Agricultural holdings — Agricultural Holdings (Notices to Quit) Act 1977, Case D(a) in section 2(3) — Notice to quit based on failure to comply with a notice requiring tenant within two months to pay rent due in respect of holding — Elderly tenant, aged between 93 and 100, distrustful of landlord and with some disabilities of sight and hearing — Tenant had paid rent, which was due quarterly, with more or less regularity until the appellant became landlord and then payments ceased — A notice to pay rent which had become due was sent in proper form to the tenant by recorded delivery and a receipt for it had been signed by the tenant — Rent was not paid in compliance with the notice to pay and a notice to quit was served on the tenant — No notice requiring arbitration was given by the tenant — The county court judge, although finding that the appellant landlord had strictly complied with the statutory procedure, refused him an order for possession — The judge considered that it would be harsh and unconscionable to grant this relief to the appellant, who was aware of the tenant’s disabilities as to sight and understanding due to age — Held by Court of Appeal that the judge’s understandable sympathy with the tenant had caused him to fall into error — The judge had no power or discretion to grant relief to the tenant when the proper notices had been served by the landlord and no notice requiring arbitration had been served by the tenant — The procedure was not equivalent to forfeiture and relief from forfeiture — There was no room for equity to intervene — Landlord’s appeal allowed and possession ordered
This was an
appeal by the landlord, Mr Parrish, from a decision of His Honour Judge
Counsell at Hitchin County Court, dismissing the landlord’s application for
possession of a small piece of land, about 14 acres, at Chicksand,
Bedfordshire, held by his tenant, Mr Kinsey.
Andrew Gore
(instructed by Church, Adams, Tatham & Co, agents for Hooper &
Fletcher, of Biggleswade) appeared on behalf of the appellant. He was not
called on. The tenant did not appear and was not represented. K Farrow
(instructed by the Official Solicitor) appeared as amicus curiae.
Giving the
first judgment at the invitation of Watkins LJ, MAY LJ said: This is an appeal
from an order of His Honour Judge Counsell in the Hitchin County Court on
September 3 1981, dismissing the appellant’s application for possession of
certain agricultural land in Bedfordshire. The plaintiff, as he was below, now
appeals to this court against that dismissal.
In this appeal
I think that it is convenient to quote the relevant statutory provisions, and
refer to one or two authorities relating to them, before turning to the
particular facts of the case. The principal such provision is section 2 of the
Agricultural Holdings (Notices to Quit) Act 1977. That imposes certain
restrictions on the operation of notices to quit agricultural holdings. By
subsection (1):
Where (a)
notice to quit an agricultural holding or part of an agricultural holding is
given to the tenant thereof; and (b) not later than one month from the giving
of the notice to quit the tenant serves on the landlord a counternotice 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
the Tribunal consent to its operation.
Subsection (2)
provides that: ‘Subsection (1) above shall not apply in any of the Cases set
out in subsection (3) below’. For the purposes of the present appeal, we are
concerned with Case D in subsection (3), which in so far as material is in
these terms:
At the date
of the giving of the notice to quit the tenant had failed to comply with a
notice in writing served on him by the landlord, being either — (a) a notice
requiring him within two months from the service of the notice to pay any rent
due in respect of the agricultural holding to which the notice to quit relates;
. . . and it is stated in the notice to quit that it is given by reason of the
matter aforesaid.
The effect of
those provisions is shortly this: where the landlord of an agricultural holding
seeks to determine the tenancy on the ground that rent had not been paid, it is
necessary, first, for him to give the tenant a notice requiring the latter,
within two months, to pay the rent due; if the tenant fails to comply with that
notice, then the landlord may give a notice to quit; if, within one month from
the service of the notice to quit, the tenant gives a counternotice, then the
notice to quit shall not have effect unless the relevant tribunal consents to
its operation.
These
statutory provisions are precise and, subject to what will follow later in this
judgment, absolute in their operation. This is made clear in a number of
authorities to which we have been referred.
I need only
mention two of them. The first is Shepherd v Lomas [1963] 1 WLR
962. That was a case in which there was an agricultural tenancy which contained
a covenant by the tenant to keep in repair, and to repair various fixtures and
fittings (as they can be described) on the agricultural holding. The agreement
also contained a covenant by the landlord to provide his tenant with
appropriate materials to enable him to carry out some of these repairs. The
case fell to be determined under the Agricultural Holdings Act 1948 and related
to repairs, or a failure to perform them, and as to non-payment of rent. The
legal background, however, was precisely the same as that in the present case.
