Dagger v Shepherd

 

Dagger v Shepherd

LANDLORD AND TENANT; Tenancies

COURT OF APPEAL

SCOTT AND TUCKER LJJ AND EVERSHED J

29, 30 OCTOBER, 6 DECEMBER 1945

Landlord and Tenant – Notice to quit – “On or before” – Construction – Rent and Mortgage Interest Restrictions (Amendment) Act, 1933 (c 32), s 3, Sched I

(h)

The appellant was the landlord of a house to which the Rent Restrictions Acts applied. The house was let to the respondent under an agreement for one year

from 25 March 1939, at a rent of £50 per annum. The agreement further provided that the respondent was to have the option of remaining on the premises

thereafter as a quarterly tenant, subject to a determination of the tenancy by 3 months’ notice. The respondent stayed on for a number of years without

expressly exercising his option. On 20 December 1944, the appellant’s agent served the respondent with written notice to quit “on or before 25 March next.”

The appellant then brought an action for possession on the ground that the alleged contractual tenancy had been duly determined by the notice to quit. At the

trial the county court judge, without considering any other questions raised in the pleadings, dismissed the appellant’s claim on the ground that the phrase “on

or before” in the notice to quit rendered it uncertain and ambiguous. The appellant appealed:—

Held – The notice to quit served on the respondent was valid and effective, since it specified the date, ie, 25 March 1945, on which the tenancy was to end.

The insertion of the words” on or before” in the notice to quit was, on a proper construction, an offer to the tenant to accept from him a determination of the

tenancy on any earlier date than that named on which he would give up possession of the premises.

Notes

It is essential to the validity of a notice to quit that it should be certain; that there should be “plain unambiguous words claiming to determine the existing

tenancy at a certain time.” What then is the effect of a notice to quit “on or before” a specified date? As regards a covenant to pay a sum of money Parker J,

observed in the Tewkesbury Gas Co case that “a covenant to pay on or before a certain day creates a liability to pay on the day named with an option of earlier

payment,” and this reasoning appears to be equally applicable to a notice to quit. The contrary view, as expressed by Lush J, in Queen’s Club Gardens Estates

v Bignell, is held to be erroneous. Such a notice, therefore, amounts to notice to quit at a date certain, unless the tenant chooses to accelerate the date by an

earlier delivery up of possession.

As to Construction of Notice to Quit, see Halsbury, Hailsham Edn, Vol 20, pp 135–138, paras 145–147; and for Cases, see Digest, Vol 31, pp 445–450,

Nos 5919–5971.]

􀂭 133􀀉

Cases referred to in judgments

Phipps (P) & Co (Northampton and Towcester Breweries) Ltd v Rogers [1925] 1 KB 14, 31 Digest 448, 5947, 93 LJKB 1009, 132 LT 240.

Gardner v Ingram (1889), 61 LT 729, 31 Digest 446, 5931.

Hankey v Clavering [1942] 2 All ER 311, [1942] 2 KB 326, 111 LJKB 711, 167 LT 193.

Re Tewkesbury Gas Co, Tysoe v Tewkesbury Gas Co [1911] 2 Ch 279, 17 Digest 352, 1628, 80 LJCh 590, 105 LT 300.

Queen’s Club Gardens Estates Ltd v Bignell [1924] 1 KB 117, 31 Digest 447, 5932, 93 LJKB 107, 130 LT 26.

De Vries v Sparks (1927), 137 LT 441, Digest Supp.

Ahearn v Bellman, Sedgwick v Ahearn (1879), 4 Ex D 201, 31 Digest 446, 5926, 48 LJQB 681, 40 LT 771.

Appeal

Appeal by the plaintiff from an order of His Honour Judge Cave KC dated 4 July 1945, and given at Poole County Court. The facts are fully set out in the

judgment of the court delivered by Evershed J.

W R Rees-Davies for the appellant.

F W Beney KC and E S Fay for the respondent.

Cur adv vult

6 December 1945. The following judgments were delivered.

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SCOTT LJ. I will ask Evershed J to read the judgment of the court.

