Landlord and tenant – Procedure – Compensation – Respondent serving statutory notices on appellant tenant relating to compulsory acquisition of building for HS2 scheme – Appellant serving counter-notices requiring respondent to acquire all buildings – Upper Tribunal determining failure to serve counter-notices within time limit fatal to claim – Appellant appealing – Whether tenancy was long tenancy about to expire – Whether time for service of counter-notice requiring recipient’s knowledge of notice – Appeal dismissed
The Saltley Business Park, Washwood Heath in Birmingham lay in the path of the proposed route of the HS2 railway. Until 2018, the appellant occupied four buildings on the park. The site of one of those buildings (Unit R) was required in connection with the new railway. The respondent secretary of state was the acquiring authority for the HS2 scheme. HS2 Ltd was the nominated undertaker for the scheme authorised to serve statutory notices on behalf of the respondent.
On 8 December 2017, notice to treat was served on the appellant under section 5 of the Compulsory Purchase Act 1965 informing the appellant of HS2’s intention to acquire Unit R, but not the others. At the same time, notice was given under section 6 of the Compulsory Purchase (Vesting Declarations) Act 1981 of the making of a general vesting declaration (GVD) including Unit R. The notices were received at the appellant’s registered office on 12 December 2017.
On 10 January 2018, the appellant served counter-notices requiring the respondent to acquire its remaining premises as well. The counter-notices arrived three days later than the 28-day period allowed by para 5 of Schedule 2A to the 1965 Act for giving a counter-notice to the notice to treat. The counter-notice to the GVD arrived on the same day.
The Upper Tribunal determined that the failure to serve counter-notices by 9 January 2018 was fatal to the claim. The appellant’s tenancy was a long tenancy which was about to expire; time began to run when the notice to treat was delivered; and the tribunal had no power to extend time: [2018] UKUT 405 (LC); [2018] PLSCS 214.
The appellant appealed. The issues were: (i) the meaning of “long tenancy which is about to expire” in section 2(2) of the 1981 Act when applied to a business tenancy protected under Part II of the Landlord and Tenant Act 1954; and (ii) whether the phrase “beginning with the day on which the notice to treat was served” in para 5(a) of schedule 2A to the 1965 Act required the recipient’s knowledge of the notice.
Held: The appeal was dismissed.
(1) The ordinary and grammatical meaning of the words used in section 2(2) of the 1981 Act referred to how long the tenancy which was granted still had to run contractually. Section 2(2) set out to define “a long tenancy which is about to expire”. The definition contemplated a tenancy which would expire at some point. The date of expiry of a tenancy was its contractual term date. It went too far to say that a tenancy protected by Part II of the 1954 Act would not expire. It might well do, if the tenant was not in occupation on the contractual termination date. In many cases, the acquiring authority would have taken possession on the vesting date so that the tenant would no longer be in occupation on that date; which was the date at which the statutory question had to be answered. There was nothing in the term defined by section 2(2) which would exclude a tenancy protected by Part II of the 1954 Act.
What was to be defined was a species of tenancy. The common law did not recognise a tenancy granted for a term of uncertain duration, suggesting that the definition was directed towards a fixed term created by contract. What was granted was what was contained in the lease or tenancy agreement; not what happened to it afterwards. Accordingly, section 2(2) referred to a tenancy “granted” for an interest greater than a minor tenancy, but having on the vesting date a period still to run which was not more than the specified period. The definition would be impossible to apply if it was necessary to assume that the expiry of the contractual term would be followed by some indeterminate period of statutory continuation.
(2) Section 2(2) was, at least in part, designed to eliminate uncertainties and its utility would be seriously diminished if the tenant’s continuing right to remain in occupation was allowed to cut across the clear statutory assumption in section 2(2)(b). It would impose an unacceptable burden on acquiring authorities if they were compelled to undertake an evaluation of whether (and if so for how long) a tenant might expect to remain in occupation simply in order to decide whether a tenancy was about to expire.
Accordingly, the appellant’s interest was a long tenancy which was about to expire within the meaning of section 2(2), so that it was excepted from the GVD and the relevant notice was the notice to treat served under the 1965 Act.
(3) Section 7 of the interpretation Act 1978 provided that service took place when the letter was delivered; and there was a rebuttable presumption that delivery took place in the ordinary course of post. Where Parliament chose a word in a statute which had a clear and consistent meaning in law, it had to be taken to have adopted that meaning. The point was all the stronger where the term was itself defined by statute: Tadema Holdings Ltd v Ferguson; [1999] PLSCS 263; (1999) 32 HLR 866, Freetown Ltd v Assethold Ltd [2012] EWCA Civ 1657, [2013] 1 EGLR 57 and UKI (Kingsway) Ltd v Westminster City Council [2018] UKSC 67, [2019] EGLR 5 considered.
(4) In the present case, it was not necessary to read down the time limit for service of a counter-notice under para 5, in the absence of some special facts. In the general run of cases in which both a notice to treat was served, and a GVD was made, a 28-day time limit for service of a counter-notice was not so short as to impair the right of access to a court. Therefore, para 5 could not be read as requiring any element of knowledge on the part of a person (still less a corporate body) who or which had actually received a notice properly delivered to them.
Timothy Morshead QC (instructed by Bryan Cave Leighton Paisner LLP) appeared for the appellant; Richard Honey and Merrow Golden (instructed by Eversheds Sutherland (International) LLP) appeared for the respondent.
Eileen O’Grady, barrister
Click here to read a transcript of Anixter Ltd v Secretary of State for Transport
