Landlord and tenant — Surrender by operation of law — Tenant vacating premises and handing back keys — Landlord allowing another to reside at property for several weeks and carrying out redecoration — Landlord asserting in letters that lease continuing — Whether landlord’s conduct amounting to unequivocal acts demonstrating acceptance that lease ended
By a lease commencing in September 2004, the appellant company let a substantial and luxurious residential property, in London W14, to the respondents for a term of three years. The rent of £390,000 pa was payable by three-month instalments in advance. During the currency of the lease, the property suffered from technical problems, with the respondents complaining of defects in the central heating and the swimming pool. They decided to leave the property and, in May 2006, handed back the keys to the appellant. The lease still had 15 months to run.
The appellant brought proceedings to recover rent for the remainder of the term, plus interest, in the sum of £487,000. The respondents denied liability and contended that the appellant, by its actions, had accepted the surrender of the lease. The actions relied on included: (i) the appellant’s acceptance of the keys; (ii) the obtaining by it of a “checkout report” and inventory; (iii) certain works of redecoration; (iv) the use of the drive for parking the car of T, a beneficiary of the trust of which the appellant company was a vehicle; (iv) T’s moving into and staying at the property for a period of six weeks from June 2006.
In the county court, HH Judge Hazel Marshall QC ruled in favour of the respondents and found that the appellant had accepted the surrender of the lease from June 2006, notwithstanding subsequent solicitor’s letters in which it had asserted that the lease was continuing. The judge held that although certain of the appellant’s acts, such as the acceptance of the keys and the obtaining of the checkout report, were equivocal, its actions as a whole went significantly beyond anything consistent with the continued existence of the tenancy. The appellant appealed.
Held: The appeal was dismissed. For surrender by operation of law to take place, there must have been unequivocal acts of acceptance on the part of the landlord. That test will be met where the landlord has done something that goes significantly beyond anything consistent with the continued existence of the tenancy. T’s residence at the property for his own benefit was the key act of possession. Entering and living in a property, thereby effectively treating it as one’s own, is inconsistent with the continuance of a lease. The other findings of the judge cast evidential light on the nature of that key act. The appellant’s assertion that the lease was continuing, as stated in its solicitor’s letters, did not prevent a surrender from taking place. Surrender by operation of law does not depend on the intentions of the parties but on the doctrine of estoppel. Accordingly, the matter is judged not by the landlord’s stated intention but by the intention as demonstrated on an objective basis through its conduct as a whole. Although the burden of proof for surrender by operation of law lies with the party asserting surrender, the judge had had sufficient material before her to justify the finding that a surrender had taken place in June 2006, which was when the act of accepting the surrender and going into the property had occurred.
The following cases are referred to in this report.
Bellcourt Estates Ltd v Adesina [2005] EWCA Civ 208; [2005] 2 EGLR 33; [2005] 18 EG 150
Oastler v Henderson (1877) 2 QBD 575
Phené v Popplewell (1862) 12 CB(NS) 334
Relvok Properties Ltd v Dixon (1972) 25 P&CR 1; 224 EG 1401, CA
This was an appeal by the appellant, Artworld Financial Corporation, from a decision of HH Judge Hazel Marshall QC, sitting in Central County Court, dismissing a claim against the respondents, Marina Safaryan, Lilit Safaryan and Ambartsoum Safaryan, for rent under a lease on the ground that the lease had been surrendered by operation of law.
Michael Driscoll QC (instructed by Nasir & Co) appeared for the appellant; Nicholas Dowding QC (instructed by LG LLP) represented the respondents.
Giving the first judgment, Jacob LJ said:
[1] This is an appeal from the judgment of 16 July 2008 of HH Judge Hazel Marshall QC sitting in Central London County Court. It is about whether a landlord accepted the surrender of a lease.
[2] The appellant landlord is a British Virgin Island (BVI) company. It is the vehicle of a trust of which the wealthy Tatanaki family is among the beneficiaries. The judge found, and there is no appeal of this, that “it is the Tatanaki family which holds this company as a vehicle for the tax-efficient running of its family interests. It is the Tatanaki family, in particular Mr Fayez Tatanaki, who gives instructions concerning what is to be done with its property and whose wishes are followed in this regard. It is, in effect, permitted by Artworld to treat the property as its own, subject to the formality of it being carried out in Artworld’s name by its no doubt obliging directors.”
