Landlord and tenant – Periodic tenancy – Rent increase – Notice of increase in rent payable by respondent tenant containing wrong commencement date – Respondent challenging validity of notice – County court holding notice invalid – Appellant landlord appealing – Whether intended commencement date for increase clear to reasonable recipient of notice – Whether judge wrongly concluding rent assessment committee had no jurisdiction to determine validity of notice – Appeal dismissed
The respondent held a week-to-week tenancy of a cottage called Graigina at Llanybydder, Carmarthenshire, from the appellant landlord commencing on Monday 20 May 1991. So, the rent fell due every Monday. However, the practice of the respondent was to pay the rent on the preceding Friday of each week to ensure that it was received in time.
Section 13 of the Housing Act 1988 required that a notice to increase rent had to propose “a new rent to take effect at the beginning of a new period of the tenancy specified in the notice”. As each new period of the tenancy began on a Monday, a notice compliant with section 13 would need to propose that the new rent should take effect on a Monday.
However, the appellant sent a notice to increase the rent payable from Friday 7 December 2018, rather than Monday 10 December. The respondent did not accept the validity of that notice. She did not refer the matter to the local rent assessment committee.
The appellant issued proceedings for possession. A deputy district judge held that the notice was valid but, on appeal, Judge Beard held that it was invalid. Although one interpretation of the notice was that the increased rent was intended to take effect from Monday 10December, the beginning of a new period of the tenancy, the position would not have been clear to a reasonable recipient of the notice.
The appellant appealed to the Court of Appeal, contending that the notice was valid and effective. Further, it was too late for the respondent to challenge the validity of the notice as she did not refer the matter to a rent assessment committee.
Held: The appeal was dismissed.
(1) It was apparent from section 13 that a notice had to specify a minimum period after service of the notice before it took effect. In the present case, where a weekly tenancy had been running for many years, the minimum period was one week: section 13(2)(a) and (3)(c)). The notice here was served on 29 October 2018 and therefore gave considerably more than the minimum period of notice required.
Increases could not take place more frequently than once a year: section 13(2)(c). In the present case there had been no increase in the rent since the tenancy’s inception in 1991.
Finally, the notice had to “take effect at the beginning of a new period of the tenancy specified in the notice”. Thus, for a weekly tenancy beginning on a Monday, the notice had to specify a Monday as the date from which the new rent would take effect.
(2) The date from which the new rent would take effect was of critical importance to the validity of a section 13 notice. The date specified would enable the tenant to understand whether those statutory requirements had been complied with and would leave no room for doubt about the date from which the new rent would be payable. But it also served to specify the deadline for the tenant to challenge the proposed new rent by a referral to the rent assessment committee. That deadline was “the beginning of the new period specified in the notice”: section 13(4)). If a valid notice had been served and the tenant failed to refer the matter before that deadline, the new rent proposed in the landlord’s notice took effect without further ado.
(3) In considering whether a notice given by a party to a lease had been effective, the approach adopted in other cases had been to treat the notice as valid and effective even where it did not on its face comply with the requirements of the contractual or statutory provision in question, if it would nevertheless be understood as doing so by a reasonable recipient of the notice with knowledge of the background circumstances: Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd [1997] 1 EGLR 57; [1997] AC 749 applied.
However, a statutory notice had to fulfil the purpose for which it was to be given. Even if a notice, properly interpreted, did not precisely comply with the statutory requirements, it might be possible to conclude that it was “substantially to the same effect”’ as a prescribed form if it nevertheless fulfilled the statutory purpose. But there had to be no reasonable doubt as to what the notice was intended to say: Speedwell Estates Ltd v Dalziel [2001] EWCA Civ 1277; [2002] 1 EGLR 55 and Pease v Carter [2020] EGLR 15; [2020] 1 WLR 1459 applied.
(4) A reasonable tenant, reading the notes to paragraph 4 of the notice, would be entitled to conclude that if the date inserted in paragraph 4 was not the beginning of a period of the tenancy, the landlord had failed to comply with section 13 and the notice was invalid.
There might be cases where a mistake was so obvious that a reasonable tenant would recognise that a mistake had been made and would know precisely what the landlord had meant to say. In such a case, there was scope for the notice to be interpreted in accordance with the Mannai principle. But this was not such a case. Therefore, the appellant’s notice was invalid.
(5) It was clear that the rent assessment committee did not have jurisdiction to determine the validity of a section 13 notice. Section 40(1) of the 1988 Act conferred jurisdiction on the county court to determine any question arising under section 13 unless there was a provision of the Act which provided otherwise.
Section 14 made clear that the jurisdiction of the rent assessment committee was to determine what was an appropriate rent, having regard to market conditions and disregarding the various matters specified in subsection (2). There was no provision in the 1988 Act which conferred on the rent assessment committee jurisdiction to determine whether a section 13 notice was valid. The respondent’s failure to refer the notice to the committee did not deprive the court of jurisdiction to determine the validity of the notice: R (Morris) v London Rent Assessment Committee [2002] EWCA Civ 276; [2002] 2 EGLR 13 considered.
Forz Khan (instructed by Direct Access) appeared for the appellant; Catherine Collins (instructed by Llys Cennen Solicitors) appeared for the respondent.
Eileen O’Grady, barrister