EVERSHED J [delivering the judgment of the court]. This is an appeal from an order of the Poole County Court dismissing with costs the action of the

appellant, the landlord of certain premises known as “Kenwood,” Poole Road, Wimborne, in Dorset. The claim of the appellant was for an order for

possession of the premises, which were and are in the occupation of the respondent, and for consequential relief. The premises were and are within the

protection of the Rent Restriction Acts.

By her points of claim the appellant alleged that the premises were occupied by the respondent under the terms of an agreement dated 25 March 1939,

and that “the said tenancy was duly determined by notice to quit dated 20 December 1944, and expiring on 25 March 1945.” The appellant then alleged facts

designed to bring the case within para (h) of the First Schedule to the 1933 Act. The particulars of defence in substance put in issue the whole of the matters

alleged by the points of claim.

It is to be observed that the appellant founded her case exclusively on an alleged contractual tenancy duly determined by the above-mentioned notice to

quit. There was no alternative claim founded on a statutory tenancy under the Rent Restriction Acts entitling the judge without any such notice to quit to order

possession to be given to the appellant; nor was any application to amend the claim made at the hearing in the county court. Upon the action coming on for

trial the point was taken that the alleged notice to quit was on the face of it invalid or ineffective. The county court judge so decided, with the result that the

claim as pleaded failed in limine and was dismissed with costs.

The terms of the notice to quit were as follows:

‘Dear Sir, On behalf of our client, Mrs. W.A.M. Dagger, we hereby give you notice to quit “Kenwood” on or before Mar. 25, next. As we have

already informed you, Mrs. Dagger requires possession of the house in order to occupy it herself with members of her family. Please acknowledge the

safe receipt of this letter. Yours faithfully.’

The ground of the judge’s decision was that the insertion of the words “or before” in the phrase “notice to quit on or before 25 March” rendered an otherwise

good notice uncertain and ambiguous and was, accordingly, fatal to its efficacy. In so holding, the judge was following, as we were informed, previous

decisions of his own and of other county court judges.

The argument by counsel for the appellant before this court was two-fold. His first contention was that upon its fair and reasonable construction the

document of 20 December 1944, meant, and must have meant, that the landlord gave notice terminating the alleged tenancy on 25 March 1945, the words “or

before” having only the effect of conferring upon the tenant an option of vacating the premises on an earlier date of his own choice and thereby terminating the

tenancy on such earlier date. His second, and alternative, contention was that, even if the letter of 20 December 1944, was ineffective to determine a

contractual tenancy, nevertheless the county court judge should (since the premises fell within the scope of the Rent Restriction Acts) have examined the

available evidence in the case, both written and oral; that, had he done so, he would 􀂭 134􀀉 or might have found that in truth the tenancy had before the date

of the hearing ceased to be a contractual tenancy and had become a statutory tenancy; and that accordingly the invalidity of the notice of 20 December 1944,

did not affect the appellant’s right to possession. He asked, therefore, for a new trial on the ground that the county court judge was both entitled and bound to

examine the available evidence notwithstanding the form of the appellant’s points of claim and the absence of any application to amend, in order to apply the

criteria of para (h) of Sched I to the 1933 Act.

The first branch of the appellant’s argument raises a question of general importance, namely, whether in the absence of some special context (and we do

not think any special context is to be found in the present case) the use in a notice to quit of the disjunctive phrase “on or before” in relation to a fixed date

invalidates the notice on the ground of uncertainty. It is well-established that a notice to quit, being a “unilateral act” in exercise of a contractual right to put

an end to an existing relation of landlord and tenant, must conform strictly to the legal requirements of the contract. Accordingly, in Phipps v Rogers, Atkins

LJ quoted with approval the passage in Gardner v Ingram where Lord Coleridge, CJ; stated (61 LT 729, at p 730):

‘Although no particular form need be followed, there must be plain unambiguous words claiming to determine the existing tenancy at a certain

time.’

