O G Thomas Amaethyddiaeth CYF v Turner and Ors
| Jurisdiction | England & Wales |
| Judge | Lord Justice Lewison,Lady Justice Asplin,Lord Justice Nugee |
| Judgment Date | 03 November 2022 |
| Neutral Citation | [2022] EWCA Civ 1446 |
| Docket Number | Case No: CA-2022-001190 |
| Court | Court of Appeal (Civil Division) |
[2022] EWCA Civ 1446
Lord Justice Lewison
Lady Justice Asplin
and
Lord Justice Nugee
Case No: CA-2022-001190
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS IN WALES
CHANCERY APPEALS (ChD)
ORDER OF ZACAROLI J DATED 26 MAY 2022
APPEAL REF: CF084/2021CA
Royal Courts of Justice
Strand, London, WC2A 2LL
Stephen Jourdan KC and Gavin Bennison (instructed by Ebery Williams) for the Appellant
Oliver Radley-Gardner KC (instructed by JCP Solicitors) for the Respondents
Hearing date: 27/10/2022
Approved Judgment
This judgment was handed down remotely at 10.30am on 03/11/2022 by circulation to the parties or their representatives by e-mail and by release to the National Archives.
Introduction and facts
The issue in this case is whether a notice to quit an agricultural holding is valid.
The facts are agreed and may be shortly stated. The subject matter of the tenancy is a farm at Pentre Canol, Dyffryn Ardudwy. Mr Owen Gwilym Thomas was granted an oral tenancy of the farm by the then owner of the farm, a Mr Morris. Mr Thomas lived at Bodlondeb, Dyffryn Ardudwy, Gwynedd, LL44 2EU. Because the tenancy was oral, it contained no restriction on its assignment by the tenant.
On Mr Morris' death, the freehold passed to Jane Louisa Jones. On her death, it passed to Mr Owen, as executor of her estate to whom probate was granted on 4 June 2019.
On 30 October 2019, Mr Thomas incorporated a company called O G Thomas Amaethyddiaeth CYF (in English: “OG Thomas Agriculture Ltd”). Mr Thomas became the sole shareholder and officer of the company and its secretary. Its registered office was the same as Mr Thomas' home address.
On 1 November 2019, without telling the landlord, Mr Thomas executed a deed of assignment of the tenancy to the company. It is common ground that this was effective to vest the tenancy in the company. Thereafter Mr Thomas was the person responsible for the management of the farming enterprise (which included the farm) on behalf of the company.
On 4 November 2019, Mr Owen (who was unaware of the assignment of the tenancy) served a notice to quit. It was sent by recorded delivery post to Mr Thomas at his home address, which was also the registered office of the company. The covering letter was addressed to Mr Thomas. The relevant parts of the notice read:
“ Notice to Quit given by Landlord …
To Owen Gwilym Thomas of Bodlondeb…
Re: Lands at Pentre Canol, Dyffryn Ardudwy…
I [Mr Owen] as Sole Executor of the last Will and Testament of Jane Louisa Jones… Give you notice to quit and deliver up possession of ALL THAT holding and premises known as lands at Pentre Canol… which you hold of me as tenant on [13 November 2020] or at the expiration of the year of your tenancy which shall expire after the end of 12 months from the date of service of this notice.”
Neither Mr Thomas nor the company served a counter-notice in response to this notice.
The judgments below
Both HHJ Jarman QC and, on a first appeal, Zacaroli J held that the notice to quit was valid, despite having been addressed to Mr Thomas. They both held that a reasonable recipient of the notice would have appreciated that a mistake had been made in naming the tenant and would have read it as having been addressed to the company. Zacaroli J's judgment is at [2022] EWHC 1239 (Ch).
Zacaroli J summarised his reasoning thus:
“[35] The only (but in this case critical) requirement, therefore, is that the notice conveys to the tenant an instruction to quit the premises the subject matter of the lease.
[36] As I have already noted, the test under Mannai is whether, in the context in which the Notice was given, the reasonable recipient would have understood it to have been addressed to the Company as tenant under the Lease.
[37] The relevant context includes the following:
(1) The Notice correctly identified the Lease as the one that had been granted to Mr Thomas (because it referred to “you”, i.e. Mr Thomas, as the person holding the Land “of me” as tenant);
(2) The Notice correctly identified the Land that was the subject of that lease;
(3) The lease had been assigned to the Company; and
(4) The landlord was unaware of that assignment.
