26 March 1999
Ballard (Kent) Ltd v Oliver Ashworth (Holdings) Ltd
Court of Appeal (Lord Justice Stuart-Smith, Lord Justice Robert Walker and Lord Justice Laws) 18 March 1999
ON THE true construction of s 18 of the Distress for Rent Act 1737 the right to double rent only arose where the tenant holding over after his own notice to quit was in fact a trespasser, and the landlord had treated him as such.
The Court of Appeal allowed the appeal of the defendant tenant against decisions in favour of the plaintiff landlord on two summonses issued under Order 14A of the Rules of the Supreme Court in proceedings for the recovery of rent.
A dispute had arisen between the landlord and the tenant concerning a lease between them which provided by clause 12(i) that the tenant should have an option to determine the lease at the expiration of the first 10 years and six months of the term by giving "at least six months' previous notice in writing prior to the determination date", and by clause 12(ii) that the tenant should continue to be liable for rent and service charge for a period of up to a year, if after the term had been brought to an end under clause 12(i) the landlord could not re-let on satisfactory terms.
The tenant gave notice of its intention to determine the lease, but the landlord issued proceedings contending that because of an error as to the date of determination, the notice to determine the lease was invalid.
Although the tenant's position was that it had validly exercised the option under clause 12(i), it remained in occupation of the demised premises. The master made an order declaring that the lease had been validly determined. The landlord subsequently issued a summons for judgment for interest on the sum claimed as rent due which had been paid by the tenant.
Two summonses under RSC Ord 14A were issued by the landlord, posing questions of law which raised issues concerning double rent under the Distress for Rent Act 1737; election; waiver; and the rule against double recovery. The judge decided both summonses in favour of the landlord, and the tenant appealed.
Paul Morgan QC and Nicholas Taggart (Cripps Harries Hall) for the landlord; Jonathan Brock QC and Philip Rainey (Rowe & Maw) for the tenant.
Lord Justice Laws said that the argument for the tenants to the effect that the respondents had waived their right to double rent by election could not succeed. Common law waiver or waiver by election proceeded upon the premise that the party said to be fixed by the waiver had to have possessed two or more substantive but inconsistent rights.
In such a case his choice by overt act, communicated to the other party, to rely on one such right precluded him from later claiming the benefit of another. In the present case the landlord had had no choice of substantive rights. The tenant's break notice had been good, and the landlord had therefore possessed no right to treat the tenancy as continuing.
The question whether the landlords were entitled to double rent under section 18 of the Distress for Rent Act 1737 turned, however, not on any question of waiver, but on the correct interpretation of the statute, the true scope of which had to be ascertained by reading it with the Landlord and Tenant Act 1730, for they were to be read as a single code.
On the true construction of section 18 of the 1737 Act, the right to double rent only arose where (a) the tenant holding over after his own notice to quit was in fact a trespasser; and (b) the landlord had treated him as such. Reading the 1737 Act and the 1730 Act as a whole, including the preambles and recitals to the 1737 Act, it was entirely clear that the legislature was concerned only to compensate landlords for the potential loss of rent arising where a tenant held over against the landlord's insistence that he should comply with his own notice to quit.
On the undisputed facts in the present case, the claim for double rent lay outwith the right conferred by section 18 of the 1737 Act.
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