We refer also to the language of Lord Greene MR, in Hankey v Clavering, in regard to notices to quit to which our attention has been directed ([1942] 2 All

ER 311, at p 313):

‘That takes me back to the real point in the case, namely, whether or not the notice was a good notice, that is to say, whether it had the effect of

terminating the lease on Dec. 25, 1941. Notices of this kind, given under powers in leases of this description, are documents of a technical nature,

technical for this reason, that if they are in proper form they have of their own force without any assent by the recipient the effect of bringing the demise

to an end. They are not consensual documents; they are documents which must do the thing which the proviso in the lease says they are to do; they

must on their face and on a fair and reasonable construction do what the lease says they are to do. It is perfectly true that in construing such a document,

as in construing any other document, the court in case of ambiguity will lean in favour of reading the document in such a way as to give it validity as a

document; but I dissent entirely from the proposition that, where a document is clear and specific on a particular matter, such as that of date, it is

possible to ignore the inaccurate reference to a date and substitute a different date because it appears that the date was put in by a slip.’

There is a further general principle to be applied. The court must assume that the parties to the contract of tenancy are aware of its terms, particularly of the

provisions relative to its termination: see, for example, Phipps v Rogers, per Atkin LJ ([1925] 1 KB 14, at p 27).

Bearing these general principles in mind, the question for our determination is solely one of interpretation. What, upon its fair and reasonable

construction, does the document of 20 December 1944, mean? Is the tenant left by its terms in any doubt as to its intended effect? On the one hand, does the

document, when correctly construed, contain a statement that the landlord intends to treat the relationship of landlord and tenant as determined upon some

unspecifed (and therefore uncertain) date between 21 December 1944 (the day following the date of the document) and 25 March 1945? Or does it contain an

unequivocal statement to the tenant that on 25 March 1945, the rights and obligations of his tenancy, including his right to possession of the premises, will

come to an end, at the same time giving to him an option to deliver up possession at some earlier date of his own choosing? And if some such option is given,

is it one impliedly subject to the condition of the tenant’s continuing under the obligations of the tenancy—such as payment of rent—until 25 March 1945? Or

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is it an option to bring the tenancy to an end for all purposes on the date when he in fact evacuates the premises? In short, is the true interpretation, “I give you

notice that the tenancy will end on the named date, but, in case it suits you better to end it earlier, I here and now make you an offer to end it at any earlier date

you like upon your accepting my offer”?—such offer being open to acceptance, presumably, by oral or written word or by conduct.

In our judgment, and treating the matter as one of the construction of the document without reference to any authority, its true effect was first to give

􀂭 135􀀉 to the tenant notice that the landlord did thereby give an irrevocable notice to determine on 25 March 1945, and secondly, to make to the tenant an

offer to accept from him a determination of that relationship on any earlier date (of the tenant’s choice) on which the tenant should give up in fact possession

of the premises.

If the view we take of the construction of the material phrase is well-founded, it follows that a notice to quit “on or before” a fixed date is prima facie

valid and effective. Nor, as it seems to us, would the result be different if the option given to the tenant is not to determine the tenancy by the vacating of the

premises on some date earlier than that named in the notice, but is an option merely to give up possession at such earlier date without any corresponding right

to treat his obligations as a tenant as thereby determined. In both cases the effect is that the landlord intimates his intention to treat the tenancy as coming to

an end on the certain date named in the notice, giving to the tenant an opportunity of further altering his position at some earlier time if he elects so to do. As

regards the option, the next step is with the tenant. So far as the landlord is concerned, he has stated his position and thereby taken the step of finally fixing

the end of the tenancy. Whether he could thereafter withdraw his offer to accept from the tenant an earlier determination, we need not discuss.

In this connection it is to be borne in mind that, as pointed out during the argument, the notice to quit, though in form only calling upon the tenant to do a

particular act (namely, to vacate the premises), is beyond doubt intended upon its taking effect to put an end altogether to the relation of landlord and tenant.

Though in terms such intention is not expressed, no one, we think, could for a moment be in doubt upon it. The intention must be read into the notice because

that is its plain meaning. The tenant is called upon to “quit” on the named date simply because his right to remain will then have ceased. So read, the words

“or before” necessarily import the offer: “But if you like to quit the premises on any day before that, I here and now give you my consent.”

