Kahlon v Isherwood

A statutory notice is substantially to the same effect as a prescribed form only if it contains every matter forming part of the form's substance. The tenant’s knowledge and absence of prejudice cannot cure a material omission.

A tenant replacing an existing assured tenancy with an assured shorthold tenancy must serve the prescribed notice before becoming contractually bound to take the new tenancy. The notice must explain and acknowledge the resulting loss of security. Without compliance, the replacement tenancy remains assured and possession cannot be obtained through the accelerated procedure applicable to assured shorthold tenancies.

The tenant appealed against a possession order made by the Coventry County Court. A mediated settlement and Tomlin order provided for his existing assured tenancy to be replaced by a 12-month assured shorthold tenancy. The landlord later served notice and sought possession under section 21 of the Housing Act 1988.

The Recorder held that the Tomlin schedule was substantially to the same effect as the prescribed Form 8 because the legally represented tenant knew and had accepted the consequences of changing his tenancy status. The central issues were whether the schedule satisfied paragraph 7 of Schedule 2A and whether it had been served before the tenant entered into the replacement tenancy.

1. Appeal allowed. The Tomlin schedule was not substantially to the same effect as Form 8. It omitted the prescribed warnings and contained nothing corresponding to the tenant’s acknowledgement that an assured shorthold tenancy would provide materially less security. Those were matters of substance, not formal details.

2. Whether an alternative document is substantially to the same effect as the prescribed form depends upon the purpose of the notice and the materiality of the omitted information. The tenant’s actual knowledge, access to legal advice or lack of prejudice cannot cure the absence of substantive prescribed content. The approach in Manel v Memon [2000] 2 EGLR 40 applied equally to paragraph 7 of Schedule 2A to the Housing Act 1988.

3. Although the paragraph 7 notice is formally served by the tenant upon the landlord, it has a dual protective purpose. It warns the tenant about the loss of security involved in replacing an assured tenancy and provides the landlord with the tenant’s acknowledgement of that consequence. Requiring the tenant to prepare and serve the notice is the safeguard accompanying removal of the former prohibition on such replacement tenancies.

4. The construction approach associated with Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd [1997] AC 749 may correct obvious factual mistakes in a notice. It cannot supply omitted matters of substance. A compliant notice either contains those matters or it does not.

5. Further, although this was unnecessary to dispose of the appeal, paragraph 7(2)(b) requires notice before the assured tenancy is entered into. A document that immediately and specifically binds the tenant to take the new tenancy cannot itself provide the prior notice contemplated by the provision. The required interval gives the tenant an opportunity to consider the consequences and resile before becoming bound.

6. The agreement therefore created an assured tenancy rather than an assured shorthold tenancy. The possession order was set aside and the claim remitted to the County Court for reconsideration on that basis. Stanley Burnton and Rix LJJ agreed with Patten LJ.

1. Court of Appeal (Civil Division): The appeal was allowed in [2011] EWCA Civ 602. The possession order was set aside and the claim was remitted for reconsideration on the basis that the replacement tenancy was assured rather than assured shorthold.

2. Coventry County Court: Mr Recorder Willetts made a possession order on 15 November 2010, holding that the Tomlin schedule sufficiently complied with the prescribed-notice requirements.