[3] The respondents are members of a wealthy family, the Safaryans. The subject property is a substantial residential house in Holland Villa Road. The judge described it in [3], uncontroversially, as follows:
Artworld owns the freehold of no 11/11A Holland Villas, London W14, a large and extremely well-appointed Victorian family house in a most desirable area of London. It can fairly be described as an “ambassadorial” residence, because, after being a family home for the Tatanaki family, it was… let to the Saudi Arabian Ambassador. With an “in and out” gated drive, it comprises five floors of accommodation, with living and reception rooms on the raised ground floor, a kitchen/breakfast room, study, snooker room, utility area, staff quarters and private swimming pool complex in the extended semi-basement, a master bedroom, dressing room and bathroom suite on the first floor, and two more floors of bed and bathrooms. It has underfloor heating, and a lift. To the rear are terraces at two levels, a formal garden and a staff cottage. Major refurbishment and extension took place in 1996-8. |page:28|
[4] The respondents took a three-year lease of the property, commencing on 10 September 2004. The annual rent was commensurate with the luxury nature of the property, namely £390,000 payable by instalments, three-monthly in advance.
[5] During the continuance of the lease, there were technical troubles with the property. The Safaryans said that the central heating and swimming pool did not work properly and, notwithstanding their complaints, the problems were not fixed by Artworld, as they should have been under the lease. The details of this no longer matter. It is sufficient to record that, at one point, the Safaryans were contending that the landlord’s failure to remedy the defects was so serious that they were entitled to treat the lease as repudiated.
[6] In the event, the Safaryans decided to leave the property, and did so on 4 May 2006. All keys were returned, the last of them being handed over on 30 May 2006. At that point, there were 15 months of the three-year term left. The action began with the landlord claiming the rent for the remainder of the term, a total of £487,500, which included interest. Instead of relying on repudiation, as they had been contending before, the Safaryans defended on a quite different ground, namely that the landlord had acted in such a way as to have accepted surrender of the lease. Mr Michael Driscoll QC, for the landlord, sought to make a point about that. He submitted that it was inconsistent to say that the lease had come to an end by: (a) the acceptance of repudiatory conduct; and (b) a subsequent surrender by operation of law. I just do not see any inconsistency. To decide not to rely on a belt does not prevent you from relying on braces.
[7] The judge upheld the defence of surrender, holding that the lease was surrendered in early June and before the following quarter’s rent was due. She also found for the Safaryans and their counter-claim in respect of the faulty premises during the period before they left. Although permission to appeal was sought in respect of that latter part of the judgment, it was refused on paper by Lawrence Collins LJ and has not been pursued before us. In the result, the main question before us has been whether the judge was right to hold that the lease was surrendered by operation of law.
[8] The judge saw and heard witnesses from both sides. In a careful judgment, she assessed their credibility and made findings of fact. She summarised the findings of fact that she was asked to make in [34]:
” The landlord’s acceptance back of the keys to the property.
” The landlord’s instructing and obtaining “the Check Out Report” and inventory by Mrs Walton [who had been an agent of the landlord].
” The carrying out of works of redecoration to the property to the taste of Mr and Mrs Tatanaki.
The re-hanging of certain curtains removed from the property at the Safaryans’ request.
” The removal of some garden sheds from the property.
” The return to the property of some furniture which had been taken away to storage because the Safaryans did not want it.
” The use of the drive of the property for parking Mr Fayez Tatanaki’s Rolls Royce and Mr Tatanaki’s, [that is Mr Tatanaki jnr] Porsche motor cars, on several occasions.
” Mr Tatanaki’s moving into, and staying and sleeping at the property.
” The moving into the property of some furniture for Mr Tatanaki, and in particular IT equipment and his games console.
” Mr Tatanaki’s younger sister also stayed at the property.
[9] In [70] of her judgment, she set out to deal with those various topics:
Examining the acts on which Mr Kremen relies, therefore, I find that the acceptance of the keys is an equivocal act, as is the making and handing over of the Check Out Report. The title of this document is of no significance, only its purpose. Faced with a tenant who has evinced an intention to leave the property regardless of the duration of the lease, any well advised landlord would reasonably want to record the state of the premises, and the inventory, at that time, to avoid future argument and protect his own interests. Similarly, carrying out works of repair to the property whether these were arguably required because of a breach of covenant by the landlord or by the tenant would come within the principle that the landlord is entitled to protect and preserve the fabric of his property.