The alternative construction is to read the document as equivalent to a notice by the landlord that he intends to terminate the tenancy at some unspecified

date not later (and perhaps earlier) than the date stated in the notice. So to construe it would import a claim of right to terminate on a shorter notice than the

contract (arising by virtue of the quarterly option) would allow; and to construe the document as importing an intention to break the contract must be wrong if

there is another equally natural meaning which imports no breach. The maxim ut res magis valeat quam pereat applies. A similar conclusion follows from

the uncertainty which that construction must inevitably (but unnecessarily) create. Such a notice would leave the initiative entirely with the landlord, and the

tenant could not on the face of it know at what date in fact the landlord proposed to regard the tenancy as determined and to evict him, save that it would not

be later than the date specified in the notice. If that were the true meaning of the notice it would obviously be so uncertain as to be invalid. Such a notice

must of necessity import that the landlord has not yet decided upon the actual date for the termination of the tenancy and that he will have to take some further

step, and notify the tenant accordingly when his decision has been made. In other words, this alternative construction of the notice not only makes it bad for

uncertainty but also deprives it of that quality of finality which above all else a notice to quit must possess.

The use of the phrase “on or before” some fixed date is to-day by no means uncommon, particularly in covenants or demands for payment of money, and

in such a context it cannot, in our judgment, be open to serious doubt that it means, and would be understood to mean that the covenantor or debtor is under

obligation to pay the debt on (but not earlier than) the date fixed but has the option of discharging it at any earlier time selected by him: see Re Tewkesbury

Gas Co, per Parker J ([1911] 2 Ch 279, at p 284). In our judgment that reasoning is equally applicable to a notice to quit and to a covenant or demand for the

payment of money.

We turn now to the decided cases to which our attention has been drawn in the course of the argument. Three cases have been cited to us in which the

phrase “on or before” has been judicially considered in reference to the termination 􀂭 136􀀉 of the relationship of landlord and tenant (all being cases before

Divisional Courts), namely: Gardner v Ingram, Queen’s Club Gardens Estates, Ltd v Bignell, De Vries v Sparks. In the first and third of these cases the

question before the court was the effect, not of a notice to quit served by a landlord upon a tenant, but of a document addressed by a tenant to his landlord

referring (in the one case) to an intention to surrender on the part of the tenant, and (in the other case) to an alleged agreement for surrender “on or before” a

named date. In each case the decision of the court was based primarily upon the ground that the document in suit was not a notice to quit but (in the former

case) was an expression of an intention “to do something which could not be done without the landlord’s consent” and (in the latter case) amounted to an

attempt to set up an agreement the existence of which was not established. But in Gardner v Ingram, Bowen J emphasised (61 LT 729, at p 730), in reference

to the facts of the case, the general principle that a notice, if effective to determine a tenancy, “must be plain and unequivocal in its terms, leaving no doubt as

to the intention of the party giving it”; and in De Vries v Sparks, Salter J said (137 LT 441, at p 443), that if the document there in suit was to be regarded as a

notice to quit, it was ineffective as not being expressed (by reason of the use of the phrase “on or before”) to expire on a fixed date.

In our judgment both these cases are distinguishable from the present. In both cases, as already stated, the documents relied upon as determining the

tenancy were held not to be notices to quit at all. But assuming that the documents in the two cases should be considered as notices to determine the respective

tenancies, it will be observed that they were notices served by the tenants of proposed surrender on their part. They did not call upon the respective landlords

to do anything. They informed the landlords that “on or before” the relevant named dates the tenancies would be surrendered. The initiative rested with the

parties giving the notices. The parties receiving the notices were in such circumstances left wholly uncertain of the dates on which in fact the tenants would

take the initiative and claim that the tenancies were at an end. On principle, therefore, and for the reasons which we have already attempted to state, these

cases cannot be cited as authorities applicable to a notice to quit given by a landlord to a tenant in which on the face of the document the initiative in selecting

some date earlier than the date specified is left entirely with the party to whom the notice is addressed.

