to exclude civil remedies for breach of statutory duty cannot be circumvented by pleading conspiracy. The judgment also reinforces the court’s readiness to strike out proceedings that could have been brought in earlier litigation, supporting efficient case management under the Civil Procedure Rules.

Verdict: The claim was struck out. The court held that the claimant had no arguable cause of action in conspiracy by unlawful means because breach of the Landlord and Tenant Act 1987 was not independently actionable, and alternatively that the proceedings constituted an abuse of process.

Source: Michaels v Taylor Woodrow Developments Ltd [2000] EWHC Ch 178