Byrnlea Property Investments Ltd v Ramsay
| Jurisdiction | England & Wales |
| Judge | THE MASTER OF THE ROLLS,LORD JUSTICE EDMUND DAVIES,LORD JUSTICE PHILLIMORE |
| Judgment Date | 26 February 1969 |
| Judgment citation (vLex) | [1969] EWCA Civ J0226-2 |
| Court | Court of Appeal (Civil Division) |
| Date | 26 February 1969 |
[1969] EWCA Civ J0226-2
In The Supreme Court of Judicature
Court of Appeal
The Master of the Rolls (Lord Denning)
Lord Justice Edmund Davies and
Lord Justice Phillimore
Appeal by Mr. Ramsay from the judgment of Judge Ifor Lloyd at Wandsworth County Court on 30th May, 1968.
In the Matter of the Leasehold Reform Act 1967
and
In the Matter of property known as 33, Byrne Road, Balham, London, S.W. 12.
Mr. FREDERICK SUCH (instructed by Messrs. W. Timothy Donovan) appeared on behalf of Mr. Ramsay.
Mr. J.S. COLYER (instructed by Messrs. Gilbert Samuel & Co.) appeared on behalf of Byrnlea Property Investments Ltd.
We are here called upon to consider the provisions of the Leasehold Reform Act 1967. This Act confers on sitting tenants of long leaseholds a right to buy the freehold at a fair price, or, alternatively, to get an extra 50 years' lease at a fair rent. But this case concerns a long leasehold which had expired two years before the Act was passed. It comes under the transitional provisions of the Act, which impose a stringent time limit.
The house is No. 33 Byrne Road, Balham. The lease was for 99 years, expiring on 30th June, 1965. The ground rent was £7 10s. 0d. a year. Mr. Ramsay, who comes from Guyana, bought the leasehold in 1958 for £850. It had seven years then to run. He lived there with relatives, also from Guyana. On 30th June, 1965, the lease came to an end, but he stayed on under the provisions of Part I of the Landlord and Tenant Act, 1954. His tenancy was thus continued by Statute. This continuation of the tenancy was determined, so the Judge found, by a surrender and grant of a new tenancy from year to year at £8 8s. 0d. a week (£436 16s. 0d. a year). This was granted by way of continuation of the former long tenancy. It was to be treated, therefore, under the transitional provisions, as a long tenancy at a low rent for the purpose of the Leasehold Reform Act, 1967, see Section 34(1)(a). He had occupied the house as his residence for more than five years. So he was entitled to acquire the freehold or an extended lease: provided that he gave the prescribed notice within the prescribed time. I say "within the prescribed time" because, in these transitional cases, where the term of the lease had expired before the Act was passed, Section 34 sets a time limit The prescribed notice must be given before 28th January, 1968. It cannot be given afterwards. This is clear from Section 34(2) which says:
"A notice of a person's desire to have the freehold or an extended lease of a house and premises, if given by virtue of sub-section (1) above (which allows it when a long tenancy has been continued after its expiry date as here) -"may be given before the appointed day (let January 1968) but shall be of no effect if given more than three months after the day this Act is passed (27th October, 1967)".
Mr. Ramsay followed keenly the passing of the Bill through Parliament. Two days after the Act was passed, on 29th October, 1967, he gave this notice to the reversioner: "Sir, now that the Leasehold Bill becomes law, I hereby serve notice on Byrnlea Property Investments Limited that I wish the enfranchisement of 33 Byrne Road, Balham, S.W.12".
A month later, on 29th November, 1967, he gave another notice to the reversioner: "Sir, I was hoping to receive a reply to my letter dated 29/10/1967. Anyhow I am sending a reminder. Now that the Leasehold Bill becomes law, I hereby serve notice on Byrnlea Property Investments Limited, that I wish the Freehold of 33 Byrne Road, Balham, S.W.12".
Those two notices would seem at first sight to be good enough: but they did not contain the particulars required by Schedule 3 of the Act (i.e. particulars of the tenancy, etc). They were, therefore, not sufficient to satisfy the Act, see Section 34(4)(a). That is accepted by Mr. Ramsay's counsel.
After the appointed day, 1st January, 1968, the tenant's notice had to be "in the prescribed form", sec Schedule III, Clause 6(1). So on 3rd January, 1968, Mr. Ramsay obtained a printed form and served it on the reversioner. It said: Delete whichever is inapplicable. Take notice that I as tenant of the house and premises described in the Schedule hereto, desire to have (the freehold or an extended lease) of the said house and premises. I am making my claim in exercise of my rights under the Leasehold Reform Act, 1967. The particulars on which I rely are set out in the Schedule to this notice".
Mr. Ramsay set out all the required particulars in the Schedule. There were some errors in his particulars but these could be overlooked, see paragraph 6(3) of the 3rd Schedule. But, in addition, he made a serious mistake in the body of the notice.He left the phrase intact: "The freehold or an extended lease". He did not follow the advice in small print in the margin: "Delete whichever is inapplicable". He did not delete either of them.
The landlords must have noticed that he made a mistake. But they did not tell him about it. They waited until after 28th January, 1968, so that it was too late for him to correct it. Then on 30th January 1968, they put in a notice of objection, saying: "You do not specify in your notice whether you require the freehold or whether you require an extended lease".
