Bankruptcy – Address for service – Section 48 of Landlord and Tenant Act 1987 – Claimants presenting bankruptcy petition in respect of unpaid rent – Claimants giving address for service in Jersey and not England and Wales as required by section 48 – Defendant claiming debt not due and payable – Whether debt to be treated as due before compliance with section 48 – Petition dismissed
On 23 June 2022, the claimants presented a bankruptcy petition in respect of the defendant, based on his failure to comply with statutory demands. The petition debt was £248,750 said to be due by way of unpaid rent payable under leases of four properties in central London.
The defendant failed to comply with a direction to file evidence in answer. A judge then ordered that unless he did so by 4pm on 17 December 2022, together with a notice of opposition, he would be debarred from defending the petition. The defendant complied with the unless order after the deadline in which he agreed the arrears, although he disputed subletting in breach of the leases and raised questions as to whether the named petitioners were in fact the landlords of the premises.
When the petition returned to court, the judge dismissed the defendant’s application for relief from sanctions emanating from breach of the unless order. The court directed that the defendant could raise only certain matters in his defence, including that the debt relied on was not due and payable by reason of section 48(1) of the Landlord and Tenant Act 1987.
Section 48 provided that a landlord of premises should by notice furnish the tenant with an address in England and Wales at which notices (including notices in proceedings) might be served on him by the tenant. Where a landlord failed to comply, any rent, service charge or administration charge otherwise due was to be treated as not being due before the landlord did comply with that subsection.
Held: The petition was dismissed.
(1) It was not in issue that notice of an address in England and Wales expressed to be given pursuant to section 48 was served on the debtor only on 6 February 2023, long after presentation of the petition.
In Dallhold Estates (UK) Pty Ltd v Lindsey Trading Properties Inc [1994] 1 EGLR 93, the Court of Appeal held that, by section 54(1) such a notice had to be in writing and might be sent by post. There was no prescribed form but it had to state that the address given was the address at which notices, including notices in proceedings, might be served on the landlord by the tenant; and it would not be sufficient to state an address which was shown to be such that, if notice in proceedings were served on the landlord at that address, it would in any particular circumstances be held to be effective service.
Section 48(1) could be given no effect in derogation of the landlord’s legal rights beyond that required by the terms of the enactment. The rent “otherwise due” was to be treated as not due from the tenant “at any time before the landlord does comply with” section 48(1); but such rent became due when the landlord so complied and continued due thereafter. The rent was due from the tenant when he received the notice.
(2) Section 48(1) required that the tenant was told, so that he knew, the landlord’s name and address in England or Wales at which he could be served with notices. If the name and address was stated in the lease or tenancy agreement without limitation or qualification, it was a necessary implication that he, or in the case of a corporation it, could be communicated with at that address and hence it was a place to which notices could be sent. The mischief at which the section was aimed was the problem created where the landlord’s identity was not known and/or the tenant did not know of an address within the jurisdiction to which notices could be sent and proceedings served.
It was implicit in section 48 itself that writing was required. It did not however require that the address given should be expressly stated to be the address to which notices should be sent pursuant to section 48 or to follow the statutory language: Rogan v Woodfield Business Services Ltd [1995] 1 EGLR 72 considered.
(3) In this case, the tenancy agreements did not give an address in England and Wales for the petitioners. They give their Jersey addresses. The proprietorship registers maintained by HM Land Registry in respect of the properties also gave the petitioners’ addresses in Jersey. The statutory demands gave the Jersey addresses of the petitioners. They also gave the address of a firm of solicitors as the address of “the individual or individuals to whom any communication regarding this demand may be addressed”. However, the address given was expressly limited to communications regarding the demand. That self-evidently could not meet the requirements of section 48.
It was not a “general” address in England for the landlord to which notices could be sent. Nor could the address printed on letter paper from solicitors in connection with the recovery of arrears, or the address given for the landlords’ agents on notices to quit, constitute a section 48 compliant notice. The provision of a solicitor’s address for service in connection with a particular set of proceedings did not imply that those solicitors were authorised to accept service of any other notice on behalf of their client.
(4) The failure to serve the section 48 notice meant that the debt could not be treated as due at the time the petition was presented. Nor was it due at some “future, certain time” as a compliant notice might never have been served. Accordingly, the later service of a section 48 notice did not cure the defect.
Section 267 of the Insolvency Act 1986 was clear that one had to look at the time the petition was presented. The court could not treat the petition as having been presented after 6 February 2023. Even if it could, the statutory demand, which was a necessary precondition to the presentation of the petition, would remain defective as it would not have been served at a time when the debt was payable immediately for the purposes of section 268 of the 1986 Act. The petitioners were not entitled to present the petition on 23 June 2022 as the debt was not due as a matter of law.
Sami Rahman (instructed by Alomo Law Solicitors) appeared for the claimants; Carlton Christensen (instructed by Lexsure Solicitors) appeared for the defendant.
Eileen O’Grady, barrister
Click here to read a transcript of Sunset Ltd and another v Al-Hindi