[10] In her judgment, she also recorded that there had been solicitor’s letters written by the landlord in which it was asserted that the lease was continuing. Those letters she identifies in [36].
[11] I turn to the law. It was common ground that the legal test for surrender by operation of law, is essentially accurately set out in Woodfall: Landlord and Tenant. I am reading from an edition that appears to have a date of January 2007. Paragraph 17.018 says:
There is no legal distinction between a surrender by operation of law and an implied surrender. The term surrender by operation of law “is applied to cases where the owner of a particular estate has been a party to some act the validity of which he is afterwards estopped from disputing, and which would not be valid if his particular estate had continued to exist… Lyon v Reed (1884) 13 M&W 285″.
[12] There, the law treats the doing of such act as constituting a surrender. This principle does not depend on the actual intention of the parties but on estoppel. A surrender by operation of law does not depend on the intention of the parties; it takes place independently and, even in spite of intention, the foundation of the doctrine is estoppel.
[13] Most critically for present purposes is para 17.020, headed “Act must be unequivocal”:
The conduct of the parties must unequivocally amount to an acceptance that the tenancy has ended. There must either be relinquishment of possession and its acceptance by the landlord, or other conduct consistent only with the cesser of the tenancy, and the circumstances must be such as to render it inequitable for the landlord or the tenant to dispute that the tenancy has ceased.
[14] The judge, having made the finding of fact to which I have referred, said in [78]:
In my judgment, considering all the facts above, the acts of the Tatanaki family, which Artworld must be taken to have authorised, amount to much more than merely protecting the property or seeking to make the best of the Safaryans’ having departed, and go significantly beyond anything consistent with the continued existence [of] the tenancy.
The test that she applied was to look for acts significantly beyond anything consistent with the continued existence of the tenancy.
[15] Mr Driscoll was inclined to say that that was not quite right and that he preferred the formulation in Woodfall. To my mind, it makes no difference one way or the other. If the landlord has done something significantly beyond anything consistent with the continued existence of the tenancy, it will have done something that is unequivocal. Moreover, I think that the judge thought much the same because, in [68(2)], she set out the legal test in the following language:
The test is whether the landlord’s conduct is “so” inconsistent (Oastler v Henderson 1877 2 QBD 575 at 577) with the continuation of the tenant’s lease that it could only be justified as being lawful on the basis that the landlord has accepted the tenant’s implied offer to give back possession, and has taken possession of the premises beneficially for himself.
[16] I turn to the judge’s findings of fact. The most significant by far is that of Mr Tatanaki jnr moving into the house for his own benefit and not, as had been contended before the judge, as some kind of caretaker to ensure that the property was safe. Mr Driscoll accepted, as he had to, that that finding was unchallengeable. He accepted that the residence was for a period of six weeks starting in June, during which Mr Tatanaki moved in some of his own furniture, had left to go to the south of France, leaving his furniture behind, and returned for a week in October.
[17] The other findings, concerning redecoration, car parking, the return of some furniture, the rehanging of curtains and garden sheds, to my mind might well on their own not be unequivocal. Their importance is not that they are each free-standing individual acts of surrender; it is that they cast a clear evidential light on the nature of the key act of taking possession, namely that of occupation for private use for a period of effectively three months (maybe rather more, as Mr Nicholas Dowding QC pointed out).
[18] Mr Driscoll’s principal point was that the judge had overlooked the inter-solicitor correspondence. How, he asked, could the landlord |page:29| be accepting by conduct the surrender when at the same time it was positively asserting the continuance of the lease? To my mind, the judge dealt with that correctly in [42], where she said:
In my judgment the question whether there has been a deemed surrender by operation of law does not depend on the landlord’s stated intention, but on the intention demonstrated on an objective basis by its conduct as a whole. Of course this includes both what it says and what it does, and what it says may assist in interpreting the true effect of acts which might otherwise be equivocal, but it is not open to the landlord to turn black into white merely by assertion. Just as one cannot “approbate and reprobate”, where aspects of the landlord’s conduct are contradictory the court must look at that conduct as a whole, and decide what is its real effect.
[19] Mr Driscoll also attacked some of the findings of fact, but none of the crucial ones concerning occupation by Mr Tatanaki. To my mind, the only attack that really succeeded was a minor one concerning the moving back of furniture. I think that the judge may have got wrong the date on which the furniture was moved back it was later, and not at the time of the occupation by Mr Tatanaki. Success on this minor item does not, to my mind, make any difference.