They knew, of course, perfectly well from his earlier letters that he wanted the freehold and not an extended lease. The Judge so found. And it is apparent that they knew, because on the same day, 30th January, 1968, they wrote a letter saying: "We are applying to the Wandsworth County Court for a declaration that you are not entitled to the freehold," and they actually took out an application to determine "whether the respondent is entitled to have the freehold".
In reply, Mr. Ramsay, on 31st January 1968, made it quite clear that he wanted the freehold. He said: "We know that we are entitled to the Freehold as defined in Section 1 of the Leasehold Reform Act, 1967".
Nevertheless, although the landlords were not in the least misled - they knew he wanted the freehold - they contend that his notice was invalid because he did not delete on the form one or other - "the freehold or extended lease" - but left the phrase intact. The Judge upheld this contention. He said that "the notice sent to the landlords by Mr. Ramsay on 3rd January 1968, was bad for ambiguity and for non-compliance with the form prescribed by the Act and Regulations".
This raises an important point. I think that a notice, to be good, must be in writing; and it must make it clear whether the tenant is claiming the freehold or whether he is claiming an extended lease. He cannot claim both. He cannot claim one orother. He must claim one only. The reason is because, on the giving of a notice, the parties are bound as effectually as by a concluded contract. Section 5(1) says in terms that: "When a tenant of a house has the right to acquire the freehold or an extended lease, and gives notice of his desire to have it, the rights and obligations of the landlord and tenant arising from the notice shall inure for the benefit of and be enforceable against them, their executors, administrators and assignees to the like extent (but no further) as rights and obligations arising under a contract for a sale or lease freely entered into between the landlord and tenant".
There is, therefore, as soon as the notice is given, a statutory contract binding on the landlord and tenant. And the Statute makes provision for all the terms of this contract. If the tenant gives notice of his desire to have the freehold, the landlord is bound to grant him an estate in fee simple on the terms and conditions set out in the Act (Section 8 to 13) and in the Regulations (Part I of the Schedule). If the tenant gives notice of his desire to have an extended lease, the landlord is bound to grant him a new tenancy on the terms and conditions set out in the Act (Section 14 to 16) and in the Regulations (Part 2 of the Schedule).
Once the notice is given, both parties are bound just as they are by an ordinary contract. Neither can get out of it except in circumstances provided in the Statute. Thus if the tenant gives notice for the freehold and afterwards finds that the price is more than he is able or willing to pay, he can withdraw his notice on paying compensation to the landlord (Section 9(3)). Or if the tenant gives notice for an extended lease and afterwards changes his mind, he can acquire the freehold by giving notice of his desire to have it (Section 5(8)).
Seeing, therefore, that as soon as the written notice is given, there is a binding contract, I cannot see any room for a notice in the alternative. If a tenant gives a notice that he desires"the freehold or an extended lease", without saying which, there can be no binding contract. The Statute simply cannot begin to operate. If I may put it into the form of offer and acceptance, it stands in this way: the Landlord, under the compulsion of the Statute, whether he likes it or not, makes an offer to the tenant to let him either buy the freehold at a fair priceor to take an extended lease of 50 years at a fair rent, In order to accept that offer, so as to make a binding contract, the tenant must accept one of these alternatives. If he replies: "I desire to have either the freehold or an extended lease", then there is no contract, because no one knows which it is. It is too uncertain to be a contract. It is just as if I say: "I offer to sell you my horse for £100 or my cow for £50" and you reply: "I accept your offer". There is no contract: for the simple reason stated by Lord Wright: When the words "fail to evince any definite meaning on which the Court can safely act, the Court has no choice but to say that there is no contract", see ...
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Decision Nº LRX 25 2013. Upper Tribunal (Lands Chamber), 10-09-2014
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...not a notice served under Part 1 of the 1967 Act is valid? There is not very much authority on this. We were referred to Byrnlea Property Investments Ltd. v. Ramsay [1969] 2 Q.B. 253, in which this court held that a notice under Part 1 which asked for "the freehold or an extended lease" (a......
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...case of a contract for sale . . . freely negotiated between the parties." As Lord Denning, Master of the Rolls observed in Byrnlea Property Investments Ltd v Ramsay [1969] 2 QB 253, 263H: "Once the notice is given, both parties are bound just as they are by an ordinary contract." 39 For my ......
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Procedure under the Leasehold Reform Act 1967
...meaning of reversioner, see para 2.12. Apart from paragraph 6, which requires the claimant 7 Byrnlea Property Investments Ltd v Ramsay [1969] 2 QB 253, CA. 8 Lewis v Harries (1971) 22 P&CR 905 CA. 9 Byrnlea Property Investments Ltd v Ramsay [1969] 2 QB 253 per Edmund Davies LJ at 267A. to s......
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Table of Cases
...1 All ER 144, CA 116 Burr v Eyre [1998] 2 EGLR 92, [1998] 20 EG 132, Central London Cty Ct 9 Byrnlea Property Investments Ltd v Ramsay [1969] 2 QB 253, [1969] 2 WLR 721, [1969] 2 All ER 311, CA 36 Cadogan and Another v Cadogan Square Ltd [2011] UKUT 154 (LC), [2011] 3 EGLR 127, UKUT 141, 14......