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Rent review notices

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Rent review notices

This page deals with two cases on notices:
  • Defective notices - late notice and defective counter-notice.
  • Service of notice - address for service

Defective notices

Late notice and defective counter-notice

Lancecrest Ltd v Asiwaju
[2005] EWCA Civ 117

There were two issues in this case:
  • Whether a trigger notice served by a landlord purportedly implementing a rent review was valid, notwithstanding the fact that it was served 54 weeks later than the cut-off date envisaged by the rent review clause.
  • If the landlord's trigger notice was valid, whether the tenant had served a valid counter-notice challenging the rent specified in the trigger notice. The tenants letter actually challenged the validity of the landlords notice. It said "Your notice or demand is invalid Until you serve me with a valid one-year notice about future rent review ... I will not enter into any arbitration."
Held:

The trigger notice was valid because time was not of the essence:
    Apart from the fact that there is nothing in that sub clause expressly stating or even implying that time is to be of the essence, there is the fairly telling point that, by contrast, there is the express provision that time is to be of the essence in respect of the counter-notice prescribed by the following provision (Neuberger LJ).
There was really no prejudice to the tenant because:
    the day after the review date, the tenant can make time of the essence for the service of a trigger notice. Accordingly, while it might seem a commercially unrealistic solution to many people, and not what the parties to the lease envisaged, the tenant's right to make time of the essence for the service of a trigger notice means that he need suffer very little delay beyond the time limit contemplated by clause 5.1(b)..
The question whether the letter constituted a valid counter-notice was to be determined by reference to the test laid down by Sir Nicolas Browne-Wilkinson, V-C in Nunes -v- Davies Laing & Dick Limited (1985) 51 P&CR 310 at 314: " namely that the counter-notice should be in terms which are sufficiently clear to bring home to the ordinary landlord that the tenant is purporting to exercise his right under the clause to challenge the landlords proposed rent.
    It appears to me that, applying the test set out above, the question is simply whether the letter informed the landlord that the tenant did not accept the annual amount [of rent] proposed by the landlord. (Neuberger LJ).
Applying Mannai the CA held (2-1) that the tenants letter was sufficient to operate as a counter-notice within the rent review clause.


Service of notice - address for service

Arundel Corporation v Khokher
[2003] EWCA Civ 1784

Facts

L served a rent review notice. T served a counter-notice. The lease required the counter-notice to be served at Ls last known place of abode or business. T sent the notice to the address stated in the lease as Ls registered office. However, L had moved and Ts solicitors were aware of this. They had been informed of that fact by Ls solicitors.

Held:

T was bound by the knowledge of its solicitors (applying Metropolitan Properties Co Ltd v Cordery [1980] 39 P&CR 10). The counter-notice was not therefore sent to the last known place of business and so was not validly served. T had to accept Ls proposed rent as stated in the rent review notice.

(Note: In relation to service of notices see further here)

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