Harry Fitzhugh v Anthony Fitzhugh
| Jurisdiction | England & Wales |
| Judge | Lord Justice Rimer,Lord Justice Patten,Lord Justice Longmore |
| Judgment Date | 01 June 2012 |
| Neutral Citation | [2012] EWCA Civ 694 |
| Court | Court of Appeal (Civil Division) |
| Date | 01 June 2012 |
| Docket Number | Case No: A3/2011/3117 |
[2012] EWCA Civ 694
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
BIRMINGHAM DISTRICT REGISTRY
Mr Justice Morgan
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Longmore
Lord Justice Rimer
and
Lord Justice Patten
Case No: A3/2011/3117
Mr James Howlett (instructed by Nelsons) for the Appellant, Anthony Fitzhugh
Mr Timothy Clarke (instructed by Moody & Woolley) for the Respondent, Harry Fitzhugh
Hearing date: 17 May 2012
Introduction
The question raised by this appeal is a short one as to the interpretation of a licence agreement. In essence, it is this. If A and B (described as 'the Licensor') grant a licence to occupy land to B and C (described as 'the Licensee'), and the licence automatically terminates upon the failure of B and C to remedy any remediable breaches within the time specified by a notice given by 'the Licensor' to 'the Licensee', can such a notice validly be given by A alone?
That question arose for decision before Morgan J in a family dispute in which the claimant is Harry Fitzhugh and the defendant is his brother Anthony. In his judgment delivered on 11 November 2011 ( [2011] EWHC 3553 (Ch)), Morgan J answered the question in the affirmative and, by his order of the same date, declared that the licence had been determined by notice with effect from 27 February 2006.
With the permission of the judge, the defendant appeals against that declaration. He was represented before us, as before the judge, by James Howlett. Timothy Clarke represented the claimant, as he did before the judge.
The facts
Harry Fitzhugh Senior died intestate on 10 April 1995 survived by nine children of his first marriage. The claimant is his sixth child, and I shall call him Harry. The defendant is his youngest child, born in 1960, and I shall call him Anthony. Letters of administration of the father's estate were, on 15 June 1995, granted to his four sons, Geoffrey, Colin, Harry and Anthony. Colin died in 1997.
The principal asset of the father's estate was Poplars Farm, near Derby, comprising a farmhouse and garden and five other plots of land. On 3 July 1998 the three surviving administrators, Geoffrey, Harry and Anthony, conveyed the farmhouse and garden to Anthony and his partner, Karen Boddey ('Karen'). On the same day, they also granted the licence to Anthony and Karen. It was of farm outbuildings and various fields.
I must set out the material terms of the licence. It is described as a 'Licence' and as being between (1) Geoffrey, Anthony and Harry (described as 'the Licensor') and (2) Anthony and Karen (described as 'the Licensee'). It then provides:
'1. The Licensor grants to the Licensee the right to keep sheep cattle horses or pigs on the premises described in the First Schedule hereto for grazing purposes and the right to mow premises twice a year and to take away the grass
2. Further the Licensor permits the Licensee to enter onto the premises to the extent necessary to exercise the rights and for the avoidance of doubt full occupation and possession of the premises remains with the Licensor subject only to the rights granted by this Licence to the Licensee
3. The Licensee agrees with the Licensor to pay the Licence fee of one pound a year and to use the premises for the exercise of the rights and for no other purposes and on the termination of the Agreement to remove the Licensee's stock from the premises
4. The rights granted under and this Licence itself will terminate immediately on the happening of any of the following events:—
(a) The Licensee dying or becoming incapable by reason of mental or physical illness from discharging his obligations under this Agreement
(b) The Licensee commits any grave or persistent breaches of this Licence and the Licensor having given written notice to the Licensee of such breach or breaches the Licensee fails within such period as the Licensor may specify to rectify such breaches if capable of rectification
(d) [sic: there is no (c)] Upon the Licensor obtaining planning permission for the development of all or any part of the land the subject of this licence …
6. This Licence and the rights contained in it are personal to the Licensor and Licensee and will not be capable of being assigned or otherwise dealt with'
Geoffrey died in 2001, upon which event Harry and Anthony became the sole surviving administrators, as they still were at the date of the judge's judgment, although his order provided for both to cease to be administrators and to be replaced by two new administrators.