Queen’s Club Gardens Estates Ltd v Bignell is more directly in point. In that case the landlord purported to determine a tenancy by giving to the tenant

“the requisite week’s notice for termination of the tenancy one week from Monday next on or before which date they will require vacant possession.” It is to

be observed that in this case the notice distinguished in terms between the date fixed by the landlord for termination of the tenancy (namely, “one week from

Monday next”) and the delivery up by the tenant of possession (which was left to be selected by the tenant on any date in the meantime). It was proved in fact

that the tenancy was a weekly tenancy ending on the Saturday in each week, and the decision of the court (Lush and Acton JJ), was to the effect that the notice

to terminate, being expressed to refer to the wrong day of the week, was ineffective. Lush J however, made the following observations ([1924] 1 KB 117, at p

122):

‘I may say that I very greatly doubt whether a notice to quit, assuming it to be free from objection in other respects, can be said to be valid in which

the landlord mentions a specific date for the termination of the tenancy and adds that “on or before” that date they will require possession. A notice to

quit must be certain and definite, and I am by no means sure that a notice to quit in that form is a certain and definite notice to quit on the day specified.

It may be that it is a notice that the landlord will require possession before that day, and, if so, it seems obvious that it must be a bad notice to quit. That

view is, no doubt, somewhat technical, and it may be that the more reasonable interpretation of the notice is to read it as meaning merely that if the

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tenant likes to give up possession before the day specified, the landlord is willing to take it; but I have great doubt whether it is right to put so favourable

an interpretation as that upon this notice to quit. I am not going to rest my judgment upon these last words of the notice, but leave the question of their

interpretation without expressing any definite opinion with regard to it, because in my view, apart altogether from these words, this notice to quit is

invalid.’

􀂭 137􀀉

There is no doubt that Lush J, in the passage quoted, indicated that in his view the use of the phrase “on or before” in relation to the date specified for the

termination of the tenancy rendered the notice to quit so doubtful in meaning and intention as to be invalid. With all respect to that judge, we are unable to

share his opinion. In our judgment, the fair and reasonable construction of the notice to quit before him was that the landlords gave a final notice purporting in

any event to terminate the contract of tenancy on the Monday week following the date of the notice but gave at the same time to the tenant the option of

quitting the premises on an earlier date chosen by him and thus terminating the contract of tenancy on that earlier date. In so far as the above decisions express

a different view from that now expressed by this court, they are in our judgment erroneous. But in the light of the decisions, and of the dicta to which we have

referred, we think that the county court judge had no alternative to deciding as he did.

Before leaving the authorities we wish to refer to Ahearn v Bellman. In that case the landlord had given to his tenant notice to quit the premises in

question “on or before the 1st May, 1878,” but added a further notice to the effect that if the tenant continued in possession after 1 May 1878, an enhanced rent

would be payable by him. The argument turned solely upon the question whether the final provision wholly invalidated the notice to quit. The majority of the

court (Bramwell and Cotton LJJ), allowing the appeal, held that it did not. It is in our view significant that so far as can be observed from the report no point

was taken either in the court below or in the argument before the Court of Appeal, or by Brett LJ, (who dissented from the majority of the Court of Appeal) on

the use of the disjunctive phrase “on or before.” Though the case cannot be regarded as an authority upon the point now before us, it shows at least that to no

one concerned in that case did the use of the phrase in itself suggest uncertainty or ambiguity.

The result is that in our judgment the county court judge was wrong in dismissing the action upon the point of law arising on the form of the notice. The

appeal must, therefore, be allowed and the case referred back to another county court judge (in accordance with our usual practice) for consideration by him of

all the other matters raised by the pleadings—including the question whether the tenancy of the respondent had, by exercise of the option, become

determinable by a three months’ notice at all; and although, if the tenancy had become quarterly, the notice to determine it was good, the judge will still have

to exercise his discretion under sect 3(1) and the Schedule, para (h), of the 1933 Act. The contention that the tenancy passed out of contract into status under

the Rent Restriction Acts, by reason of the letter of 19 March 1943, is not open unless leave to amend the points of claim is asked for and granted by the new

trial judge; and that would be an entirely new case.

The judgment below must be set aside and the whole action re-heard before another judge. The appellant will have the costs of the appeal; the costs of

the first trial will abide the event of the new trial.

Appeal allowed with costs. Judgment below set aside and the whole case remitted for re-hearing.

Solicitors: Hughes, Hooker & Co (for the appellant); Barnes & Butler agents for J W Miller & Son, Poole (for the respondent).

C StJ Nicholson Esq Barrister.

􀂭 138􀀉

[1946] 1 All ER 139