Tenancy – Oral agreement – Order for possession – Landlord and tenant sharing property – Landlord supplying rent book at start of tenancy – Rent book describing tenant’s occupation as assured tenancy – Executors seeking possession of property on landlord’s death – Whether tenancy qualifying as assured shorthold tenancy – Appeal dismissed
From May 1999, the appellant was the tenant of a flat under an oral agreement between himself and H, a 91-year-old man, who owned the building and occupied the basement flat. Before he took up residence, the appellant was provided with a rent book by H, the front cover of which contained the words “assured tenancy”. The appellant helped H with domestic chores and handled some of his financial affairs after being granted joint power of attorney with H’s daughter (the second respondent). The appellant also purchased a car parking space at the back of the property from H for £1,500. H died in November 2001 and, in June 2005, the respondents, as executors of his estate, served on the appellant a notice, under section 21 of the Housing Act 1988, purporting to end his tenancy as an assured shorthold tenant. The appellant argued that his occupation was under a non-shorthold assured tenancy so that the notice seeking possession had no lawful effect.
Under section 19A of the 1988 Act, an assured tenancy was an assured shorthold tenancy unless it fell within one of the exclusions in Schedule 2A to the Act. The county court held that the appellant was a non-shorthold assured tenant since the rent book represented a notice within paras 1 or 2 of Schedule 2A, which reflected the agreement of the parties to give the appellant security of tenure on a long-term basis.
The respondents’ appeal was allowed and an order for possession made. The judge held that the rent book did not contain the required statement pursuant to paras 1 and 2 of Schedule 2A and was not intended to be a notice directed at those provisions. Moreover, the parties’ intentions, as found, that the appellant could live in the flat as long as he liked could not overcome the lack of prescribed notice. Furthermore, para 3 of Schedule 2A did not apply since it clearly required a specific provision to the effect that the tenancy was not an assured shorthold tenancy in a written agreement. Even if it could refer to an oral agreement, the facts were insufficiently clear to justify a conclusion that the presumption of an assured shorthold tenancy was to be excluded. The appellant appealed.
Held: The appeal was dismissed.
The rent book in the form used in the present case was not a notice within paras 1 or 2 of Schedule 2A to the 1988 Act. The statement on the cover “assured tenancy” was not a statement “that the assured tenancy to which it related is not to be an assured shorthold tenancy” within para 1(2)(c). If there was any doubt about that, the schedule to the rent book confirmed that the expression “assured tenancy” on the first page was not confined to non-shorthold tenancies. The reference to a notice being served in para 1(1) of Schedule 2A was to service of a written notice. It was clear that the rent book was intended as and used to simply record the payment of rent: MacDonald v Fernandez [2003] EWCA Civ 1219; [2003] 3 EGLR 22; [2003] 42 EG 128 considered.
Furthermore, para 3 of Schedule 2A was directed to written agreements with a provision to the effect that the tenancy was not an assured shorthold tenancy. The structure of Schedule 2A and the place of para 3 in that structure supported the conclusion that para 3 required a document containing or evidencing a provision to the effect there stated. Even if the rent book evidenced an oral agreement, it contained no such provision.
However, the court had not heard full argument on that important point and it was not necessary to decide it since, even if an oral agreement was, in principle, sufficient to engage para 3, the finding by the district judge that it was orally agreed that the appellant should have security of tenure on a long-term basis was not sufficient in the circumstances of this case to engage para 3.
Bruce Speller (instructed by Holden & Co, of Hastings) appeared for the appellant; Mukhtiar Otwal (instructed by Downs, of Dorking) appeared for the respondents.
Eileen O’Grady, barrister
