Northwood (Solihull) Ltd v Fearn

The Court of Appeal considered whether two landlord documents given to residential tenants were validly authenticated: (i) the tenancy deposit certificate required by section 213 of the Housing Act 2004 and the Housing (Tenancy Deposits) (Prescribed Information) Order 2007 (article 2(1)(g)(vii)); and (ii) a notice seeking possession under section 8 of the Housing Act 1988. The central legal principles were agency and attribution (the extent to which a company’s acts can be performed by natural persons on its behalf), the execution formalities in section 44 of the Companies Act 2006, and the modern approach to non-compliance with statutory formalities (Osman/Elim Court): whether substantial compliance fulfils the statutory purpose.

The court held that the confirmatory deposit certificate signed by a director acting for the company was valid both under the meaning of "landlord" in section 212(9) of the Housing Act 2004 and, alternatively, as substantially in the prescribed form required by section 213(6) and article 2. The section 8 possession notice signed by the landlord’s authorised agent was also valid because the primary statute and the prescribed form permitted signature by an agent and the document fulfilled the statutory purposes. The court therefore dismissed the tenant’s appeal against the section 8 notice and allowed the landlord’s cross-appeal concerning the certificate.

Background and parties: The case concerned Northwood (Solihull) Ltd (landlord) and tenants Mr Fearn and Ms Cooke. A deposit was paid on 25 July 2014 and a confirmatory certificate was served; later rent arrears led to a possession notice under section 8 served 27 March 2017. The tenants pleaded a defence that both documents were invalid because not authenticated in the manner required by section 44 of the Companies Act 2006.

Procedural posture: At first instance Saini J held that the deposit certificate was invalid absent execution in the manner of section 44 but that the section 8 notice was valid. Both decisions were appealed to the Court of Appeal: the tenants appealed the conclusion about the section 8 notice and the landlord cross-appealed the conclusion about the certificate.

Nature of relief sought: The litigation concerned the validity of documents relied on in possession proceedings; the tenants sought to rely on defective authentication as a defence to those proceedings.

Issues framed:

• Whether the deposit certificate had to be executed by the company in the strict terms of section 44 Companies Act 2006, and if not, whether it was nevertheless valid or substantially in the prescribed form required by section 213 and the 2007 Order.
• Whether the section 8 notice had to be signed by the company rather than by an authorised agent, and the consequences of any procedural defect.
• What consequences, if any, flow from non-compliance with the prescribed formalities (whether strict invalidity or permissible substantial compliance), applying the modern approach in Osman and subsequent authority.

Court’s reasoning: The court applied established principles of agency and attribution (including the company’s constitutional and statutory rules) and the Interpretation Act 1978 to read subordinate legislation in conformity with the primary statute. It held that "landlord" in the 2007 Order was read with section 212(9) of the Housing Act 2004 so as to include persons acting on the landlord’s behalf; accordingly a director or authorised agent signing for the company satisfied the certification requirement. Alternatively, the certificate was substantially in the required form under section 213(6) because it contained all prescribed information, had been signed by an authorised person, and fulfilled the statutory purpose. The section 8 notice complied with primary legislation and prescribed forms that expressly allow signature by an agent; an immaterial rubric error did not defeat the notice. The court also applied the Osman/Elim Court approach to conclude that any technical non-compliance was not fatal where the statutory purpose had been achieved.

Subsidiary findings and wider context: The court distinguished but did not wholly reject Hilmi; it emphasised that that case concerned different statutory language and that the Housing Act and the 2007 Order expressly contemplated agents. The judgment notes the limited value of treating formal defects as a "trap for the landlord" where statutory purposes are satisfied.

The Court of Appeal dismissed the tenant’s appeal and allowed the landlord’s cross-appeal. Rationale: the deposit certificate was valid because the definition of "landlord" in section 212(9) of the Housing Act 2004 and article 2(3) of the 2007 Order permitted signature by a person acting on the landlord’s behalf (and, in any event, the certificate was substantially in the prescribed form); the section 8 possession notice was valid because primary legislation and the prescribed form expressly permitted signature by an agent and the notice fulfilled its statutory purposes. Minor rubric errors did not invalidate either document under the modern substantial-compliance approach to statutory formalities.

Appeal from the Queen's Bench Division (Saini J) where the judge had held the deposit certificate invalid unless executed in the manner required by section 44 Companies Act 2006 but held the section 8 notice valid: [2020] EWHC 3538 (QB), [2021] 1 WLR 1937. The Court of Appeal allowed the landlord's cross-appeal and dismissed the tenant's appeal: [2022] EWCA Civ 40.