Joint tenancy – Notice to quit – Tenancy expiring by effluxion of time – Husband applying to set aside termination of tenancy – Whether termination of tenancy capable of being “disposition” of property
The respondents husband and his wife held a joint assured weekly tenancy of a flat in Edmonton owned by Newlon Housing Trust (the trust). In April 1995 the wife left the husband. On November 1 1995 she gave the trust notice to quit the premises expiring on December 4 1995. The effect of the notice was to bring the tenancy to an end on that date. On March 28 1996 the trust commenced proceedings for possession against the husband, who had continued to live in the flat. In the county court the husband asked for an adjournment on the ground that he proposed to make an application under section 24 of the Matrimonial Causes Act 1973 (the Act) for a property adjustment order transferring the joint tenancy into his sole name. The judge refused on the ground that the application was made too late. The husband appealed to the Court of Appeal. The joint tenancy had terminated, by the expiry of the notice to quit, six months before the matter came before the judge. An application for its transfer into the name of the husband could succeed only if it could somehow be revived. In the Court of Appeal it was conceded that this could be done by means of an order, under section 37(2)(b) of the Act, setting aside the termination of the tenancy on the ground that it was a “disposition” of property by the wife made with the intention of defeating the husband’s claim for a property adjustment order. The appeal was allowed on the grounds that the husband had a good prospect of obtaining a transfer of the tenancy and that justice required that he should be given an opportunity to pursue his application. The trust appealed. Counsel for the trust was given leave to withdraw the concession and he submitted that the termination of a tenancy by the effluxion of a notice to quit was not a disposition of property. It followed that the court had no power to resurrect the joint tenancy and accordingly there was no property in respect of which an adjustment order could be made. In those circumstances, there could be no defence to the claim for possession. The question before their lordships was therefore whether the termination of a tenancy could be a disposition of property.
Held The appeal was allowed.
1. The word “disposition” ordinarily meant an act by which someone ceased to be the owner of that property in law or in equity. Section 37 contemplated, first, that the disposition would be capable of being set aside and, second, that the beneficiary of the disposition might be able to show that he took in good faith and without notice. It was essential to the notion of a disposition of property in this context that there was property of which the disponor disposed, whether to someone else or not. It was this property which the court could restore to his estate by setting aside the disposition.
2. However, at the moment when a tenancy for a term of years terminated by effluxion of time, no property passed from the tenant. The tenant did not dispose of his interest since there no longer existed any property of which the tenant could dispose. The tenancy had ceased to exist and the landlord’s reversion fell into possession. The same was true of a periodic tenancy: see Hammersmith and Fulham London Borough Council v Monk [1992] 1 EGLR 65 per Lord Bridge.
3. The language of section 37 was clear beyond argument. If the periodic tenancy had still been in existence, the court would have had power to order its transfer to the husband. The court would express no view on whether the giving of notice would be a “dealing” with the tenancy which could be restrained under section 37(2)(a). But since it had duly expired, it could not be revived, and the husband therefore had no answer to the claim for possession.
Andrew Arden QC and Oliver Campbell (instructed by Devonshires) appeared for the appellant trust; Simon Buckhaven (instructed by Martin Shepherd & Co, of Enfield) appeared for the respondent husband.
Carolyn Toulmin, barrister
