Landlord and Tenant Act 1954, section 25 — Trial of preliminary issue treated by consent as trial of the action — Issue concerned the validity of the notice under section 25 of the 1954 Act purporting to determine the plaintiffs’ tenancy of commercial premises — The premises in question, at Winchester House, London Wall, included in the lease consisted of offices on the ninth floor and storage accommodation on two other floors together with free car-parking space — The section 25 notice, however, served by the landlords mentioned as a description of the property only the ninth-floor accommodation — The tenants, relying on such cases as Kaiser Engineers & Constructors Incorporated v E R Squibb & Sons, submitted that the notice was defective and void — It was argued by the landlords that the tenant receiving the notice must be regarded as a reasonable tenant, with a copy of his lease available, so that he would know what was comprised in his tenancy and would not be misled — Harman J rejected this submission — He agreed that the test was ‘Is the notice quite clear to a reasonable tenant reading it? Is it plain that he cannot be misled by it?’ — But he did not agree that a reasonable tenant in the present case would necessarily be free from doubt as to the scope of the notice — He might think that the landlords’ intention was to take back the office floor for some redevelopment but not the other accommodation — The notice did not pass the test applied in the authorities — Notice accordingly declared invalid
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
Hankey v Clavering [1942] 2 KB 326
Kaiser
Engineers & Constructors Inc v E R Squibb
& Sons Ltd [1971] EGD 553; (1971) 218 EG 1731; CA unreported
Safeway
Food Stores Ltd v Morris (1980) 254 EG 1091
This was a
preliminary issue directed by a master to be tried in proceedings by
originating summons brought by plaintiff tenants, Herongrove Ltd, to determine
whether a notice under section 25 of the Landlord and Tenant Act 1954 served by
the landlords, Wates City of London Properties plc, was effective. The matter
arose out of a lease for 21 years from May 1 1966 of premises at Winchester
House, London Wall, London EC.
D A Hochberg
(instructed by Slaughter & May) appeared on behalf of the plaintiffs;
Nicholas Dowding (instructed by Norton Rose Botterell & Roche) represented
the defendants.
Giving
judgment, HARMAN J said: I have before me a preliminary issue directed by
Master Gowers in May. The issue is that the points raised by para 1 of the
originating summons be tried as a preliminary issue. The originating summons
was issued by Herongrove Ltd as plaintiff on January 7 1987. The defendant was
Wates City of London Properties plc. The originating summons, by para 1, sought
a declaration that a notice dated September 8 1986, served by the defendant on
the plaintiff, purporting to determine the plaintiffs’ tenancy on May 1 1987
under section 25 of the Landlord and Tenant Act 1954, is invalid and of no
effect.
The matter
arises out of a lease granted on March 31 1966 between a predecessor in title
of the defendant and predecessors in title of the plaintiff, whereby a term of
21 years from May 1 1966 was granted. The premises demised were ‘all those
premises more particularly described in the first, second, third and fourth
parts of the first schedule hereto, hereinafter referred to as the said
premises, forming part of the building known as Winchester House’. The first
schedule to the lease has four parts to it.
Part I: ‘all
those office premises situate on the 9th floor of phase I of the building’.
Part II: ‘all
those storage premises on the lower ground floor of phase I of the building’.
Part III: ‘all
those storage premises situate on the basement floor of phase II of the
building’, and
Part IV: ‘all
those free car parking spaces on level B of the building’.
It is quite
plain, and has never been disputed, that that is one demise of one set of
premises, although in separate parts of the schedule.
The matter has
been very well argued on both sides. The notice itself is in the statutory form
under section 25 of the Act of 1954 — a Landlord’s Notice to Terminate Business
Tenancy. It is in the form which has always seemed to me quite extraordinarily
inappropriate and inapt, all drafted as if it were between two individuals
when, as is notorious, 99% of all leases of business premises are granted by
landlord companies to tenant companies. Given that difficulty, the notice is
fairly inadequate in its descriptions. The statutory form provides, in relation
to clause 2 of the notice, that it shall give a description of the property. In
this case the notice to the tenant, with the tenant’s postal address, states —
clause 2 — that it relates to ninth-floor premises at Winchester House, London
Wall.
The point
taken is at once, I think, obvious. The premises demised by the lease were the
ninth floor and two sets of storage premises and free car-parking spaces. The
storage premises, or some of them, and certainly the car-parking spaces, are
physically substantially removed in distance from the office premises on the
ninth floor.
Mr Hochberg
for the tenants cited to me Kaiser Engineers & Constructors Incorporated
v E R Squibb & Sons Ltd, a decision of the late Ungoed-Thomas J in
March 1971. The report cited was [1971] Estates Gazette Digest 553. In
that case there was an underlease of premises which included an office suite on
the ninth floor of a building, and a separate underlease of an office suite on
the fourth floor of the building, together with a flat on the ninth floor of
the building. The notice given was ‘Tenant of premises known as part of the
fourth floor’. It was held that the notice was not a good notice because,
although premises known as something may well include buildings or land which is
not strictly part of that description, but which is generally referred to by
that description, yet it was impossible to hold that that notice was clear
enough to tell the tenant what he was being asked to give up. It is in my
judgment clear, and there was no intention here of arguing the contrary, that
no section 25 notice can be given as to part only of premises comprised in a
single demise, any more than a common law notice to quit can be given as to
part only of premises comprised in a single demise.
