Landlord & tenant

The respondent lessor contended that the service charge provisions in the appellant lessees’ leases of chalets had the effect of providing for a fixed annual charge of £90 for the first year of the term, increasing each subsequent year by 10% on a compound basis. The county court determined the issue in favour of the appellants. That decision was reversed on appeal to the High Court, a decision which was upheld by the Court of Appeal, Civil Division. The Supreme Court, in dismissing the appellants’ appeal, held, inter alia, that despite the unattractive and alarming consequences of the annual sum of £90 being increased annually by 10% on a compound basis, it was not a convincing argument from departing from the natural meaning of the clause and involved inserting words which were not there.