This week’s legal update looks at the Judgment handed down on 3 November 2022 by the Court of Appeal concerning the validity of a notice to quit and the application of the principles of the Mannai test when determining whether the notice could be valid despite an error in it.

This, as you will spot shortly, is a case relating to an agricultural tenancy and so you may ask, what has it got to do with you and your residential property portfolios?  The answer is that the principles relied on in this case apply to the residential property sector too and so the findings in this case will apply to what you do on a daily basis insofar as you are serving documents upon tenants and leaseholders.

By way of background information, the principles in Mannai Investment Co v Eagle Star Life Assurance (1997) (“Mannai”) were that where a notice contains an error that error may not invalidate the notice.  Instead the effect of the error made should be assessed on an objective basis, having regard to how a reasonable recipient would understand the notice and thus if, with knowledge of the background, the reasonable recipient would understand the purpose of the notice, then the error should have no effect. We previously covered this in February 2020 in our legal update here entitled “Errors on notices - When a typo is more than a mere typo”

Facts of this case

Mr Thomas was the tenant of an agricultural holding pursuant to an oral tenancy running from year to year (and governed by the Agricultural Holdings Act 1986). On 1 November 2019, Mr Thomas instructed solicitors to assign the tenancy to a newly incorporated company called O G Thomas Amaethyddiaeth CYF (“the Company”). Mr Thomas was the sole director and shareholder of the company and the registered office was his home address.

As his tenancy was oral, there was no restriction on its assignment by the tenant.   Importantly, Mr Thomas did not inform his landlord of the assignment and so in what follows the landlord was wholly unaware of the assignment or even the existence of the Company.

Three days after the tenancy was assigned by Mr Thomas to the Company, the landlord served a notice to quit addressed to Mr Thomas and delivered it by hand to his home address. Mr Thomas asserted that the notice to quit was not valid against the Company as it was addressed to him in person and not the actual tenant, the Company. The landlord argued that the notice clearly and unambiguously communicated the required message.

Ruling of the lower Courts

The lower courts held that the notice to quit was valid against the Company. They reached this decision by applying the principles of Mannai and considered that the notice clearly conveyed the landlord’s intention to require “the tenant” to deliver up possession of the agricultural holding. On this basis, the notice was deemed validly given to the Company.

The Decision of the Court of Appea 

The Court of Appeal overturned the lower courts decision, holding that a notice to quit addressed to the former tenant of a holding was not given to the current tenant and it could not be interpreted as such. Addressing a notice to quit to the wrong recipient amounted to a failure to satisfy a formal condition for the notice’s validity, which could not be saved by the principles in Mannai.

Conclusion

This is an important reminder of the importance of getting your notices right. Whilst the principles of Mannai allow for an error on a notice to be objectively assessed having regard to how a reasonable recipient would understand the notice and its purpose, O G Thomas makes clear that addressing a notice to quit to the wrong recipient cannot be saved by Mannai.

See here, here, here and here for some further helpful guidance on steps to take to assist in avoiding errors on notices, demands and correspondence.

Disclaimer

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