[20] Mr Driscoll also submitted that the finding of fact concerning redecoration was wrong in several respects. His first submission concerning it was that it was something that the landlord was allowed to do pursuant to clause 5.24 of the lease. This reads as follows:
5.24 To permit entry
5.24.1 To permit the Landlord, the Landlord’s Agent and their workmen on reasonable written notice at reasonable hours by prior appointment except immediately in the case of Emergency using a set of keys (if necessary) to enter the Property for the purposes of:
(i) viewing and recording the condition of the Property (including during the carrying out of the Works)
(ii) repairing and maintaining or cleaning any part of the Property
(iii) complying with any of its obligations under this Agreement or for any other reasonable purpose
(iv) allowing prospective tenants to view the same during the last three months of the Term (howsoever determined) and at any time during periods of Holding Over
(v) effecting any reasonable and necessary additions alterations and improvements to the Property
(vi) removal of any items of Fixtures and Fittings previously identified by the Tenant within 7 days of the Completion Date
5.24.2 allowing prospective purchasers to view the same upon giving the Tenant fourteen days written notice and obtaining the Tenant’s consent to such viewings (not to be unreasonably withheld or delayed).
[21] Mr Driscoll said that there was some evidence that the state of decoration was poor, and that, therefore, this decoration was legitimately within clause 5.24.1(ii) or possibly (v). I do not agree. The lease as a whole entitles the tenants to redecorate the bedroom; it was their choice as to the state of the decoration while they were there, as to what colours and anything else; and, as I see it, what was done was inconsistent with the lease.
[22] Mr Driscoll pointed out that surrender by operation of law is draconian or can have a draconian effect. Here, he said, a short period of residence by just one young man, his sister for a little while and, I think, a housekeeper for some of the time at least, for a relatively short period of time would deprive the landlord of almost £500,000 worth of rent. For that reason, he submitted, and correctly to my mind, the law requires the burden of proof to lie on he who asserts surrender. Moreover, the law has a tough requirement of unequivocality, the one to which I have referred. He particularly took us to a case that he said was almost on all fours with this case, the one the judge had mentioned, Oastler v Henderson (1877) 2 QBD 575, at p577. The headnote records the facts so far as we know them. I will read it:
Plaintiffs let a house to defendant for seven years from Lady Day, 1868. Defendant entered and occupied till Michaelmas, when he left England for America. He left the keys with an agent to dispose of the house if he could, if not, to make the best bargain he could with plaintiffs for the surrender of the term. The agent was unable to find a tenant, and gave the keys in December, 1868, to plaintiffs. They employed a house agent to let the house, and he put up bills in the house and advertised it to let, but the house was not let till Lady Day, 1872, when a new tenant went in. In 1870, for a short time, some workmen of plaintiffs occupied two rooms in the house for the purpose of plaintiffs’ saddlery business.
[23] The key question before the court was whether the occupation of two rooms for a short period was enough to amount to a surrender of the lease. The report does not tell us much concerning the nature of their occupation, whether it was something that could be discontinued in a matter of moments or what was going on at all.
[24] The test that the court applied was expressed as follows by Cockburn CJ, at pp577-578. In describing the case, he says as follows:
But up to that date they had not done such an act, for they had not virtually taken possession of the premises; and in order to estop the lessors, so as to constitute a surrender by operation of law, there must be a taking of possession. I do not say a physical taking of possession, but, at all events, something amounting to a virtual taking of possession. But here there was no such taking of possession.
And he said this concerning the taking of the rooms, at p578:
As for the fact that the plaintiffs’ workmen used two of the rooms in 1870, I do not think that any jury ought to hold that to be equivalent to a taking of possession, for it is, under the circumstances, quite consistent with an intention to hold the defendant to his lease.
Bramwell LJ, clearly evincing a lot of sympathy for the landlords, pointing out that it was unoccupied and bringing in no rent, regarded the fact that the rooms were used as simply a natural thing for them to do in circumstances where they thought the defendant was not going to return. Brett LJ simply expressed it this way, at p580:
The plaintiffs’ workmen, were, it is true, let into two of the rooms for a time, but that was not by way of taking possession.
