Facts
There was a week-to-week tenancy. Rent fell due every Monday. The tenant paid rent on the preceding Friday of each week.
Section 13 of the Housing Act 1988 prescribes that a notice to increase rent (“the increase”) must propose ‘a new rent to take effect at the beginning of a new period of the tenancy specified in the notice’.
Accordingly, the notice should have proposed the increase to take effect on a Monday. In fact, it proposed the increase to take effect on a Friday. Was the notice valid?
At first instance, the notice was held to have been valid for two reasons. First, it had to be seen against the background that the tenant paid rent of a Friday. Secondly, the tenant’s objection was entirely technical.
On first appeal, the notice was held to be invalid. There was more than one interpretation of the notice as to the date that the increase would take effect. Therefore, it would not have been clear to a reasonable, recipient tenant.
The landlord appealed essentially on two grounds. First, the notice was valid. Secondly, it was too late for the tenant to challenge the validity of the notice as she did not refer the matter to a rent assessment committee (the property was in Wales; in England, referral would be to the first-tier tribunal).
Discussion
The date from which the increase will take effect is critical for two reasons.
First, the date in the notice will enable to tenant to understand whether the statutory requirements have been met and leave no doubt about the date from which the increase is payable.
Secondly, it specifies the deadline by which the tenant must challenge the increase by a referral. That is, the beginning of the new period specified in the notice. Failure to refer before the deadline means that the increase takes effect.
The leading case is Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd [1997] UKHL 19, [1997] AC 749. It is authority that the notice will be interpreted so as to give effect to the way in which a reasonable recipient would understand it. The approach is objective.
A statutory notice, however, must also fulfil the purpose for which it is given.
In Pease v Carter [2020] EWCA Civ 175, [2020] 1 WLR 1459 at [39], Arnold LJ (with whom Underhill and Floyd LJJ agreed) concluded that:
(i) A statutory notice is to be interpreted in accordance with Mannai v Eagle, that is to say, as it would be understood by a reasonable recipient reading it in context.
(ii) If a reasonable recipient would appreciate that the notice contained an error, for example as to date, and would appreciate what meaning the notice was intended to convey, then that is how the notice is to be interpreted.
(iii) It remains necessary to consider whether, so interpreted, the notice complies with the relevant statutory requirements. This involves considering the purpose of those requirements.
(iv) Even if a notice, properly interpreted, does not precisely comply with the statutory requirements, it may be possible to conclude that it is ‘substantially to the same effect’ as a prescribed form if it nevertheless fulfils the statutory purpose. This is so even if the error relates to information inserted into or omitted from the form, and not to wording used instead of the prescribed language.”
Underhill LJ added (with my emphasis) that “as regards (ii), that there must be no reasonable doubt as to what the notice was intended to say”.
Disposal
On validity, it may be that the landlord made a mistake as to the proposed start date of the increase. It was at least as likely, however, that the landlord intended the increase to take effect from that date in the notice. In other words, there was reasonable doubt.
As to the referral, courts have jurisdiction to determine the validity of a notice unless legislation prescribes otherwise. Section 14 of the Housing Act 1988 does not prescribe otherwise. Failure to refer the notice (to the committee) did not deprive the court of jurisdiction to determine the validity of the notice.
The notice was invalid. The appeal was dismissed.
Written by Dominic Bright.