Agricultural Holdings Acts 1948 and 1986 — Grant of limited right of occupation — Application of section 2 — Document purporting to be a notice to quit held to be invalid by county court judge — No counternotice served in reply — Held by Court of Appeal, reversing the decision of the judge, that the position was as follows — As a result of section 2, whether of the 1948 or 1986 Act, the occupier had acquired a protected agricultural tenancy from year to year; the disputed document was a perfectly good notice to quit; and, as no counternotice had been served by the tenant in response to it in accordance with section 26(1) of the 1986 Act, the notice became valid and effective — Appeal by landlord was allowed
were that the trustees of a deceased landlord, having recovered possession of
an agricultural holding following the death of a tenant, permitted the present
respondent to go into occupation of the farm — The terms of the occupation were
set out in an ‘acknowledgement’ by the respondent, who stated that his
occupation was limited to the lifetime of one of the trustees, that it was
personal to the respondent, that it could not be assigned and that it would
cease on the respondent’s death — It was also conditional on the payment of
£850 pa and on compliance with certain stated terms — It was not disputed at
the appeal that the effect of this arrangement was, as a result of section 2 of
the 1948 Act (in substance subsequently reproduced by section 2 of the 1986
Act), to create a protected agricultural tenancy from year to year — The
particular trustee named in this document died in 1987 and the present
appellant (the last surviving trustee) in 1988 sent the respondent a document
purporting to terminate his tenancy at Candlemas (February 2) 1989 — The nature
of this document was critical — Was it a valid and effective notice to
quit? — No counternotice in response to
it under section 26(1) of the 1986 Act had been served by the respondent — If
the document was valid, then cadit quaestio: the respondent’s tenancy had ended
below had held that the document was not a valid notice to quit — He considered
that it was defective because it failed to set out what really happened, namely
that the tenant was a protected agricultural tenant and had a right to serve a
counternotice in reply to the landlord’s notice to quit but had failed to
exercise that right — The Court of Appeal, however, agreed with the appellant’s
submission that there was no statutory requirement for the landlord to set out
the tenant’s right to serve a counternotice and the consequences of not doing
so — The court could not imply such a requirement — As far as the common law
was concerned, the landlord’s notice to quit satisfied its requirements — The
court’s correct approach was that explained in Carradine Properties Ltd v Aslam and Germax
Securities Ltd v Spiegal — The respondent’s submission that the document was
misleading as mentioning a licensee and failing to refer to the agricultural
holdings legislation was rejected — The notice to quit was valid and effective
— Appeal allowed
The following
cases are referred to in this report.
Carradine
Properties Ltd v Aslam [1976] 1 WLR 442;
[1976] 1 All ER 573; (1975) 32 P&CR 12
Germax
Securities Ltd v Spiegal (1978) 37 P&CR
204; 250 EG 449, [1979] 1 EGLR 84, CA
This was an
appeal by Rosalie E Crawford, the surviving trustee of William Graham deceased,
from the decision of Judge Forster, at Carlisle County Court, dismissing the
appellant’s claim for possession of a farm known as The Green, Irthington,
Carlisle, Cumbria, occupied by the respondent (defendant in the action), Ronald
Elliott.
Richard Gordon
(instructed by Cartmell Shepherd, of Penrith) appeared on behalf of the
appellant; John R Gregory (instructed by Hewitson & Harker, of Kirkby Stephen)
represented the respondent.
Giving
judgment, MANN LJ said: There is before the court an appeal against the
judgment of His Honour Judge Forster given in the Carlisle County Court on
December 12 1989, whereby the learned judge dismissed the plaintiff/appellant’s
claim for possession of a farm known as The Green, Irthington, Carlisle,
Cumbria. There was also an order for the payment by the plaintiff of the
defendant’s costs on scale 3. The issue in the appeal can be shortly stated. It
is whether a notice given by the plaintiff was effective to terminate the
defendant’s agricultural tenancy of the farm. I shall come to the notice later.
