Nov

COURTS: Landmark ruling given on commercial property ‘notices to quit’

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In a landmark decision, the Court of Appeal has ruled that a landlord was wrong to serve notice on a commercial tenant who hadn’t told him he had assigned the tenancy to a company.

It overturned previous rulings relating to the case of O G Thomas Amaethyddiath v Turner & Ors concerning the validity of a notice to quit an agricultural holding which was held under an oral tenancy.

The tenant, Mr Thomas, assigned the tenancy to a company – and was the sole director and shareholder – however the landlord was unaware that the company existed.

Three days later, he served a bare notice to quit, addressing both the notice and its covering letter to Mr Thomas and not the company. This was served on the tenant at his home address which was also the company’s registered address.

Stuart Nevin (pictured) principal associate at Shoosmiths, says that the key issue for the court was whether the notice to quit was valid, despite having been addressed to Mr Thomas rather than the company.

The previous courts – first instance and first appeal – ruled that sufficient notice had been given to the company despite the landlord having no knowledge of the assignment.

But the Court of Appeal overturned that decision. Nevin explains that a notice with typographical errors – where an intention to serve on the correct recipient is clear – could still hold, but not when the landlord was unaware of the assignment to the new tenant company.

“O G Thomas is an important decision for practitioners, landlords and tenants when effecting proper service of a notice to quit,” he says.

“The fact that Mr Thomas was the sole shareholder of the company, and that the company’s registered address was identical to Mr Thomas’ address, did not offer sufficient grounds to validate the notice.”

Read the ruling in full.

View Full Article: COURTS: Landmark ruling given on commercial property ‘notices to quit’