Pease v Carter and others 2020 EWCA Civ 175

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Article

12 March, 2020

So what happens if you serve or receive a possession notice that has an error in it. Does it deem the notice invalid? Or is the recipient expected to reasonably interpret the intended meaning, if it is relatively clear?

This recent Court of Appeal case has re-enforced former case law and confirmed that the test applied to commercial notices, may also be applied to residential notices.

What were the facts?

The Landlord granted an assured shorthold tenancy ("AST") over Ivy House, Streatlam, Banard Castle on 1 August 2007 for a period of six months. After the expiry of the six-month term, the tenancy continued as a statutory periodic tenancy.

In April 2018, the Tenants had stopped paying rent, and so the Landlord served a notice to regain possession of the property on 7 November 2018. Notice was served under section 8 of the Housing Act 1988 ("Notice")

Upon serving the Notice, the Landlord had made a typographical error which indicated that the earliest date that proceedings could begin would be 26 November 2017, rather than 26 November 2018.

The Decision

At the first possession hearing, the judge applied the rule from Mannai Investments Co Ltd v Eagle Star Life Assurance Co Ltd [1997] A.C. 749. A commercial case where it was determined that notices were regarded to be valid where they were sufficiently clear and unambiguous that they would leave the 'reasonable recipient' in no reasonable doubt over how they were intended to operate.

Therefore despite the obvious typographical error, the 'reasonable recipient' would have understood the Notice as giving the tenant at least two weeks' notice before commencing proceedings and as such, the Landlord satisfied the provision and the judge ordered that the date in the Notice be amended and dispensed without the need for re-service.

The First Appeal

The Tenants appealed this and argued that the judge had no power to permit the Landlord to amend the notices.

Upon appeal to the County Court, the judge held that the even though the reasonable recipient of the notice would have realised that the intended date was 26 November 2018, the reasonable recipient test from Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd did not apply to section 8 proceedings.

The Second Appeal

The Landlord appealed this decision on the grounds that the County Court judge was wrong to hold that the 'reasonable recipient' test did not apply to section 8 notices.

In the Court of Appeal, it was held that the 'reasonable recipient' test did apply and that a reasonable recipient would conclude that the intended date was 26 November 2018.

Further, the Court considered the statutory purpose of the section 8 notice. Unlike section 21 notices, the purpose of section 8 notices was to give a tenant two weeks' notice in order to deal with threatened proceedings, for example by:

  1. Taking advice;
  2. Obtaining representation;
  3. Seeking alternative accommodation; or
  4. Paying the amount in arrears.

Given that a reasonable recipient would have understood that the intended date was 26 November 2018, the Notice did give at least two weeks' warning of the commencement of proceedings and as such the Notice was valid.

What is the significance of this decision?

Mannai concerned the interpretation of notices served under break clauses in a lease. The Court here confirmed that the 'reasonable recipient' test as set out in Mannai, applies to section 8 notices and not just to notices under break clauses in commercial leases.

Further, the Court has also made clear that for section 8 proceedings, the notice is not required to specify the date which has a particular contractual significance. Instead, the notice must have the effect of giving the tenant two weeks' notice in order to be valid for the purposes of section 8 proceedings.

Property litigators often take great care in drafting notices to terminate a residential lease under section 8 and section 21 of the Housing Act 1988. However, it now appears that in the case of section 8 notices that there is a greater focus on the intention behind the notice instead of the drafting of it.

For more information contact Jordan Davies in our Dispute Resolution department via email or phone on 0333 207 9300. Alternatively send any question through to Forbes Solicitors via our online Contact Form.

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