Blunden v Frogmore Investments Ltd

A statutory business-tenancy termination notice under Landlord and Tenant Act 1954 may operate in substitution for a contractual break notice. A landlord need not serve both.

Where a lease expressly provides that notice is validly served if sent by post to the tenant’s last known address, the court will not imply a requirement that the letter be delivered or not returned. Likewise, service by recorded delivery under section 23(1) of the Landlord and Tenant Act 1927 does not expressly depend on receipt.

The appeal was therefore dismissed. No majority ruling was made on whether affixing notice to premises known to be inaccessible to the tenant constituted valid service.

The appellant held a six-year lease of retail premises in the Corn Exchange, Manchester. Following extensive bomb damage, the respondent landlord sought to terminate the lease under a destruction-and-damage clause. It posted both a contractual notice and a statutory notice under section 25 of the Landlord and Tenant Act 1954 by recorded delivery to three addresses, including the appellant’s last known home address. All letters were returned. Copies were also affixed to the leased premises, which were within a cordoned-off unsafe building.

HH Judge Howarth, sitting in the Chancery Division, dismissed the tenant’s action under CPR 24 on the basis that it had no real prospect of success. The tenant appealed, challenging service. The central issue was whether either postal service or affixing the notice to inaccessible premises validly terminated the tenancy.

1. Appeal dismissed unanimously. Lord Justice Robert Walker held that either of the two postal routes was sufficient to validate the statutory termination notice. Lord Justice Carnwath agreed on those grounds. Lord Justice Schiemann adopted Robert Walker LJ’s reasoning on the dispositive issues.
2. Section 25 of the Landlord and Tenant Act 1954, applied in accordance with Scholl Mfg Co Ltd v Clifton (Slim-Line) Ltd [1967] Ch 41, substitutes the statutory notice for contractual provisions by which the tenancy would otherwise be ended by the landlord. The respondent therefore did not need to establish separate valid service of a contractual break notice.
3. On the lease’s construction, its express provision that notice to the tenant was validly served if sent by post to the last known address in Great Britain did not incorporate the non-return condition found in section 196(4) of the Law of Property Act 1925. Nor could “sent ... by post” be read as requiring actual delivery. The recorded letter sent to the appellant’s last known home address therefore constituted contractual service despite its return.
4. Independently, section 23(1) of the Landlord and Tenant Act 1927, as applicable to the statutory notice, contained no exception for returned letters. No argument was advanced that section 7 of the Interpretation Act 1978 displaced that result. Service under section 23(1) was accordingly effective.
5. The judges did not reach a common conclusion on affixing the notice to the cordoned-off premises. Robert Walker LJ would have held it effective because it was part of a genuine attempt to communicate and involved no bad faith. Carnwath LJ expressed no view and cautioned against reliance on a notice which nobody could see. Schiemann LJ would have found service ineffective if that were the sole basis, because the landlord knew its safety measures prevented access. That issue was unnecessary to the result.

• Court of Appeal (Civil Division): dismissed the tenant’s appeal. Valid postal service of the statutory notice was sufficient to terminate the tenancy.
• High Court of Justice, Chancery Division (HH Judge Howarth): on 24 January 2001, dismissed the tenant’s action under CPR 24 because it had no real prospect of success.