[25] It is always dangerous to argue on the facts of one case to the facts of another. The judge in this case had much more material to work on than is indicated in Oastler. The question that I ask myself in the end was, did she have material on which to come to the finding that there had been a surrender? To my mind, the answer is clear: she did. Going in and living in the property is, in effect, taking it over and treating it as one’s own, which is inconsistent with the continuance of a lease. Accordingly, on the main part of the appeal, I would hold that the judge was right.
[26] The final live point was about the date of surrender. Mr Driscoll submitted that since Mr Tatanaki went into occupation only in early June, one could not say that there had been a surrender by the next rent day, which was a few days later. It is only when one sees what has happened over the period of the next three months that one can say that there has been a surrender. Again, I do not accept that argument. The better way to look at it is that the act of accepting the surrender and going in happened in June. The period of occupation is a reflection of that taking back of possession. So, I see no fault in the judge’s reasoning here either.
[27] In the result, I would dismiss this appeal.
Giving the second judgment, Dyson LJ said:
[28] I agree that this appeal should be dismissed. The meaning of the doctrine of surrender by operation of law is not in doubt. It was well summarised by Peter Gibson LJ in Bellcourt Estates Ltd v Adesina [2005] EWCA Civ 208; [2005] 2 EGLR 33, in these terms, in [30]:
The doctrine of surrender by operation of law is founded on the principle of estoppel, in that the parties must have acted towards each other in a way which is inconsistent with the continuation of the tenancy. That imposes a high threshold, which must be crossed if the tenant is to be held to have surrendered and the landlord is to be held to have accepted the surrender.
There is reference in some of the authorities to the circumstances having to be such as to render it “inequitable” for the landlord or tenant to dispute that the tenancy has ceased: see, for example, Bellcourt, in [19] to [21] in the judgment of Longmore LJ. However, I would accept the submission of Mr Dowding in his skeleton argument, in para 15, where he says that the references: |page:30|
are not to be read as importing inequity as a separate requirement. The doctrine is not based on conscience. Where possession is unequivocally offered and retaken, it will, without more, be inequitable for the landlord to deny that the tenancy has ended, because he cannot at one and the same time have both possession and continuing rent under the tenancy. That is clear from (amongst other things) Aldous LJ’s description, in McDougalls Catering Foods v BSE trading [1998] 2 EGLR 65 of the court’s task as being to ascertain from all the facts whether the landlord’s conduct:
“did in fact amount to an unequivocal acceptance of cessor of the tenancy such that it would be inequitable for the landlord to dispute that the tenancy ceased”. [emphasis added]. In other words, the two are the same thing.
[29] In my judgment, the propositions derived by the judge from the authorities and stated in [68] of her judgment are correct:
(1) The issue of whether there has been a surrender by operation of law after a tenant’s abandonment of the leased premises must be determined by evaluating the effect of the landlord’s conduct as a whole (cf London Borough of Brent v Sharma (1992) 25 HLR 257 at 259). I accept Mr Kremen’s argument that the totality of such acts can amount to a resumption of possession even though individual acts might each be only equivocal. With this in mind
(2) The test is whether the landlord’s conduct is “so” inconsistent (Oastler v Henderson 1877 2 QBD 575 at 577) with the continuation of the tenant’s lease that it could only be justified as being lawful on the basis that the landlord has accepted the tenant’s implied offer to give back possession, and has taken possession of the premises beneficially for himself.
(3) Accepting back the keys without more will always be equivocal. As a matter of practicality and common sense, one party has to hold the keys to prevent an absurd situation in which they are passed back and forth because neither party wants to risk it being suggested that it has made an admission by holding them.
(4) Any act of the landlord which is consistent with its rights under the lease, such as entering the premises to inspect or to repair them, will not in itself give rise to a surrender because, by definition, it is not inconsistent with the lease continuing.
(5) Any further act of the landlord which amounts to protecting or preserving the property, such as taking security measures or doing necessary repairs, will not in itself give rise to a surrender because such self-help, necessary to preserve the landlord’s interest in the value of his property, is a reasonable response to the tenant’s evinced intention not to perform the obligations of the tenancy: cf McDougall’s Catering Foods Ltd v BSE Trading Ltd 1998 P&CR 312; Relvok Properties Ltd v Dixon (1972) 25 P&CR 1, at p7.
(6) Similarly, any act of the landlord which amounts to the landlord’s performing the tenant’s covenants under the lease, such as keeping the garden tidy, would not necessarily amount to a resumption of possession as it is not inconsistent with holding the defaulting tenant to performing the lease.
