Court dismissed rent increase claim and rejected 20% reduction due to pre-1970 rent status.

[*212] 1976 May 21

(KOURRIS, S.D.J.)

IN THE DISTRICT COURT OF NICOSIA

Kyriakoullis A. Kyriakoullis,

Applicant,

and

Andreas Solomonides,

Respondent.

(Application No. 216/75).

Landlord and tenant - Statutory tenancy - From month to month since 1967 - Rent - Reduction by 20% under section 15(1) of the Rent Control Law, 1975 (Law 36/75) - Rent paid since 1967, under the Rent Control (Business Premises) Law, 1961 , same with the rent paid to-day - Section 15(1) has no application - Proviso (b) to the said section 15(1). Landlord and tenant - Statutory tenancy - Rent -

Determination - Principles applicable - Section 7 of the Rent Control Law, 1975 (Law 36/75) - "In all the circumstances" in section 7(3) of the Law - Meaning - Anomalous situation - Whether to be taken into consideration in determining rent - Evidence before the Court unsatisfactory - Application dismissed.

A. Emilianides, for the Applicant.

A. Maghos, for the Respondent.

JUDGMENT

The following judgment was delivered by:-

KOURRIS, S.D.J.: This application is based on [*213] the Rent Control Law of 1975 (Law No. 36/75), and the applicant applies for a

decision of the Court as regards the rent payable in respect of the premises.

It appears from the statement of claim that the application is based on section 7 of the said Law, and the applicant seeks increase of the rent from £55 to £75 monthly.

The respondent by his statement of defence alleges that the applicant is not entitled to an increase of the rent, and further alleges, that he is entitled to reduction of the rent by 20%, on the ground that he has been substantially affected by the emergency.

The facts as they appear on the evidence adduced from both sides, shortly, are as follows:-

The applicant is the owner of a shop by 1/4 undivided share which is situate at 182, ledras Street, Nicosiao.

The respondent is a statutory tenant from month to month at £55 rent monthly since 1967, and he is using it as a souvenir shop.

I propose to deal first, whether the tenant has been substantially affected by the emergency. On the evidence adduced, it is obvious that section

15 of the Rent Control Law, 1975 has no application [*214] because the respondent is a statutory tenant and the rent of the shop is not higher than the rent which was payable before the 31st December, 1969. The Law to be applicable for the reduction of the rent by 20%, when the tenant has been substantially affected by the emergency, the rent of the shop must be higher than the rent which was payable before the 31st December, 1 969, as the rent of the said shop was payable in accordance with the provisions of the Rent Control (Business Premises) Law. I propose to set out the said section which reads as follows:-

"15(1) During the emergency and in any event not later than 31st December, 1975 all the rents payable for immovable properties are reduced from 20th July, 1974 by 20% and the tenant as from that day will pay the reduced rent in full payment of his obligations towards towards the owner;"

"Provided that this is not applicable for any rents which on the date of the enforcement of this Law are payable according to the provisions:-"

"(a) Of the Rent Control Law which was in force before the 30th August, 1 974; or,"

"(b) Of the Rent Control (Business Premises) Law except in these cases in which the rent of the shop is higher than the rent [*215] of the shop; is higher than the rent which was payable before the 31st December, 1969; or,"

"(c)………………………………………………………………………………………..

"(d)…………………………………………………………………………………….…"

It is obvious, however, that since the rent which the tenant paid in 1967 according to the provisions of the Rent Control (Business Premises) Law, it is the same with the rent which he pays today, the Law has no application.

It now remains to be decided whether the rent of the said shop can be increased. Pausing here for a moment, I would like to set out section 7 of the Law on which this application is based:-

"(1) No increase of rent of dwelling houses or shops may be imposed on a statutory tenant except as in this Law provided."

"(2) It shall be lawful for the tenant or the landlord of any dwelling house or shop, if he considers himself to be aggrieved, to apply to the Court to determine the rent payable in respect of such dwelling house or shop."

"(3) Where such an application is made to the Court, the Court shall consider it and [*216] after making such enquiry as it may think fit, and giving to each party an opportunity of being heard, and taking into consideration all the circumstances, shall either approve the rent payable under the tenancy or increase or reduce it to such sum as the Court may in all circumstances think reasonable, and such sum determined shall be considered as the rent which the tenant must pay to the landlord."

(Translation by Court)

The Supreme Court in the case of Level Tachexcavs Ltd. v. Kyriacos Kargotis, (1970) 1 C.L.R. 169 decided that the expression "in all the circumstances" includes personal circumstances of the tenant and the landlord, including the tenant’s nature of business or work and his income there from, in addition to other relevant factors and circumstances, such as the age, character and neighbourhood of the premises, rents of comparable premises and other relevant criteria.