The landlord gave the tenant notice to carry out certain repairs on the
holding. Those repairs fell into two groups: the first, repairs which, by
virtue of the relevant covenant, the tenant had himself, without assistance
from the landlord, to carry out; the second, repairs for the carrying out of
which the tenant was entitled to receive the necessary materials from his
landlord. No such materials were, in the event, forthcoming, but also no
repairs were done by the tenant, of either of the two groups. The landlord
served a notice to quit on the ground that the notice requiring the repairs to
be done had not been complied with. The tenant served the appropriate
counternotice and challenged the notice to quit by way of the arbitration
provisions. The county court judge, on a special case stated by the arbitrator,
held that the notice to repair had not been void ab initio; that in the
light of the arbitrator’s findings, the tenant had failed to comply with the
original notice to repair; and that the notice to quit was therefore valid.
The Court of
Appeal upheld the decision of the county court judge. It is unnecessary to
refer to the judgments of the court in any detail. I merely quote short
passages from each of the three judgments.
Lord Denning
MR said this at p 971:
It follows
that in this case, although the tenant was excused from remedying the second
group of breaches (because the landlords did not provide materials)
nevertheless he ought to have remedied the first group. He was not entitled to
ignore the whole notice and do nothing. He should have got on with the part
which specified quite clearly what he should do — as indeed his solicitors in
the letter of September 29 1961 said he would do. He was given a reasonable
time to do that work and he did not do it. In those circumstances he failed to
comply with the notice and must suffer the consequences. The notice was good
and the tenant’s failure to comply with the first group was a failure on which
the landlord can rely.
Harman LJ at p
972 said:
One’s
sympathies are with the tenant here because the landlord behaved very badly. He
did not answer letters; he did not supply the timber he was asked to supply and
he was generally through his agents thoroughly dilatory in dealing with the
whole matter. If there was some relief against forfeiture which could be given,
one would be glad to do it, but this Act, unlike the Law of Property Act 1925,
is all or nothing. Either the notice to quit is good and out you go, or it is
not and you need not go.
Finally,
Pearson LJ at p 974 said:
The position
then was that there was an initially valid notice in respect of all the
breaches concerned. Then the landlords failed to comply with their obligations
to provide material for making good fences and gates. What was the effect of
that? It was plainly to disentitle the
landlords from taking advantage of their own wrong by seeking to rely upon the
tenant’s failure to make good gates and fences for the purpose of enabling the
landlords to serve an effective notice to quit. But that in my view is all the
effect which that failure of the landlords to perform their obligations ought
to have. The position remains that the tenant was at all material times and
still is in breach of his obligation to make good the hedges and ditches.
Therefore the requirements of section 24(2)(d) of the Act are satisfied,
because at the date when the notice to quit was given, on March 22, the tenant
had failed to comply with the landlord’s notice in writing within the period of
six months in so far as that notice required the tenant to remedy his breaches
in respect of the hedging and ditching. Therefore, as the requirement of
paragraph (d) was satisfied, the landlords were entitled to serve an effective
notice to quit, and they did so.
That absolute
nature of the statutory provisions in section 2 of the 1977 Act (as it now is)
was also stressed in a later case, that of Pickard v Bishop
[1976] 31 P & CR 108. That was a rent case, and opening his judgment at p
109, Lord Denning MR said this:
The
Agricultural Holdings Acts did a great deal of good for tenant farmers.
Previously they had no security of tenure. They held on tenancies from year to
year which could be determined at the end of the year by six months’ notice.
Even though they had farmed the land and lived in the house for generations,
they could be turned out. The Agricultural Holdings Acts have removed that
injustice. Every tenant farmer now has security of tenure for his life provided
that he pays his rent and farms the land properly. The farm is thus a most
valuable asset. But it is liable to be forfeited if the tenant farmer is late
for two months with his rent after it is demanded. It is necessary for the
landlord to make a proper demand. But, once given, if the rent is not paid
within two months, the tenant farmer is out. He is given no days of grace. Even
one day late is fatal. His cheque, as here, may be held up for only a day;
nevertheless the landlord can say to him: ‘Out you go, you and your family, for
ever’. The hold-up may be due to a misunderstanding with the bank, but still
the landlord can give him notice to quit. The court is powerless to help him.
The statute contains no provisions to relieve him. Equity, it is said, cannot
intervene. It is important that tenant farmers should know this to be the state
of the law.
I respectfully
comment that although the learned Master of the Rolls in the middle of that
passage spoke of the tenancy being ‘liable to be forfeited’ if the rent was not
paid, it is, as I think, quite clear from the remainder of that part of his
judgment and other cases, that to speak of forfeiture, where one is dealing
with an agricultural tenancy, is inapt. The question is whether the rent is
due; whether notice to pay has been given; whether the notice to pay has been
complied with; and, if it has not, whether a valid notice to quit has been
given.
