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Toms v Ruberry [2017] EWHC 2970 (QB)

A notice under the Law of Property Act 1925 s 146, which allowed a landlord to re-enter premises due to a tenant’s breach of covenants in a lease, should not be served before the relevant right to re-enter had occurred. This was ruled by the Queen’s Bench Division in dismissing the appellant landlord’s appeal against a judge’s decision dismissing his claim for possession of a public house leased to the respondent tenant.
The appellant (T) was the freehold owner of a public house. The respondent (R) was the tenant of the premises and resided there, under the terms of a business lease. The lease provided that, if the tenant breached her obligations under it, the landlord had the right to re-enter the premises and forfeit the lease. It further provided that the Law of Property Act 1925 s146 applied, under which a right of re-entry or forfeiture in a lease for a breach of any covenant was not enforceable, unless the lessor served on the lessee a notice: (i) specifying the particular breach complained of; and (ii) if the breach was capable of remedy, requiring the lessee to remedy the breach; and (iii) in any case, requiring the lessee to make compensation in money for the breach; and the lessee failed, within a reasonable time thereafter, to remedy the breach.
The lease also provided that, if the tenant breached any of its covenant, the landlord had to serve a ‘default notice’, giving her 14 days to remedy the breach. T instructed a surveyor, under the terms of the lease, who identified a number of breaches of covenants by R (the breaches), including the failure to keep the garden and grounds clean and well-tended. Solicitors acting for T sent R a default notice, under the lease, and a notice, under LPA 1925 s146.
A further inspection of the premises was carried out. T contended that there had been a failure to remedy the breaches within reasonable time and that the lease was forfeited. T brought proceedings for possession. A judge dismissed the claim, having agreed with R’s contention that possession could not be claimed, under the lease, because the 14-day period, under the default notice, had not expired.
The authorities established that LPA 1925 s 146 had to be given a common sense interpretation and that the purpose of the section was that the tenant should have full notice of what he or she was required to do. However, there was no authority to support the proposition that a s146 notice might be served before the relevant right to re-entry had occurred. The wording of s 146(1) required ‘a right of re-entry or forfeiture under any proviso or stipulation in a lease for a breach of any covenant or condition in the lease’. The ordinary meaning of that provision suggested that the right of re-entry had to exist, because there was reference to ‘a right’ not to ‘a future right’. That interpretation was supported by the requirement set out in s 146(1)(a) that the notice had to specify ‘the particular breach complained of’. That required the ‘particular breach’ to have occurred, because otherwise, the service of the s 146 notice became a matter of guesswork about whether a particular breach would occur, and because it was not possible to specify a particular breach unless it had occurred.
For further advice contact Tom Warrender, Head of Commercial Property, or John Gordon Head of Commercial Litigation.