The background
facts can be shortly stated. The farm was a freehold belonging to one William
Graham. He, on December 31 1964, let the farm to one John Prudham on a tenancy
from year to year which was subject to the protection of the Agricultural
Holdings Act 1948 (as it then was). In 1967 William Graham died and his
property was held by the three trustees of his will, one Margaret Graham, one
Mary Graham and the plaintiff in this action, who is a solicitor. She brings
the action as the sole survivor of those three trustees. John Prudham, the
agricultural tenant, died in March 1973. Possession of the farm was recovered by
the trustees under and in conformity with the Agricultural Holdings Act.
In January
1975 the trustees of William Graham permitted an ‘occupancy’ of the farm to
Ronald Elliott, who was in fact, though it matters not, married to the great
niece of Mary Graham, one of the trustees. There was a permission and an
acknowledgement. The permission we have not seen. The acknowledgement we have
seen and it is in these terms:
I RONALD
ELLIOTT hereby acknowledge
(1) that my occupancy of the farm known as The
Green situate at Irthington, Cumbria, is based upon an equity arising from the
events which have occurred
(2) And that my right to such occupancy is
limited to the lifetime of Miss Mary Eleanor Graham and is conditional upon
(a) payment of £850 per annum by equal half-yearly
payments on 2nd February and 2nd August in each year and
(b) compliance with the terms (except as to rent
and duration) of an Agreement dated 31st December 1964 made between William
Graham and John James Prudham
AND I FURTHER
ACKNOWLEDGE that the aforesaid right is personal to me and will cease on my
death and that it cannot be assigned by me.
That
acknowledgement is dated January 27 1975.
Ronald Elliott
entered upon the farm and doubtless farmed it and doubtless paid ‘the rent’. He
became — although perhaps he did not know it and the trustees certainly did not
appreciate it until shortly before the present action was commenced — an
agricultural tenant by virtue of the Act of 1948, subsequently the Agricultural
Holdings Act 1986. Mary Graham, who was referred to in the acknowledgement,
died on December 24 1987.
On January 15
1988 the plaintiff in the action, as surviving trustee, wrote to Mr Elliott in
these terms:
You will be
aware that the death of Miss M E Graham brings to an end your occupancy of The
Green. However, it was agreed that you could remain in occupation until the
Candlemas following the expiration of one year from Miss Graham’s death. As
Miss Graham died on December 24 last, the date of vacation will be February 2
1989. I am enclosing formal Notice to Quit on that date and should be obliged
if you would sign the attached copy Notice and return this to me by way of
acknowledgement.
There is then a
paragraph which is immaterial.
What was
described as ‘formal Notice to Quit’ is in these terms:
I the
undersigned being the surviving trustee of the Will of William Graham deceased
and as such your Landlord hereby give you Notice to Quit and deliver up to me
on the 2nd day of February 1989 possession of the farm
with an acknowledgement under your hand dated 27th January 1975 and a
permission of the same date under the hands of myself and the late Mary Ellinor
Graham.
Dated the
15th day of January 1988.
It was signed
by the plaintiff.
It is that
last document which is critical to these proceedings. It is critical not only
because of the position at common law, but, more important, by reason of the
provisions of the Act of 1986. Section 2 of that Act, echoing, albeit in
slightly different language, section 2 of the Act of 1948, provides:
(1) An agreement to which this section applies
shall take effect, with the necessary modifications, as if it were an agreement
for the letting of land for a tenancy from year to year
— and I omit
certain words —
(2) Subject to subsection (3) below, this section
applies to an agreement under which
(a) any land is let to a person for use as
agricultural land for an interest less than a tenancy from year to year, or
(b) a person is granted a licence to occupy land
for use as agricultural land,
if the
circumstances are such that if his interest were a tenancy from year to year he
would in respect of that land be the tenant of an agricultural holding.
Subsection (3)
is immaterial.
It is no
longer in dispute, whatever the date of appreciation may have been, that the
instrument of 1975 was, by reason of section 2 and its predecessor, the subject
of section 2.
