Tue 22 Dec 2015

Getting tenant's name wrong in a lease notice

A landlord attempts to serve a notice on its tenant. The notice is sent to the tenant's address and is opened by a director of the tenant - but it contains the wrong name for the tenant company. Is the notice still valid? As of last week, the answer is no. 

This is what happened in West Dunbartonshire Council v William Thompson and Son (Dumbarton) Limited.

Here, the Council was landlord and the tenant was a company called William Thompson and Son (Dumbarton) Limited. The Council served a rent review notice addressed to "Wm Thompson & Sons Ltd".

Instead of looking at the lease, the person at the Council who prepared the notice took information from a Council list of billing information which had been prepared some years previously. Why that list contained the wrong name is not clear, as the tenant company was the original tenant under the lease and had not changed its name since entering into the lease.

The rent review clause said that "it shall be in the power of the Landlords on giving to the Tenants not less than 6 months' notice in writing prior to…"

Although the notice stated the wrong name for the tenant, it was:

  • sent to the tenant's address and
  • received by a director of the tenant.

However, the court decided that these facts were not enough to save the landlord and declared the notice to be invalid.

Key points made by the court

The Scottish court made many references to earlier judgements in both Scottish and English cases.

In particular, the Scottish court referred to the judgement in the 1997 case of Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd including the following points made in that case:

The agreement between the parties provides what notice has to be given to be effective to achieve the relevant result. The question in each case is does the notice comply with the agreed specifications?

The facts that:

  • the person serving the notice plainly intended, and was trying, to give an effective notice; and
  • the recipient realised that the server was so doing, 

make no difference. The key does not fit the lock, so the door will not open. 

If the clause had said that the notice had to be on blue paper, it would have been no good serving it on pink paper, however clear the wording in the notice might have been. 

Looking to the facts of the present case, the court noted that:

  • the Lease set out the tenant's name
  • the Lease entitlement of the Landlord to demand an increase in rent required the Landlord to give the relevant notice to the tenant
  • the notices clause referred to notices being addressed to the tenant
  • the notice was not addressed to the tenant
  • the errors in the name were sufficient to put the case well beyond the example of an obvious mis-spelling of a name such as was discussed in some earlier cases and
  • the fact that the notice was received by the tenant and opened by one of its directors was not relevant.

The court disagreed with the Landlord's argument that for an error to invalidate a notice there must be something in the error which might mislead the recipient. The notice was not valid because it did not comply with the contractually agreed requirements of the Lease. 

Good practice 

In some cases a minor error will not invalidate a notice - but it can be difficult to predict how minor an error has to be to for it to be disregarded. And why take the risk, when all that is required is some attention to detail.

Morton Fraser (as do many solicitors) have protocols and checklists to be used when serving notices under leases - which include double checking all relevant details and carrying out searches to check for any changes of name and address. The extra time and cost involved in making these pre-notice service checks is well worth it to ensure the validity of a notice.

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