It was against
this background that this case fell to be determined by the learned county
court judge. On February 6 1979 the plaintiff appellant bought some 17 1/2
acres of land at Chicksand in Bedfordshire. The defendant respondent, Mr
Kinsey, was then a tenant of some 14 of those 17 1/2 acres by virtue of a
tenancy agreement which had been made in 1936. That provided for payment of the
appropriate rent quarterly, on the usual quarter days in arrear. It is quite
clear that by 1979 the respondent was of a substantial age, somewhere it seems
between 93 and 100. He was, because of his age, almost deaf, and certainly he
was unable to read without glasses. It is also apparent that for the same
reason his understanding, particularly of formal documents (even if he could
properly read) was not as complete as it would have been in a younger man with
fuller capacity.
As will
appear, the respondent took a substantial part in the proceedings below. He has
not, however, appeared before us, nor has he been represented, but the court
has had the benefit of argument from Mr Farrow as amicus, who has said
everything that could be said on behalf of the defendant and has given the
court the greatest assistance.
Another
consequence of the respondent’s advancing years has been that ever since the
plaintiff bought the land of which he was tenant of part, he has been extremely
distrustful of the plaintiff and, as was quite clear when he gave evidence
before the county court judge, took the view that the plaintiff was seeking to
take advantage of him, having regard to the fact that for well over 40 years he
had been in occupation of the relevant land.
It was
possibly as a result of this distrust and dislike that, although until 1979 the
respondent had paid his rent, as he said: ‘more or less regularly’, after the
plaintiff became his landlord in 1979, he did not pay it at all. The result was
that on December 19 1979 a notice to pay in proper form, dated the previous
day, within section 2 of the 1977 Act, was sent by recorded delivery to the
respondent at his address. The usual form of Post Office receipt showed that it
was delivered at that address on December 21 1979 and that it had been signed
for by one ‘E M Kinsey’, who quite clearly is the respondent.
No counternotice
was received from the respondent seeking to refer the question to arbitration.
More importantly, no rent was paid by him, either to the appellant or to his
agents. Consequently, on February 26 1980, a notice to quit was served by the
appellant’s agents on the respondent in precisely the same way. It was
delivered by the Post Office on February 27 1980 and was signed for by the
respondent. No counternotice was served by him at any stage.
The learned
judge expressly held that the appellant had fully complied with the strict
legal procedure. In the event, in January 1982, the appellant took proceedings
in the county court against the respondent for possession.
It is
unnecessary to go into great detail about the subsequent proceedings. There was
one hearing, which the respondent sought to have adjourned. It was not
adjourned. He did not attend and judgment for possession was given in favour of
the appellant. That was on April 29 1982. Either by himself, or by some kind
neighbour or friend to whom the tenant could turn, the latter made an
application to the court on May 11 1982 to set aside the judgment for
possession. That came on for hearing on June 2 1982, when the respondent did
attend, and the learned judge on that date suspended the warrant for possession.
The proceedings were then restored on an application by the appellant in July
1982. The full hearing was on August 18 1982 and the learned judge gave a
reserved judgment, dismissing the plaintiff’s application for possession on
September 3 1982.
In the course
of that judgment, the judge expressly and correctly directed himself that he
had to determine the case according to law, and that he must not allow any
sympathy he might feel for the respondent to sway his decision. In my view,
however, the judge did, in the end, allow his understandable sympathy for this
elderly tenant, who had been there for over 40 years, and who quite clearly
took the view that his new landlord was trying to get the better of him
unfairly, to cause him to err. In subsequent passages in his judgment the judge
said this:
I accept Mr
Parrish’s evidence
that is the
appellant landlord
and that of
Mr Perks
his agent
as being
truthful and factually correct, although I have a residual feeling that there
is something I have not been told which affects this case. Their evidence was
confined strictly to the non-payment of rent and proving the notice in order to
prove the case. I feel there is some further detail to explain why this tenant
of so many years has not paid his rent to the new landlord. Notices as required
have been duly and properly served . . . While legal service may have been
affected I very much doubt if the defendant comprehended these notices despite
their form.
Then a little
later he went on
I would
further find that this distrust is something which the defendant, at his age
and background, is reasonable in thinking in his own mind, although, in fact,
it is not justified.
I think the
learned judge would have been more correct had he said that it would have been
‘understandable’ that this was in the respondent’s mind, although in fact it
was not justified.
Then, having
referred to one or two of the authorities the learned judge continued:
In the
instant case this court cannot but have an instinctive feeling that there is something
wrong with the merits of this claim which has not come out in the evidence.