That case went
to the Court of Appeal, where Ungoed-Thomas J’s decision was upheld by Russell
and Phillimore LJJ, Cairns LJ dissenting.
There was also
cited to me a decision of Walton J in Safeway Food Stores v Morris
(1980) 254 EG 1091, where a set of premises, formerly being five numbers in
Kensington High Street and a garage at the back thereof, had been converted
into one single supermarket and let under one lease. The notice there referred
to premises known as the ground floor and basements of the five old numbers in
Kensington High Street. The question before Walton J was whether the garage at
the back of the premises could be said to be included within the description
‘premises known as’. He held in that case, and on the facts there, that it
plainly was included, and he observed that he would have come to the same
conclusion as Ungoed-Thomas J in the Kaiser Engineering case without any
hesitation or difficulty.
The test which
I have to apply is to my mind best expressed by my former master in the law
Goulding J in Carradine Properties Ltd v Aslam [1976] 1 WLR 442,
and in particular where that most learned lawyer at p 444 between G and H says:
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 test he
derived from a series of authorities going back to 1796, and he applied it to a
notice which had given, when served in September 1974, a termination date of
September 1973. He held that it was quite plain that any reasonable tenant
reading it must have understood that 1973 was a typing error and must have
deduced that 1975 was what was intended, and therefore the notice was good. He
also referred to the well-known decision in Hankey v Clavering
[1942] 2 KB 326 and at p 445 of the report of the case concerning
learned Master of the Rolls said:
By his letter
in Hankey
v Clavering
. . . the
plaintiff, on the face of it, was purporting to determine the lease by notice
on December 21 1941.
I pause to
observe that the lease could only have been determined at Christmas Day 1941.
The whole
thing was obviously a slip on his part, and there is a natural temptation to
put a strained construction on language in aid of people who have been
unfortunate enough to make slips. That, however, is a temptation which must be
resisted, because documents are not to be strained and principles of
construction are not to be outraged in order to do what may appear to be fair
in an individual case . . .
Having so
cited the authorities, Goulding J decided that the notice in that case was a
valid notice and that no reasonable tenant reading it could have been misled.
Mr Dowding, in
a most able argument, submitted to me that it was always a test of what the
reasonable tenant would understand that was applicable to all points on the
construction of any notice, and I consider that that is sound. As it seems to
me, it is not only where there are blanks, or where there are words which are
inapt so as to amount to falsa demonstratio — which in the old words non
nocet, did no harm — that the principle applies but also where there is an
ambiguity or an inadequacy in a notice. He further submitted that the tenant
must be regarded as the reasonable tenant in the position of the actual tenant,
that is that he should be expected to have a copy of the lease available, so
that he knows what his tenancy is of, and that he must know what the actual
position on the ground is.
Mr Dowding
made those observations in answer to Mr Hochberg’s contention that this lease,
granting to the tenant the office premises on the 9th floor and the wholly
physically separate car-parking spaces in the level B, which is somewhere in
the bowels of the earth, gave to the tenant power to separate the occupations
of the two sets of property. Mr Dowding observed that that was hypothetical. It
was, of course, accurate as a proposition of possibility, but the tenant
receiving the notice would know that it was not in fact the case on the ground.
In my view, that again is sound, and one must take the tenant as standing in
his shoes, in his own premises, knowing what he has and with access to his own
lease.
Having said
all that, I return to the notice; would such a tenant, being a businessman or a
business company, receiving a notice which says that it relates to ninth-floor
premises at Winchester House, know what was meant by it? Is it ‘quite clear’ — borrowing Goulding J’s
words — ‘that it includes not only the ninth floor but also the car-parking on
level ‘B’ ‘? To my mind it is not. To my
mind, any reasonable tenant knowing his position and knowing that he had other
premises on the level B in the same building, might well say, ‘I wonder if they
are meaning to take back these offices but not to take back the car-parking and
the storage spaces. I know that there is a great deal of talk about
redevelopment of office premises. Perhaps all they want is to redevelop this
floor as a whole of which I have only a part, and that they are going perhaps
to offer me some other premises in the building and allow me to keep my
car-parking spaces.’
Of course
there is no evidence, and there could not be any evidence, that the tenant
actually thought that. There is in fact a simple, straightforward counternotice
by the tenant, as one would expect, saying that it will not give up the
premises comprised in its tenancy, as is required by the Act and following the
form of the Act. Such being the facts, it is pure speculation as to what result
this notice had upon the tenant, but I have never had any doubt since I first
looked at it that in fact this notice does not tell a reasonable tenant,
knowing the position on the ground, that he is expected to give up the whole of
his premises. It might leave him in genuine doubt as to whether he is to give
up part, that is the ninth floor, or not, and a notice that has an ambiguity of
that sort about it seems to me to be fatally flawed.
In my
judgment, therefore, for the reasons given by Goulding J in the Carradine
case citing Lord Greene, as I have already done, this notice was of no effect.
Declaration given that the notice under section 25 of the Landlord
and Tenant Act 1954 purporting to terminate the plaintiff’s tenancy was invalid
and of no effect. By consent these proceedings on the preliminary issue were
treated as the trial of the action. Plaintiff awarded costs.
