Lease – Business premises – Possession – Landlord purporting to exclude statutory continuation from terms of lease – Landlord failing to use prescribed form of statutory declaration – Judge making order for possession – Whether judge erring in finding statutory provisions excluded – Appeal dismissed
In March 2005, the respondent granted the appellant leases of two shops on the concourse of Marylebone Station in London. Each was for a term expiring on 17 July 2006 and excluded sections 24 to 28 of the Landlord and Tenant Act 1954.
By section 24, such a business tenant had a right to apply to the court for a new tenancy, which could be refused only on specified grounds, some of which carried a right to compensation from the landlord. Section 24 also provided that a business tenancy should continue past its contractual term date unless and until determined by a notice that complied with the requirements of sections 25, 26 and 27. By section 38A(3) of the 1954 Act, an exclusion agreement was void unless the landlord had served the tenant with a notice in the form set out in Schedule 1 to the Regulatory Reform (Business Tenancies)(England and Wales) Order 2003 and the requirements specified in schedule 2 to that order.
The form of notice in Schedule 1 explained that the tenant was relinquishing her rights under the 1954 Act and emphasised the importance of obtaining professional advice. Paragraph 2 of Schedule 2 to the 2003 Order said that the notice referred to in section 38A(3) had to be served not less than 14 days before the tenant entered into the tenancy. Under para 3, before entering into the tenancy, the tenant had to make a declaration in the form set out in para 7. Should a notice be served on the tenant less than 14 days before the tenancy was granted, the tenant had to make a statutory declaration in the form set out in para 8.
In the present case, the respondent served the appellant with the mandatory notice after the 14 day time limit and a declaration was purported to have been made under para 8. When the leases expired, the respondent sought possession of the properties. The appellant sought a declaration that sections 24 to 28 had not been validly excluded from the leases since the respondent had erred in making a declaration under para 8 rather than para 7. The judge held that the relevant sections of the 1954 Act had been validly excluded and made a possession order in favour of the respondent. The appellant appealed.
Held: The appeal was dismissed.
A declaration made by the respondent landlord in the form of para 8 of Schedule 2 to the 2003 Order constituted “a declaration in the form, or substantially in the form, set out in para 7” of the 2003 Order since para 8 required the tenant to “solemnly and sincerely declare” rather than merely “declare” as under para 7. It would be bordering on the absurd if a statutory declaration were held to be ineffective on the grounds that it differed from the prescribed form because it was expressly and in law in a more solemn form. However, the converse could not be true because a para 7 declaration would not provide a tenant with the protection afforded by the more formal declaration under paragraph 8.
Moreover, in its statutory and commercial context, it could not be said that the making of a statutory declaration in accordance with para 8 rather than the form prescribed by para 7 resulted in any of the essential purposes of the prescribed form being thwarted or even significantly blunted.
Salim Merali, solicitor-advocate (instructed by S Merali & Co) appeared for the appellant; Alexander Winter (instructed by Hollingworth Bissell) appeared for the respondent.
Eileen O’Grady, barrister