(7) Any further act of the landlord referable to the landlord’s seeking to re-let the premises will not necessarily give rise to a surrender by operation of law, as it is no more than what the landlord might reasonably be expected to do in the circumstance for the potential benefit of all parties: Oastler v Henderson (above). The landlord must be entitled to seek to mitigate the damage caused in reality (even if not yet technically in law so long as the lease remains extant) by the tenant’s abandoning the lease, by seeking to obtain another tenant, without thereby losing his rights against the original tenant if he is unable to do so.
(8) However, if the landlord goes further and uses the premises for his own benefit beyond the totally trivial and certainly, in my judgment, if such use amounts to occupation of the premises then he re-takes possession of the premises inconsistently with the continuance of the lease. This will give rise to a surrender by operation of law, since it is only on the basis of having accepted such a surrender that the landlord’s acts would be lawful.
[30] Mr Driscoll criticised proposition (1), but again the answer to this is provided by Mr Dowding when he pointed out that the judge went on to accept the tenant’s submission that the totality of the landlord’s conduct can amount to an acceptance of possession even though the individual acts might each only be equivocal. The court must look at the cumulative effect of the acts relied on. If taken together they amount to a resumption of possession, that is enough, even though, viewed in isolation and without regard to the others, each might be capable of being explained away; each case will depend on its own facts.
[31] Mr Driscoll also criticised proposition (8), but, yet again, I will accept the submission of Mr Dowding that this proposition must be read in the light of the judge’s propositions (3) to (7), none of which is disputed. What the judge was saying was that a landlord that goes beyond the sort of acts referred to in propositions (3) to (7) and uses the premises for its own benefit and, a fortiori, a landlord that goes into occupation of the premises for its own benefit is ordinarily to be treated as having retaken possession. This accords with the distinction drawn by Wills J in Phené v Popplewell (1862)12 CB(NS) 334 between “[acts] done in the exercise of ownership” and “mere gratuitous acts done for the benefit of the tenant” and also with Relvok Properties Ltd v Dixon (1972) 25 P&CR 1*, in which Sachs LJ identified the question as being “whether in any individual case the landlord has done more than protect his interests”. However, the judge’s proposition correctly recognises that not every instance of use of the premises by the landlord for its own benefit will necessarily amount to a retaking of possession, even where such use goes beyond the sort of acts referred to in the judge’s propositions (3) to (7). The use that is too trivial will not suffice. I would agree that that is correct.
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* Editor’s note: Also reported at (1972) 224 EG 1401
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[32] In [69], the judge said that the principle of surrender by operation of law is more accurately viewed as a case of election than of estoppel. Mr Driscoll submitted that she was wrong to do so. However, a landlord that is faced with a tenant that vacates and returns the keys is faced with a choice that may aptly be described as an election. All that the judge meant was that once the landlord has elected to retake possession, the surrender is complete. She went on to say, in [69]:
Having deliberately taken that of acting in a manner undeniably inconsistent with the continued existence of the estate which he has granted, he has elected to treat that estate as determined in accordance with the offer to relinquish it made by the tenant, and cannot thereafter change his mind.
In my judgment, that is a proper approach to the issue of surrender by operation of law.
[33] Mr Driscoll rightly conceded that the central and crucial finding of fact is a finding that the landlord took possession of the property in a manner, and to an extent, that was inconsistent with the continued existence of the tenancy. He accepted, rightly, that he cannot challenge the finding that Mr Tatanaki jnr did not occupy the property as a caretaker. The judge was clearly entitled to make the findings that she made in [76], to which Jacob LJ has already referred. I should point out that he said that the finding was that Mr Tatanaki jnr was in occupation only for one week in September 2006. I do not believe that the judge actually made a finding as to the duration of Mr Tatanaki jnr’s occupation of the property. It is pointed out, in his skeleton argument, by Mr Dowding that the two witness statements of Ms Marina Safaryan state that she saw Mr Tatanaki jnr in June 2006 and that she visited the property on subsequent occasions in October and November, when Mr Tatanaki jnr was in residence and had his belongings and furniture there and a housekeeper living with him. It would appear, therefore, that the occupation was rather more extensive than my lord has indicated. The precise length of it, however, is not disclosed by the material that has been shown to us and has certainly not been the subject of any finding by the judge.