Josephides, J., at page 169 said as follows:-

"Considering the intention of the legislature in enacting this statute from a perusal of the whole statute, I would [*217] construe the expression ’in all the circumstances' to include personal circumstances of the tenant and landlord, including the tenant’s nature of business or work and his income therefrom, in addition to other relevant factors and circumstances, such as the age, character and neighbourhood of the premises, rents of comparable properties and other relevant criteria. This requires a subjective test; and it is a question of degree, depending on the facts and circumstances of each case, how much weight is to be given to the personal circumstances of the parties. But all relevant circumstances, including personal circumstances, must be placed in the scales of the Judge in determining what is the reasonable rent of the premises in question”

"Also the President of the Supreme Court, Vassiliades, at page 168 had this to say:-

". . . . but they also include the market value of the property and its rental value; the capital investment which it represents and its development prospects within the landlord's proprietary rights, which are put under certain limitations and certain [*218] judicial control for the sake of the general welfare of the State;"

The Supreme Court in the said case construed the expression "in all the circumstances" as this was referred to in Section 7(2) of the Rent Control (Business Premises) Law No. 17 of 1961. The said Section is almost identical with Section 7(3) of Law 36/75.

Also the Supreme Court in the case of Savvas Savvides v. Carmellos Boscovits, (1965) 1 C.L.R., 116 , held that the anomalous situation which prevailed in the Island also had to be taken into consideration in fixing the rent, and, Triantafyllides, J., as he then was, at page 125 said the following: -

"Thus, in our opinion, the trial Court had in this case to pay due regard also to the relevant effects of the conditions prevailing due to the anomalous situation which supervened since December, 1963."

Bearing in mind the principles which were laid down by the Supreme Court in the above mentioned two cases, I shall try to fix the rent on the evidence before me.

Pausing here for a moment, I would like to state that the evidence before me is not satisfactory because there is no evidence as to the income of the tenant from his work; there is, however, evidence only as to the takings from the sales of each day, but there is no [*219] evidence as to the profit he was making from such sales. Also there is no evidence with regard to the personal circumstances of the owner and the tenant, and, there is no evidence as to the capital investment which the property represents and its development prospects.

On the evidence adduced, it appears that the owner lived for about 50 years in Belgian Congo, which is now called Zair, and that his property was confiscated and left Zair in 1974, and that his income today amounts to £38monthly and pays £25rent per month for one room at "Nicosia Palace" Hotel. The owner also said that he has a sum of £1 ,600= deposited with the National Bank of Greece and that he receives £55interestper year.

The respondent in his evidence said that he has been running a souvenir shop since 1 958 and that after the invasion of Cyprus by the Turkish forces his business had been reduced by 70% because the tourism in Cyprus is minimal. He also said that various persons owe to him about £2,000 which he cannot collect because they are refugees from Kyrenia and Famagusta. He went on to say that he lost goods to the value of £600 which were in Famagusta Port (See Exh.6) and that he had also lost goods to the value of £569.725 mils which were also in Famagusta Port (See Exh.7).

The tenant testified that he and material for dresses in a bonded store in Famagusta to the value of £19,038.200 mils (See Exhs. 3,4 and 5) which he lost due [*220] to the capture of this town by the Turkish forces and that this merchandise belonged to "Solardex Ltd.” whose only shareholders were his wife and himself.

The respondent said that he owes £7,000 to the Bank of Cyprus, £2,000 to the National Bank of Greece, and the said Company owes £2,000 to the Popular Bank.

He explained to the Court that before the war he was selling articles to the value of £70-£8O per day and now his sales do not exceed £1 0-£l 5 per day.

The owner called Christos Patrikios, who is. a valuer, who assessed the rent of the said shop and said that the rent payable would be £70 per month relying on comparable rents along Ledra Street, which are set out in his reports which are Exhs.1 and 2.

The respondent did not call a valuer and said that the tenant of the shop next to his pays £43.500 mils monthly.

This is shortly the evidence before me.

On the evidence adduced, it appears that there might have been an increase of the rent of certain shops in the neighbourhood, but in order to fix the rent, this is not the only factor which must be taken into account. It is obvious that due to the emergency the sales of the tenant were reduced by 70% , and also that he lost merchandise which he had in the Famagusta Port to the value of £1,169.725 mils as well as merchandise to the value of £19,038.200 mils belonging to "Soladrex Ltd." of which [*221] the sole shareholders are his wife and himself. Also he can ot collect debts amounting to about £2,000 which are owed to him by refugees from Kyrenia and Famagusta, and, he also has debts amounting to £11 ,000.

Taking into consideration all the facts of this case, as well as the financial condition of the applicant, I reached the conclusion neither to increase the rent nor to reduce it. In the circumstances, the rent payable remains £55 per month.

In exercising my discretion, I do not propose to make any order as to costs.

Rent payable to remain

at £55.- per month. No

order as to costs.