[38] On the basis of those facts, I am satisfied that the reasonable recipient would have no doubt that the Notice was intended to convey an intention to require the person who was in fact the tenant of the Lease to deliver up possession of the Land. Since the reasonable recipient would have known that the Company was, in fact, the tenant under the Lease, he would therefore have understood the Notice to be addressed to the Company.”
He concluded at [43]:
“… the Notice was quite clear to a reasonable tenant reading it, in that it would be obvious that it was intended to be addressed to the Company because it was the Company alone that met the description of the person holding the Land under the Lease from Mr Owen. It is plain, in my judgment, that the reasonable recipient could not have been misled by the Notice.”
Legislative framework
The Agricultural Holdings Act 1986 does not require a notice to quit to take any particular form (except that it is invalid if it purports to terminate the tenancy before the expiry of twelve months from the end of the then current year of the tenancy): section 25 (1). The only other potentially relevant provisions of the Act are section 26 and section 93. Section 26 provides:
“Where—
(a) notice to quit an agricultural holding or part of an agricultural holding is given to the tenant, and
(b) not later than one month from the giving of the notice to quit the tenant serves on the landlord a counter-notice 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, on an application by the landlord, the Tribunal consent to its operation.”
The exceptions in section 26 (2) are not relevant in this case. Section 26 (1) plainly assumes that notice to quit has been “given to the tenant”.
Section 93 provides:
“(1) Any notice, request, demand or other instrument under this Act shall be duly given to or served on the person to or on whom it is to be given or served if it is delivered to him, or left at his proper address, or sent to him by post in a registered letter or by the recorded delivery service.
(2) Any such instrument shall be duly given to or served on an incorporated company or body if it is given or served on the secretary or clerk of the company or body.
(3) Any such instrument to be given to or served on a landlord or tenant shall, where an agent or servant is responsible for the control of the management or farming, as the case may be, of the agricultural holding, be duly given or served if given to or served on that agent or servant.
(4) For the purposes of this section and of section 7 of the Interpretation Act 1978 (service by post), the proper address of any person to or on whom any such instrument is to be given or served shall, in the case of the secretary or clerk of an incorporated company or body, be that of the registered or principal office of the company or body, and in any other case be the last known address of the person in question.
(5) Unless or until the tenant of an agricultural holding has received—
(a) notice that the person who before that time was entitled to receive the rents and profits of the holding (“the original landlord”) has ceased to be so entitled, and
(b) notice of the name and address of the person who has become entitled to receive the rents and profits, any notice or other document served upon or delivered to the original landlord by the tenant shall be deemed for the purposes of this Act to have been served upon or delivered to the landlord of the holding.”
If there had been a deeming provision equivalent to section 93 (5) applicable to an assignment by the tenant, there would have been no problem. But there is not; and so we are thrown back on the common law. We have seen from section 26 that the need to serve a counter-notice only arises where notice to quit “is given to the tenant”. So the question is: was notice to quit given to the tenant?
Blue paper v pink paper
In Mannai Investment Co Ltd v Eagle Star Assurance Co Ltd [1997] AC 749 the House of Lords considered the validity of a notice given under a contractual break clause contained in clause 7 (13) of a lease. Such a clause is in the nature of an option. Those of their Lordships in the majority distinguished between formal requirements on the one hand, and requirements to impart information on the other. Lord Steyn at 767 referred to what he described as “indispensable” conditions for the effective exercise of the right. Among them was “service (“on the landlord or its solicitors”)”. Lord Hoffmann illustrated the difference graphically at 776:
“If the clause had said that the notice had to be on blue paper, it would have been no good serving a notice on pink paper, however clear it might have been that the tenant wanted to terminate the lease. But the condition in clause 7(13) related solely to the meaning which the notice had to communicate to the landlord. If compliance had to be judged by applying the ordinary techniques for interpreting communications, there was strict compliance. The notice clearly and unambiguously communicated the required message.”
Lord Clyde said at 781:
“The substance of the power is expressed by the words, ‘The tenant may … determine this lease.’ The method of its exercise is specified by the intervening words. The tenant must give six months' notice; the notice must be in writing; the notice must be...
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...November 2022, The Court of Appeal published its decision in O G Thomas Amaethyddiath v Turner & Ors [2022] EWCA Civ 1446 which concerned a narrowing of the scope of the Mannai Principle, a rule that can be relied upon in certain circumstances to save a defective The decision highlights the......