Under section
26 of the Act it is provided:
(1) Where —
(a) notice to quit an agricultural holding or
part of an agricultural holding is given to the tenant, and
(b) not later than one month from the giving of
the notice to quit the tenant serves on the landlord a counter-notice in
writing requiring that this subsection shall apply to the notice to quit
then, subject
to subsection (2) below, the notice to quit shall not have effect unless, on an
application by the landlord, the Tribunal consent to its operation.
Reference to
‘the Tribunal’ is a reference to the Agricultural Land Tribunal.
Even a cursory
glance at the section shows that, if there be no counternotice responding to
the notice to quit, that notice to quit can take effect according to its terms.
The notice of January 15 1988 did not provoke a counternotice. Thus if it was a
notice to quit, it can take effect according to its terms.
The learned
judge in the court below held that it was not a notice to quit. He said this —
according to the agreed notes of his judgment:
My final view,
therefore, is as follows:
1. I agree
that normally the information which is required to be given by the landlord in
the Notice to Quit is very bare and minimal.
2. I agree
there is no authority to say that the landlord must specify the statutory
rights.
3. I do find,
however (i) that the Notice to Quit completely fails to set out what really
happened here. That is that the Tenants become protected tenants and the
Defendant had certain rights which subsequently he, of course, failed to
exercise, and (ii) because of the ambiguity of language, I think that there was
a duty on the Landlord in the peculiar circumstances of this case to make it
clear what rights he was purporting to ask the Defendant to give up. This he
failed to do.
Therefore, in
those circumstances, I am not satisfied that the Notice to Quit was clear and
valid.
Mr Gordon, on
behalf of the appellant, says that a notice to quit is assailable by reference
either to a rule of common law or to a statutory provision. It may be said at
once that there is no statutory requirement in regard to the giving of a notice
to quit concerning an agricultural holding. There is no statutory requirement
that a tenant should be alerted as to the legislation or, in particular, as to
his right to serve a notice under that legislation. It is perhaps a matter for
remark that there is no legislative provision to that effect, but there is not
and this court cannot imply one.
So far as the
common law is concerned, Mr Gordon says that all that is requisite is that what
should be specified is the land to which the notice relates, that the land is
required back by the server on a specified date, and no more. If those critical
components are to be found, then what one has to do is to stand back and look
at the notice, if there be complaint about its language, and ask oneself the
question posed by Goulding J in Carradine Properties Ltd v Aslam
[1976] 1 WLR 442 at p 444G. The learned judge said:
I would put
the test generally applicable as being this: ‘Is the notice quite clear to a
reasonable tenant reading it? Is it
plain that he cannot be misled by it?’
That is a
method of approach which was adopted by this court in Germax Securities Ltd
v Spiegal (1978) 37 P&CR 204 at p 206. It is an approach which I
would propose to adopt in this case.
Mr Gregory,
for the respondent, contends that the document is misleading. He says take the
letter and the notice. They either in terms or by implication describe the
recipient as a licensee, and that express or implicit description could have
created in the mind of the reader that what the landlord intended was not a
notice to quit. Mr Gregory points out that there was no reference in the notice
or the accompanying letter to the Agricultural Holdings Act. Our attention was
drawn to the precedent books, all of which prudently do refer to the
agricultural holdings legislation. But, as I have indicated, there is no
obligation imposed under that legislation that it should be referred to.
One is left,
therefore, with what is required at common law. The components of that
requirement I have indicated. For my part I do not think, in regard to those
critical components, that there is anything in the notice or the letter which
can be described as misleading, I emphasise that there is in this case no
suggestion of bad faith or fraud, or anything of that sort.
For my part I
would regard the notice which was served as a valid notice to quit to take
effect in accordance with its terms. It took effect, in my judgment, in
accordance with its terms because the opportunity under the legislation to
serve a notice has now passed. I would allow this appeal.
SIR DAVID
CROOM-JOHNSON agreed and did not add anything.
The appeal
was allowed with costs in Court of Appeal and below. The order of court below
was set aside and possession ordered three months from November 8 1990. Leave
to appeal to the House of Lords was refused.
