Leslie Blohm QC and Christopher Jones win as the Court of Appeal interprets service provisions for Agricultural Notice to Quit
22nd May 2017
Leslie Blohm QC and Christopher Jones, barristers within St John’s Chambers’ agriculture & rural affairs team, have recently appeared for the successful tenant as the Court of Appeal interprets service provisions for agricultural Notice to Quit.
The Court of Appeal has held that a notice to quit was not properly served and so did not determine a farm business tenancy under the Agricultural Tenancies Act 1995.
Section 36(2)(c) of the Act provides that any notice or document required or authorised to be served under the Act is duly served if it is given to him in a manner authorised by a written agreement made, at any time before the giving of the notice, between him and the person giving the notice. So it’s easy to serve a notice to quit – you just follow the instructions in the lease, right? In Grimes v. Trustees of Essex Farmers and Union Hunt  EWCA Civ 361 the lease provided that ‘Either party may serve any notice (including any notice in proceedings) on the other at the address given in the Particulars or such other address as has previously been notified in writing’. The tenant did notify the landlord of another address, but the landlord served notice to quit at the address stated on the front of the lease anyway. The judge held that the notice was good – the landlord could serve the notice at either address, at his option. It meant what it said, and it gave the landlord a choice. It mattered not that different wording might have produced a fairer or less arbitrary result – see Arnold v. Britton  AC 1619. The tenant had therefore been rightly evicted (the landlord had simply put another farmer into possession) and his claim for two years of lost profits (representing the profits from the occupation he would have had, had the landlord served a valid notice to quit at that time) failed.
The Court of Appeal (Beatson, Henderson, Macur LJJ) disagreed with the Judge. Whilst his view may have been the literal meaning of the provision (and the Court of Appeal were state whether they agreed with that, although their close textual analysis suggested not – see Henderson LJ at ), it was not its purpose. If one party gave the other a new address for service, it was plainly intended to be substituted for the earlier stated (and presumably now redundant) address. As the Court mused, it was not easy to see what the point of enabling a party to provide an up to date address in what was effectively a six year lease if the other party could disregard it. Although in some cases ‘or’ might be interpreted as ‘and/or’ (see Federal Steam Navigation Co Ltd v Department of Trade and Industry  1 WLR 505) this was not one of them.
The case is only the second decision in which the Court of Appeal has applied the Supreme Court’s most recent decision on construction (Wood v Capita  2 WLR 1059) which rationalises what was considered to be the more ‘literalist’ approach of Arnold v Britton to the construction of contracts with the ‘purposive’ approach of Rainy Sky v Kookmin  1 WLR 2900, essentially by stating that Arnold v Britton did not affect the Rainy Sky principles. Henderson LJ considered that the Judge had erred by conducting “a literalist exercise focused solely on a parsing of the wording of the particular clause” to quote Lord Hodge in Wood v. Capita. The judge had gone wrong by starting with a consideration of the literal meaning and then asking himself whether that was plainly wrong, rather than by considering the ordinary meaning of the words in their context.
As a further point, it is also worth noting the rather short shrift given to an attempt by the landlord to challenge the judge’s factual finding that the tenant had sent the landlord his new address. This was a factual finding not to be lightly interfered with; the landlord’s submission on appeal was hopeless. Appellate courts had recently reconsidered the correct approach to such appeals, and where the challenge was to a factual decision relating to a finding of primary fact, the appellate court had to consider that the judge below was ‘plainly wrong’; this meant that no reasonable judge could have come to that conclusion – see Lord Reed in Henderson v Foxworth Investments Ltd  1 WLR 2600 and Lord Hodge in Beacon Insurance Co Ltd v Maharaj Bookstores Ltd   4 All ER 418. That is plainly a very difficult hurdle to surmount, and it may be that it was one that was more likely to be raised in a respondent’s notice (where permission is not required) than on a straight appeal.
Leslie Blohm QC and Christopher Jones of St. John’s Chambers, instructed by Roythornes, represented the successful appellant.
If you would like to instruct Leslie or Christopher on a commercial or chancery matter, please contact their clerks: [email protected] or 0117 923 4740.