Security of tenure is something to be protected where it exists in law. For my
part I understand the defendant’s case to be that the plaintiff is seeking to
take advantage of him. It is perfectly true that the plaintiff has complied
with the strict legal procedures. However, I am quite satisfied in my own mind
that the plaintiff has done so in the knowledge of the defendant’s
disabilities, as to sight and understanding due to age. I expressly exclude Mr
Perks from this finding, as he merely acted as agent on instructions.
Finally,
having discussed further authorities, among them Shepherd v Lomas,
to which I have referred, the judge concluded his judgment in this way:
For my part,
on the findings I have made, it is my considered judgment that it would be
harsh and unconscionable to grant relief sought by the plaintiff. It would be
taking advantage of an old man which I am not prepared to condone.
In presenting
this appeal, Mr Gore, on behalf of the appellant, first submitted that the
learned judge erred in law in holding that he had any discretion to refuse to
make an order for possession, given that all the necessary notices under the
statutory provisions to which I have referred, had been given. As I have
already pointed out, no question of forfeiture or relief from forfeiture can
apply in the circumstances of this case to these agricultural tenancies, and
with all respect to the learned county court judge, I accept counsel’s submission.
I think the learned judge was wrong in taking the view that notwithstanding the
strict and proper compliance with the statutory provisions, he nevertheless had
a remaining discretion to refuse to make an order for possession.
Mr Gore
further submitted that even if such a discretion did lie with the learned
judge, there was, in the first place, no evidence upon which he could reach the
conclusions of fact which he expressed in the passages from his judgment to
which I have referred. In addition, even if equity might, in certain
circumstances, be prepared to assist a tenant of an agricultural tenancy, this
should not be so on the facts of the present case.
Mr Farrow, in
his capacity of amicus, has not found it possible to argue that where
the statutory restrictions on the service of a notice to quit in section 2 of
the 1977 Act had been complied with, then there is any discretion at all in the
court to refuse to grant an order for possession; or that there are cases in
which equity could intervene, save in special circumstances where, for
instance, it may be possible to raise an equitable estoppel to debar the
landlord from pleading and relying upon the appropriate notice to pay or the
subsequent notice to quit.
Dealing also
with an important point which the court raised, Mr Farrow drew our attention to
the case of Bury v Thompson [1895] 1 QB 696. That was a very
short case. It related to a notice to quit given by a tenant to a landlord, but
in my opinion the position is the same when the notice to quit is given by a
landlord to a tenant. I need only quote a brief passage from the judgment of
Lopes LJ on the question of the validity of a notice to quit, at p 697:
A notice to
quit is a good notice if it be so expressed that a person of ordinary capacity
receiving the notice cannot well mistake its nature; it must be clear and
unambiguous.
Thus in my
opinion the mere fact (if it be a fact) that when the respondent received the
two notices in this case, because of his age his intellectual capacity was such
he did not understand them, does not affect the situation.
As Mr Farrow
pointed out, all that the landlord did in 1979 was to set in train the relevant
statutory procedures; there was nothing that required the tenant’s consent;
there was no evidence whatever that any representation, express or implied, was
made by the landlord to him which might have enabled him to invite the
intervention of equity if, as Mr Farrow put it, there was something which
‘attached to the conscience of the landlord’. In my opinion, even if equity can
in special circumstances play any relieving part in these cases, there was
certainly no scope for this in the instant case on the findings of the learned
judge.
For my part I
would wish to go further and add this, that although it may well be that the
respondent was distrustful of his new landlord, and maybe disliked him and his
agent intensely, there does not seem to me to have been any evidence before the
learned judge to support the critical views which he expressed in the course of
his judgment of the appellant landlord.
Of course no
one can but have sympathy for a man in his late nineties against whom
possession is sought of an agricultural tenancy of which he has been the tenant
for well over 40 years. In my judgment, however, the learned judge allowed that
entirely understandable sympathy to deflect him from applying to the facts of
this case the well-established principles of law. The relevant statutory
procedures were followed. There was nothing done or left undone which would
entitle the learned judge either to exercise a discretion in favour of the
tenant to whom the appropriate notices had been given, or to apply any equity
in his favour, as might have been the situation, for instance, if this had been
a case of forfeiture for non-payment of rent under the provisions of section
146 of the Law of Property Act.
In those
circumstances and for the reasons I have given, I think that the learned judge
allowed himself to be deflected by sympathy from applying clear law and that
this appeal must be allowed.
WATKINS LJ
agreed and did not add anything.
The appeal
was allowed with costs, possession being granted within 28 days.
