Asela Wijeyaratne instructed in Court of Appeal case considering the definition of “Landlord"

Daniel Black considers the decision in Barrow v Kazim [2018] EWCA Civ 2414 in which Asela Wijeyaratne appeared for the Respondents.

 

Who is a “landlord”?

 

That was the question before the Court of Appeal in Barrow & Anor v Kazim & Ors [2018] EWCA Civ 2414 which arose in the context of Assured Shorthold Tenancies under section 21 of the Housing Act 1988.

In submissions described by Newey LJ as well advanced, Asela Wijeyaratne argued on behalf of the Respondent proprietors that the answer was: them.

The judgment has commercial significance. Assured Shorthold Tenancies are commonplace but are only subject to being brought to an end in one of two ways. That is, by the landlord obtaining and executing an order for possession via either section 7 or section 21 of the Act. 

It is the latter method that is typical. Section 21 provides that a court shall make an order for possession of the dwelling house if it is satisfied that: “the landlord or, in the case of join landlords, at least one of them has given to the tenant not less than two months’ notice in writing stating that he requires possession of the dwelling house.”

In 2012, the predecessors in title of the Respondents leased a block of flats to an Agency. By agreement, the Agency was itself permitted to sub-let the premises for residential accommodation. They did so with the Appellants becoming assured shorthold tenants, a status they retained when the Respondents became registered proprietors in November 2015.

By 2016, the Respondents sought possession of the flats. Accordingly, on 12 January 2016 they served a document headed “Notice to quit” on both the Agency and the Appellants. It stated that possession was required on 19 March 2016. This was effective to end the Agency’s mesne tenancy from that date. However, section 18 of the Act operated to preserve the tenancy of the Appellants until a section 21 possession order was obtained and executed in favour of the landlord, something which required that the “landlord” had given the requisite statutory notice.

Accordingly, the question became: were the Respondents “landlord” before 19 March 2016?

The section 45 definition of “landlord” includes “any person other than a tenant who is, or but for the existence of an assured tenancy would be entitled to possession of the dwelling house.” The Respondents claimed to fall within that definition because, but for the Appellant’s tenancies, they would have been entitled to possession on 19 March 2016. Therefore, the reality was that the Appellants had two “landlords.” The Respondent for the purposes of the notice and the Agency, which remained “landlord” until 19 March 2016 for other purposes. Support for this argument was found in the obiter remarks of Lord Evershed MR and Somerville LJ in Dudley and District Benefit Building Society v Emerson [1949] Ch 707, concerning a statute from 1920.

Ultimately, the Court of Appeal found in favour of the Appellants. The date of notice was determinative. The Respondents were not “landlord” for any purpose on the date they purported to give the notice to the Appellants because, at that time, they were not persons who “but for the existence of an assured tenancy…would be entitled to possession.”  Rather, the Agency was. Being entitled to possession in the future is a different thing: it did not make the Respondents “landlord.”

Commercially, the implications are that superior landlords cannot serve notice on assured shorthold tenants in circumstances where there is a mesne tenancy until the latter has come to an end. Accordingly, superior landlords should take note of the judgment and consider inserting clauses in their agreements with mesne tenants whereby they can require them to serve the statutory notice when instructed.

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