[34] Mr Driscoll has two particular points of criticism of the judge’s overall conclusion, in [78], to which again Jacob LJ has referred. First, he submitted that the judge failed to take into account the correspondence after the beginning of June 2006 in which the landlord denied the tenant’s allegation of repudiatory breach of the agreement and continued to claim rent. Jacob LJ has already referred to the passage in [42] of the judgment, in which the judge dealt in general terms with the relevance of what a landlord or a tenant may say when the issue of surrender implied by law is under consideration. In my judgment, what the judge said in general terms about that in [42] is beyond criticism. It is true that the judge did not refer specifically to the correspondence in her examination of the facts in [70] to [77], and Mr Driscoll submitted that that amounted to an omission of a material consideration. In my judgment, the judge should have made specific reference to the correspondence at that point in her judgment, since it was a point relied on by the landlord, but it is clear that had she referred |page:31| to that correspondence she would have reached the conclusion that she reached in any event. She was plainly of the view that the landlord’s acts, taken as a whole, were inconsistent with the continuation of the tenancy. It is inevitable that she would not have decided that this was all changed by the correspondence, particularly in the light of her general direction to herself in [42], which, as I have already said, was entirely correct.
[35] Second, Mr Driscoll challenged each of the findings and conclusions of the judge in [71] to [77], as I understand it, apart from the findings concerning the occupation of Mr Tatanaki jnr and, in particular, it not being referable to his being in the property as a caretaker. Mr Driscoll submitted that the findings that he challenged were not supported by the evidence. In my judgment, there is no basis for this wholesale attempt to overturn every finding of primary fact and each evaluation made by the judge on these points.
[36] The essential point is that the landlord did redecorate the main bedroom, did rehang the curtains and did reinstate some, at least, of its furniture. These acts were relevant to an assessment of the quality of Mr Tatanaki jnr’s occupation, and the judge was entitled to rely on them in support of her conclusion. The landlord’s acts, taken as a whole, went significantly beyond anything consistent with a continued existence of the tenancy.
[37] In summary, in my view, the judge did not misdirect herself as to the correct test to be applied. Her application of that test was not flawed. She was entitled to reach the conclusion that she reached. I would therefore reject grounds 1 and 2 for these reasons, as well as those given by Jacob LJ. I have nothing to add on ground 2.
Giving the third judgment, Sedley LJ said:
[38] No doubt a lessee cannot succeed simultaneously on repudiation and surrender, but they are perfectly intelligible alternatives and that is how they were run here. As my lord has indicated, part of Mr Driscoll’s argument involved a critique of [69] of the judgment:
Although surrender by operation of law may be described in the language of estoppel, to which it bears some resemblance, this is really in the context of indicating the distinction of the acts which do amount to a resumption of possession, and acts which are viewed as being too trivial to do so. In my judgment, the principle is more accurately viewed as a case of election.
[39] It does not matter, it seems to me, whether one uses the label “estoppel” or “election” to describe the process by which the lessor may turn abandonment by the tenant into a surrender of the tenant’s estate. What matters is that there should not be found to have been a surrender by operation of law unless what the lessor has done in response to the tenant’s departure is consistent only with treating it as a surrender of the term. The decision in Oastler both enunciates and illustrates this proposition, but it does not act as some kind of a factual precedent or benchmark for future cases, all of which will in the nature of things differ in their facts.
[40] The judge, it seems to me, asked the right questions concerning surrender and reached an answer that, on the evidence, was perfectly tenable. She did not ignore the correspondence, but she rightly proceeded on the footing that the lessor’s insistence in it on the continuation of the tenant’s obligations had to be matched against what had actually happened, and what had happened was legitimately characterised by the judge as a resumption of possession.
[41] As Mr Driscoll recognised, an unqualified resumption of possession by or with the authority of the lessor, whether by reoccupation or reletting, is inconsistent with the survival of the tenancy. Indecisive or ambiguous acts, by contrast, will not be. The judge was, in my view, entitled to find here an unambiguous resumption of possession by the lessor.
[42] It is in such a context that such acts as redecoration lose what would otherwise be their neutrality. Whether they amount simply to maintenance or give colour to the act of repossession is likely to depend, as it did here, on the larger findings about what the lessor has done in response to the lessee’s departure. That is how the judge approached them.
[43] Last, I would like to express what I know is the appreciation of all members of the court of Judge Marshall’s well-composed and well-reasoned judgment.
[44] I too would dismiss this appeal.
Appeal dismissed.
