Elizabeth Dwomoh establishes just who determines if a notice to increase rent under section 13 of the Housing Act 1988 has been validly served.
Key points
- The county court and not the rent assessment committee has jurisdiction to determine the validity of a notice served under section 13 of the Housing Act 1988
- A section 13 notice that failed to state that the proposed new rent would start at the beginning of the period of the tenancy could not be saved by the Mannai principle
The landlord of a tenant who occupies its property under a statutory periodic assured or assured shorthold tenancy can increase the rent by serving a notice under section 13 of the Housing Act 1988. A section 13 notice served using this procedure must satisfy three requirements. First, it must be in the prescribed form and specify a minimum period after service of the notice before it takes effect. Second, a landlord can only use this procedure to raise the rent once every 52 weeks. Last, the date the proposed new rent must take effect is “the beginning of a new period of the tenancy specified in the notice”. In Mooney v Whiteland [2023] EWCA Civ 67; [2023] PLSCS 24, the Court of Appeal was asked to determine whether a section 13 notice was invalid because it failed to comply with the latter.
The facts
Karen Whiteland occupied a cottage named Graigina at Llanbydder in Carmarthenshire under a periodic weekly tenancy agreement granted on 20 May 1991. The weekly rent was £25, payable on the Monday of each week. It was Whiteland’s usual practice to pay the rent on the preceding Friday.
In August 2017, Christopher Mooney purchased the cottage. In October 2018, he served on Whiteland a section 13 notice proposing to raise the rent to £100 per week. The section 13 notice was in the prescribed form. It stated that the new rent would commence on 7 December 2018 – a Friday. This was a mistake. The new rent should have become payable on Monday, 10 December 2018.
The guidance notes on the prescribed form alerted the tenant to refer the notice to the local rent assessment committee if they disputed the proposed rent. It also highlighted that the proposed new rent must start at the beginning of the period of the tenancy.
Whiteland disputed the validity of the notice. She did not refer the proposed rent to the local rent assessment committee, but continued to pay rent at £25 per week.
Mooney issued possession proceedings on the grounds of rent arrears. The question as to whether the rent had lawfully been increased was determined as a preliminary issue.
The judgments below
The principle laid down in Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd [1997] 1 EGLR 57 was applicable to this case. In summary, a statutory notice was to be interpreted so as to give effect to the way in which it would be understood by the reasonable recipient. If a reasonable recipient would appreciate that the notice contained an error and would appreciate the meaning the notice was intended to convey, then that was how the notice would be interpreted. There should not be any doubt as to what the notice was intended to say.
At first instance, the district judge found the section 13 notice was valid, but in doing so misapplied the Mannai principle. Additionally, the judge found that Whiteland had failed to refer the section 13 notice to the rent assessment committee. The decision was reversed on appeal.
The circuit judge found that the section 13 notice was invalid. Its meaning would not have been obvious to a reasonable recipient. It could be interpreted in the following multiple ways: (a) from 7 December 2018, Mooney was changing the period of the tenancy; (b) the rent was to be increased from 7 December, part way through the period of a tenancy; and (c) the date of 7 December was a mistake and it should be read as though 10 December was the start date of the tenancy.
The circuit judge also found that the rent assessment committee did not have jurisdiction under section 40 to determine the validity of the section 13 notice. Mooney appealed.
Not so obvious
The notice was found to be invalid. The Court of Appeal agreed that there were multiple ways to interpret the section 13 notice. It was not clear that it should be interpreted as if the landlord had inserted 10 December 2018 as the start date of the new rent.
In order for the Mannai principle to be invoked, the Court of Appeal highlighted that there must be no reasonable doubt as to what a notice was intended to say. A reasonable tenant, looking at the notes on the prescribed form, would have expected the proposed rent to start at the beginning of the period of the tenancy; namely Monday 10 December 2018. The landlord failed to comply with the requirements of section 13 and the notice was invalid.
Jurisdiction
There was no issue of a jurisdictional tug of war under section 40(1). Only the county court had jurisdiction to determine any question arising under section 13. Section 14 made it clear that the jurisdiction of the committee was to determine the appropriate rent.
Elizabeth Dwomoh is a barrister at Lamb Chambers