Anthony and Karen did not pay the annual licence fee of £1. On 16 February 2006 Walker Terry & Wilson, solicitors, purportedly writing 'on behalf of all the family members of the late Harry Fitzhugh Senior regarding his estate', made various requests of Anthony and Karen, including that, within seven working days, they paid the £7 arrears of licence fee owing to the estate. They did not do so. Over three years later, in September 2009, Harry commenced these proceedings against Anthony in the Chancery Division, seeking various heads of relief including possession of the land the subject of the licence. Anthony defended the claim, which was tried before Morgan J in 2011. Morgan J's 112-paragraph judgment reflects that he had to consider many issues, the one giving rise to the present appeal being but one of them.
The judge's decision
That issue was whether the licence had been terminated. Harry claimed that it had been terminated under clause 4(b) in consequence of the failure of Anthony and Karen to pay the £7 arrears of the licence fee within the seven day period prescribed by the notice given in February 2006. Morgan J found, and it is not challenged, that the failures to pay the licence fee from 1998 to 2006 amounted to 'persistent breaches' of the licence within the meaning of clause 4(b). He did not, in those circumstances, find it necessary also to decide whether such breaches were 'grave'. He found that Anthony and Karen did not remedy the breaches within the seven day period specified in the notice. He explained that Mr Howlett did not invite him to assume any jurisdiction (if such there was) to grant Anthony relief against forfeiture.
In that state of play, the only remaining issue was whether the solicitors' letter of 16 February 2006 was a valid notice for the purposes of clause 4(b). That turned on the fact, as the judge found, that it had been given only on behalf of Harry, but not also on behalf, or with the authority of Anthony, whereas at the relevant time 'the Licensor' was both Harry and Anthony. Did the notice meet the requirements of clause 4(b)?
The judge referred to the well-established common law principle that a contractual periodic tenancy granted by joint landlords to joint tenants continues only for so long as they all agree in its continuation. Such a tenancy can thus be determined by a notice to quit given by just one of the landlords without the concurrence of the others or (likewise) by just one of the tenants: see Hammersmith and Fulham London Borough Council v. Monk [1992] 1 AC 478. The judge, however, regarded that principle as having no application to the issue before him, since he was faced with an express contractual provision in the licence (clause 4(b)) which required the notice to be given by 'the Licensor'; and the critical question was whether, upon the true interpretation of the licence, that meant both Harry and Anthony or just Harry. The distinction that the judge was there recognising was that expressly identified in the Hammersmith case by Lord Bridge, at [1992] 1 AC 492, 490G to 491A, and by the later decision of the Court of Appeal in Hounslow London Borough Council v. Pilling [1993] 1 WLR 1242 (see at 1246H to 1247E).
The question was thus whether, as a matter of interpretation, 'the Licensor' in clause 4(b) meant both Harry and Anthony; or whether it meant, or could be read as meaning, a reference just to Harry. The judge's opening view, in paragraph 86 of his judgment, was that there was no easy way to read 'the Licensor' as there referring to any one of the licensors. He was, however, reluctant not so to read it and considered it necessary to take into account that there was an overlap between the persons who were the licensor and licensee. In such a case, he said it was unlikely, if not certain, that a licensee who is also a licensor would join in giving the notice on a voluntary basis. If not, and all licensors must join in the service of the notice, then the non-licensee licensors must precede the giving of any notice either by (i) seeking the removal of the reluctant licensee as a trustee (as a co-owner of the land, he will necessarily be a trustee), or (ii) perhaps by seeking an injunction requiring him to join in the giving of a notice.
In the judge's view:
'89 … to hold that no notice can be given is an unsatisfactory contractual result which the parties cannot have intended. It also seems to me that a requirement in my example of A and B that A gets B removed or A gets an injunction requiring B to serve a notice on...
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