Scholl Mfg. Company Ltd v Clifton (Slim-Line) Ltd

JurisdictionEngland & Wales
JudgeLord Justice Harman,Lord Justice Diplock,Lord Justice Winn
Judgment Date08 June 1966
Judgment citation (vLex)[1966] EWCA Civ J0608-3
CourtCourt of Appeal
Date08 June 1966
Docket Number1965. S. No. 4934.

[1966] EWCA Civ J0608-3

In The Supreme Court of Judicature

Court of Appeal

Appeal from Order of Cross J. dated 16th February, 1966.

Revised.

Before:

Lord Justice Harman

Lord Justice Diplock and

Lord Justice Winn

1965. S. No. 4934.

In the Matter of the Landlord and Tenant Act, 1954.

Between:
Scholl Manufacturing Company Limited
Plaintiffs
and
Clifton (Slim-Line) Limited
Defendants

Mr Hugh E. Francis, Q.C., and Mr B. Keith Levy (instructed by Messrs A. Oldschool & Co.) appeared on behalf of the Appellants (Defendants).

Mr Peter R. Oliver, Q.C., and Mr Michael A. F. Lyndon-Stanford (instructed by Messrs Blyth, Dutton, Wright & Bennett) appeared on behalf of the Respondents (Plaintiffs).

Lord Justice Harman
1

On the 10th May 1965 the relationship between the plaintiffs and the defendants in this suit was that of landlord and tenant under an underlease of the 20th March 1959 having a term which would expire on the 26th March 1966. This, however, was not a term certain because by virtue of clause 3 (iii) of the document either party was entitled up to September 1965, by expressing a wish so to do, to cause the term to end at Lady Day 1966. This was the contractual position between the parties and productive of no complication; either side could, by a notice which conveyed merely the wish so to do, put an end to the lease. That, however, is not the position having regard to the Landlord andTenant Act, 1054, which, like much modern legislation, is a statutory interference with freedom of contrast, and like many such interferences if apt to produce complications.

2

It is agreed between the parties that this lease created a business tenancy, and was therefore within Part II of the Act section 23 causes Part II of the Act to apply to this tenancy, and accordingly, under section 24, such a tenancy will not come to an end unless terminated in accordance with the provisions of the Act. The same section gives the tenant a right to apply for new tenancy. The landlord who is desirous of putting an end to such a tenancy may do so by notice in a prescribed form in pursuance of section 25, and by subsection (3) of this section the date of termination specified in a notice under this section must not be earlier in date than the date on which, apart from the Act, the tenancy could have been brought to an end "by notice to quit given by the landlord". Notice to quit here by virtue of the definition section (section 69) includes a notice bringing into operation a break clause in the lease although that is not the natural meaning of the words.

3

Now here the landlord, being minded to resume possession of the demised property, served on the tenant a notice in accordance with section 25, as the Act says he may do provided that the notice is in the prescribed form and indicates a date for termination not earlier than the date when the break clause would operate.

4

It is objected by the tenants that this notice is of no effect. They say that, there having been no exercise of the break Clause, it was not open to the landlords, by a mere notice in the prescribed form under section 25, to put an end to a term of years which, as matters stood between the parties, went on until 1973.

5

In a decision of my own in 1958 in Woinbergs Weatherproofs Limited v. Radcliffe Paper Mill Company Limited (1958 Chancery Division, page 437) I had occasion to deal with the converse of this situation, as indeed the learned judge below pointed cut. In that case there was a lease with a break clause in it and the landlord served a notice to quit to operate the brook clause, but not inaccordance with the form prescribed by section 25 of the Act. I held that, contrary to the tenant's contention, the notice was good to curtail the term under the break clause, though having regard to section 24 of the Act it did not bring the lease to an end. This part of the decision appears to be accepted by both sides, but I added sane obiter dicta in the form of the suggestion that, if that view were net right, it would never be possible to bring a break clause into operation.

6

The learned judge below in this case, as he was well entitled to do, ignored that observation, which I think on reflection was wrong. In the present case, however, the question is whether, having regard to section 26 of the Act, the landlord may determine a lease having a break clause each as the present one under that section provided only that the termination date is not earlier than the date on which the break clause could operate. The learned judge held that the landlord could do this without first going through the formality of serving a notice to bring the break clause into operation. In my opinion the learned Judge was right) in feet I think that section 25 so provides in express terms.

7

A second point was taken, namely, on the footing that the judge so far was wrong, yet the statutory notice, combined with the covering letter sent with it, was itself a sufficient notice to terminate the break clause. The objection made by the tenants was that on the face of it the notice referred merely to the statute and did not mention the break clause frost beginning to end. It was said that the tenant had two rights, his contractual rights under the lease, and his statutory right, and that each of these had to be brought to an end separately. The...

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15 cases
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    ...view was that the common law tenancy subsisted with a statutory variation as to the mode of termination’).” 315 Again in Scholl Mfg. Co. Ltd. v. Clifton (Slim-Line) Ltd. [1967] Ch. 41 Lord Diplock in dealing with a business tenancy under Part II of the Landlord and Tenant Act 1954 said this......
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    ...Mr Lewison submitted that that was not how section 25 of the 1954 Act worked, and he cited the decision of this court in Scholl Mfg Co Ltd v Clifton (Slim-Line) Ltd [1967] Ch 41. In that case Harman LJ said (at p.48), "… the question is whether, having regard to section 25 of the Act, the l......
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