Arrowgame Ltd v Maxwell Brent Wildsmith & Ors

For an acquisition order under Part III of the Landlord and Tenant Act 1987, the statutory notice must give the landlord sufficient detail of the reasons for seeking the order and the facts relied upon. “Grounds” identify the reasons why the court should exercise its discretion; “matters” identify the supporting facts and circumstances.

The requirement to specify remedial steps applies where all the matters relied upon are capable of remedy. It does not require a notice based on a mixture of historic or irremediable matters and remediable matters to postpone the application. The court may dispense with defects in the notice where the statutory purpose has been fulfilled and no prejudice has resulted. An appellate court should interfere with a discretionary acquisition order only on established appellate grounds.

The appeal concerned an acquisition order made by His Honour Judge Cowell on 28 October 2011 under Part III of the Landlord and Tenant Act 1987. The respondents were long lessees of flats at Colebrook Court and had applied to acquire the appellant’s head lease after a manager had been appointed under Part II of the Act for more than two years.

The appellant challenged the validity of the notice served under section 27, argued that any defect should prevent the order, and contended that the judge had wrongly exercised his discretion under section 29(1)(c), including by refusing to suspend the order. The central issues were the meaning of “grounds” and “matters” in section 27(2), the scope of the dispensing power in section 29(6)(b), and the proper approach to appellate review of the acquisition order.

1. Appeal dismissed. The acquisition order was upheld.
2. Section 27 requires a valid notice before an application for an acquisition order. The notice must identify the fundamental reasons why an order is said to be appropriate and the facts or circumstances relied upon to establish those reasons. The grounds and matters need not be itemised separately if the notice sufficiently informs the landlord of the case to be met.
3. Section 27(2)(d) applies where all the matters relied upon for establishing the grounds are capable of remedy. In that event the landlord must be given specified remedial steps and a reasonable period, together with the statement required by section 27(2)(b). Where the case relies on a mixture of matters, including matters incapable of remedy, and the overall problem will not be cured by addressing the remediable matters, section 27(2)(d) is inapplicable.
4. The notice in this case was valid. It explained why the appointment of a manager had not resolved the applicants’ difficulties and set out their complaints in sufficient detail. Alternatively, if the notice had been defective, the court could exercise the power in section 29(6)(b). The notice had fulfilled its purpose, the appellant understood the case, and no prejudice had been caused.
5. The judge applied the correct and demanding test under section 29(1)(c). An acquisition order is appropriate where lesser measures cannot address the established grounds, but the court must still weigh all relevant circumstances. Development potential is not invariably irrelevant, although it may properly receive little weight where the landlord’s conduct otherwise warrants acquisition. The refusal to suspend the order was also within the judge’s discretion because the proposed alternative arrangements were speculative and impracticable.

• High Court (Chancery Division): appeal from the decision of His Honour Judge Cowell dated 28 October 2011. The appeal was dismissed and the acquisition order upheld.