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Print articleNotice to quit held to be defective in landmark Court of Appeal decision
November, 2022 - Shoosmiths LLP
Case facts
The case related to a tenant of an agricultural holding governed by the Agricultural Holdings Act 1986 which was held under an oral tenancy. The tenant, Mr Thomas, assigned the tenancy to a company however the landlord was unaware that the company existed. Mr Thomas happed to be the sole director and shareholder of the company.
Three days later, the landlord served a bare notice to quit. The landlord addressed both the notice and its covering letter to Mr Thomas and not the company. The notice was personally served on Mr Thomas at his home address which was also the registered address of the company. No counter-notice was given under section 26 of the 1986 Act and the key issue for the court was whether the notice to quit was valid, despite having been addressed to Mr Thomas (the previous tenant) rather than the company (the current tenant).
Decision
First instance and first appeal
HHJ Jarman KC, at first instance, and Zacaroli J on a first appeal both held the notice to be valid. They applied the test set out in Mannai which was whether the notice clearly conveyed an intention on the part of the landlord to require the person who was in fact the tenant to deliver up possession of the land. Both courts held that sufficient notice had been given to the company despite the landlord having no knowledge of the assignment.
Court of Appeal
In the Court of Appeal, the decision was overturned. The Court held that a notice to quit addressed to the incorrect recipient cannot be saved by the principles set out in the Mannai case. Mannai will save a notice where an intention to serve on the correct recipient is clear, such as typographical errors on the face of this notice, but not when the landlord was unaware of the assignment to the new tenant company.
The fact that Mr Thomas was the sole shareholder of the company, and that the company’s registered address was identical to the Mr Thomas’ address did not offer sufficient grounds to validate the notice.
Implications for notices
O G Thomas is an important decision for practitioners, landlords and tenants when effecting proper service of a notice to quit. It has been clarified by the Court of Appeal that the test in Mannai concerns an objective interpretation of the words used by the sender of the notice along with the background facts.
Those facts must make it abundantly clear that the notice was intended to communicate the required information otherwise that notice will be deemed invalid and could not rely on the exceptions set out in Mannai even if the error was obvious to the reasonable recipient.
A notice served on the wrong recipient is bound to be invalid.
Stuart Nevin is a Principal Associate at Shoosmiths and specialises in real estate disputes.
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