Service of Notices – a case comment
Written by Rebekah Putnam | Commercial Property |22nd November 2022
A recent Court of Appeal decision has highlighted how strictly the courts can view compliance with contractual and statutory conditions when serving notices.
Facts of the case
Here the tenant (Mr Thomas) lawfully assigned his oral tenancy agreement with the landlord to his new company. He had not informed the landlord of this but there was no need for him to have done so.
When the landlord served notice on Mr Thomas to quit, he addressed it to Mr Thomas rather than his company.
The High Court’s decision
When considered at the lower courts the principles laid down in a 1997 case known as ‘Mannai’ was drawn upon. The High Court in this case found that the notice should be considered in the context of whether the reasonable recipient would have understood it to have been meant for the company as the tenant under the new tenancy.
Initially, the lower courts, on the above principle, were happy to correct the mistake in the notice, on the basis that Mr Thomas would have understood the notice to be addressed to the company rather than him personally.
The tenant appealed and the Court of Appeal found a different view.
The Court of Appeal’s decision
The Court of Appeal found that in this instance it was a mistake that fell outside the scope of ‘Mannai’. The courts made the very slight distinction to the general approach in ‘Mannai’ in that although, Mr Thomas would have understood the notice should be addressed to his company, it was found that the right language was used to identify the wrong person. The principle being that it could not be inferred that a notice addressed to Mr Thomas and received by Mr Thomas, was actually meant for the company even if he would have known the company was the correct recipient. It was held that it was not legally relevant that the landlord would have served on the company had he known of the assignment and therefore this could not be used to infer any sort of intention.
Our Commercial Property team
What have we learnt from this?
Some may view this decision as harsh but there are practices that can be put in place by landlords to stop this from happening.
Where there is no restriction or provision within a lease to notify the landlord upon assignment of the lease, additional steps should be taken to ensure that any notice is served on a tenant is the correct party.
The tenancy here was an oral tenancy. The benefit of a written tenancy in this instance would have meant that each party could have had clear obligations to notify the other of any assignments so as to avoid a scenario where a lease has been assigned without the landlord’s knowledge.
The drafting and wording of a notice is crucial, and the courts can take a very a strict view and favour absolute compliance with conditions and statutory obligations of serving such a notice rather than considering the intention of the notice.
The key message here is to proceed with caution.
Speak with our Commercial Property Team
If you are considering serving formal notices or entering into a tenancy please do contact us to discuss it with you. Please contact Rebekah Putnam in our Commercial Property team on 01752 827022 or by emailing rputnam@nash.co.uk.
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