129: Notice to Quit: A commercial approach
Jennifer Chappell Real Estate Counsel
This blog was written by Florence Ryan, Paralegal with BDB
The Court of Appeal has been asked to decide whether a notice to quit served on an agricultural tenant was valid. The notice had been served on the tenant’s address stated in the lease, not the address that the tenant subsequently notified to the landlord in writing.
Facts
The claimant farmed a large agricultural holding with his father for a number of years under successive tenancy agreements. The tenancy agreement provided that any notice may be served on a party to the agreement:
‘at the address given in the Particulars or such other address as has been previously notified in writing.’
The agreement recorded the tenant’s address as Glebe Way, Burnham-on-Crouch, but during the negotiation of the agreement the tenant relocated. On making his first rental payment under the tenancy agreement in December 2006, the tenant informed the landlord in writing of his new address.
The defendant served notice to quit in 2011 at the old address listed in the original tenancy agreement. The tenant claimed that he did not know about the notice as it was served at the wrong address.
Decision
At first instance, the trial judge applied a literal interpretation of the words in the tenancy agreement. He said that notice could be effected either at the address stated in the agreement, or at the address that had since been notified. Therefore the landlord’s notice was valid.
The Court of Appeal disagreed. It held that the notice had not been validly served, and as such the agreement had not been validly terminated.
The court’s interpretation of the agreement took into consideration the commercial principles of construction in Arnold v Britton [2015], focusing on the meaning of the words of a contract in their documentary, factual and commercial context.
The court emphasised that if the word ‘or’ was taken literally, an ‘unscrupulous’ landlord could take advantage of such a provision and knowingly serve on the tenant’s old address. When interpreting the wording of this clause, the use of the word ‘other’ indicated that the parties intended that the new address should be a substitute for the old address.
As a matter of commercial common sense, the parties cannot have intended that the serving party should continue to have the option of serving a notice at an old address once it had been notified of a new one. Therefore the notice to quit was incorrectly served and deemed invalid.
This case highlights the need for careful drafting in notice provisions but also that the courts will look at a common sense, literal interpretation of wording in order to make practical sense of contract.
T Grimes v The Trustees of the Essex Farmers and Union Hunt [2017] EWCA Civ 361
