Laine v Cadwallader

When a fixed-term assured tenancy ends, the statutory periodic tenancy arising under the Housing Act 1988 has the same rental periods as those for which rent was last payable. The frequency of payment does not determine the tenancy periods. A tenant seeking unilaterally to terminate the periodic tenancy must give proper notice to quit, normally for at least one complete tenancy period and expiring at its end. A contractual determination clause is ineffective while the tenancy remains assured. Returning the keys ordinarily amounts only to an offer to surrender. The tenancy ends immediately only if the landlord accepts that offer; otherwise, the parties may agree a later termination date.

The claimants let the defendants a dwelling house under a six-month assured shorthold tenancy. Rent was expressed to be £390 per calendar month, payable every two months in advance. After the fixed term expired, a statutory periodic assured tenancy arose. The tenants later returned the keys, but the landlords claimed four weeks’ rent in lieu of notice.

The district judge awarded arrears and compensation for damage but refused rent in lieu of notice. Judge Overend dismissed the claimant’s appeal but granted permission to appeal. The central issue was whether the tenants had validly terminated the statutory periodic tenancy, and whether returning the keys constituted a surrender.

1. Appeal allowed. The landlords were entitled to recover rent for the four-week period after the keys were returned.
2. Under section 5 of the Housing Act 1988, the fixed-term assured tenancy became a statutory periodic assured tenancy. Its periods were those for which rent was last payable under the fixed-term tenancy. Because the rent was stated to be payable per calendar month, the tenancy periods were calendar months. Payment every two months in advance concerned only the time of payment.
3. Clause 5 of the tenancy agreement could not determine the statutory periodic tenancy. Section 5(3)(e) rendered ineffective any term providing for determination by the landlord or tenant while the tenancy remained assured.
4. A periodic tenancy continues until terminated by proper notice. Applying the principle stated in (1991) 1 WLR 1007, a tenant must give notice for at least one tenancy period and expiring at the end of such a period. The judge had overlooked that obligation. Section 5(1) of the Protection from Eviction Act 1977 would impose a minimum four-week period where the tenancy periods were shorter.
5. Putting the keys through the landlords’ letter box could not itself amount to an immediate surrender. It was no more than an offer to surrender, which the landlords could accept or reject. There was no express acceptance producing immediate termination. On the evidence, however, the landlords treated the keys as notice or an offer to terminate and agreed that the tenancy would end after four weeks. The tenancy therefore terminated by agreement at that time.
6. By contrast, a landlord cannot unilaterally terminate a statutory periodic assured tenancy without obtaining an order of the court, under section 5(1) of the Housing Act 1988.

• Court of Appeal (Civil Division): Appeal from the order of His Honour Judge Overend, dated 26 May 1999, allowing the appeal and awarding rent for the four-week period.
• Plymouth County Court: Judge Overend dismissed the claimant’s appeal against part of District Judge Child’s judgment dated 28 April 1999, but granted permission to appeal.
• District Judge: Awarded arrears of rent and the cost of repairing damage, but refused rent in lieu of notice.