Inter Naturalia Problems with Notices Ken Gerber Anderson Strathern, Solicitors, Glasgow 24 th April 2014

Inter Naturalia Common law rule “Ordinary and normal obligations” Enforceable between original parties only? Or bind singular successors? Statutory real right does not imply enforceablilty of all clauses

Obligations that continue Repairs Not to derogate from grant Permanent change to rent payment Rent review Title / statutory compliance Contractual compensation for improvements Service charge cap Rent deposit obligations Guarantees (generally)

Obligations that do NOT continue Provisions that are stated to be personal Option to lease another property Rent reduction for services from a particular tenant / personal provision Rent retention to set off against private debt Right to use another part of landlord’s property no longer owned Buy back rights Pre-emption rights Tenant’s option to purchase

Grey Areas – may / may not continue Break options Use variation Option to renew or extend Exclusivity clauses – Optical Express v M & S Warren james v Overgate

Protecting the personal clause Standard security Does not do the job, unless decree of foreclosure Remedy of sale Prior ranking security can defeat Defective title policy?

NOTICES Procedure Follow instruction in lease re writing, timing and service. Prevent tacit relocation by verbal or written notice. Service - mandatory or sufficiency. Muir Construction Limited v Hambly Limited L Batley Pet Products Ltd v North Lanarkshire Council

Pre-Irritancy Notices Section 4 of the Law Reform (Miscellaneous Provisions) (Scotland) Act 1985 Ethel Austin Properties Holdings Limited v D & A Factors (Dundee) Limited Kodak Processing Company Limited v Shoredale Limited Proving service of a notice In Chaplin v Caledonian Land Properties Ltd[1], A notice is presumed to have been received unless the (supposed) recipient can prove it has not been received.[1] [1] Chaplin v Caledonian Land Properties Ltd 1997 SLT 384 [1]

Notice to wrong Landlord Ben Cleugh Estates Limited v Scottish Enterprise Batt Cables plc v Spencer Business Parks Limited safer to assume notice not addressed to the correctly named landlord will fail

Notice from wrong Tenant AWD de Vere Wealth Management Limited v Melville Street Properties Limited Notice given by only one out of two joint tenants - Prudential Assurance Company Ltd v Exel UK Ltd - fails Period of notice Esson Properties Ltd v Dresser UK Ltd[1] - not less than nine months notice[1] Esson Properties Ltd v Dresser UK Ltd 1997 SLT 949

Error in Notice Mannai Investment Co. Limited v Eagle Star Life Assurance Co. Limited - reasonable recipient test Scrabster Harbour Trust v Mowlem plc (t/a Mowlem Marine) Lay v Ackerman, - error in landlord’s name in his counter notice was ok. Capital Land Holdings Limited v Secretary of State for the Environment – registered office Lemmerbell Limited and Matthew Fraser Limited v Britannia L.A.S. Direct Limited (formerly L.A.S. Direct Limited) - tenant’s solicitors issued the notice but wrongly named the tenant. Not valid because no agency.

Exercising break option – coming unstuck Avocet Industrial Estates LLP v Merol Ltd – interest not demanded PCE Investors Ltd v Cancer Research – need to over-pay rent

Contact me………. Ken Gerber Anderson Strathern, Glasgow