Scottish & Newcastle Plc v Raguz [2007] EWCA Civ 150 (06 March 2007)

Scottish & Newcastle Plc v Raguz [2007] EWCA Civ 150 (06 March 2007)

Section 17 of the 1995 Act requires landlords to serve protective notices within six months of each rent day, even when a rent review is pending, to preserve the right to claim increased rent from the original tenant. Failure to do so precludes liability for those arrears. However, the indemnity under section 24 of the 1925 Act entitles the original tenant to recover from its assignee sums paid to the landlord as a result of the assignee's default, provided the payments were fairly and reasonably incurred, regardless of whether the original tenant was strictly legally liable or prompted the landlord to serve notices.

Citation
[2007] EWCA Civ 150
Parties
Claimant/respondent: Scottish & Newcastle plc; Defendant/appellant: Zeljko Stephen Raguz
Jurisdiction
England and Wales
Judgment Date
06 March 2007
Procedural Posture
Appeal (civil) / Court of Appeal Judgment on Appeal From High Court (chancery Division)
Outcome
Appeal dismissed; Respondent's Notice dismissed.
Legal Topics
Privity of Contract in Leases, Landlord and Tenant (covenants) Act 1995, Section 17 Notice Requirements, Indemnity Under Land Registration Act 1925 S.24, Rent Review Provisions, Assignment of Leases
Landlord and Tenant Property Law Contract Law Privity of Contract in Leases Landlord and Tenant (covenants) Act 1995 Section 17 Notice Requirements Indemnity Under Land Registration Act 1925 S.24 Rent Review Provisions +1 more

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Parties

Scottish & Newcastle plc

Claimant/respondent

Zeljko Stephen Raguz

Defendant/appellant

Procedural Posture

Appeal (civil) / Court of Appeal Judgment on Appeal From High Court (chancery Division)

Legal Issues

  1. 1 Whether section 17(2) of the Landlord and Tenant (Covenants) Act 1995 requires landlords to serve protective notices within six months of each rent day when a rent review is pending to preserve claims against the original tenant for increased rent determined retrospectively.
  2. 2 Whether the original tenant is entitled to an indemnity from its assignee under section 24(1)(b) of the Land Registration Act 1925 for sums paid to the landlord, even if not legally compellable to pay due to non-compliance with section 17 notice requirements.
  3. 3 Whether the claimant's entitlement to indemnity is affected by having prompted the landlord to serve section 17 notices.

Ratio Decidendi

Section 17 of the 1995 Act requires landlords to serve protective notices within six months of each rent day, even when a rent review is pending, to preserve the right to claim increased rent from the original tenant. Failure to do so precludes liability for those arrears. However, the indemnity under section 24 of the 1925 Act entitles the original tenant to recover from its assignee sums paid to the landlord as a result of the assignee's default, provided the payments were fairly and reasonably incurred, regardless of whether the original tenant was strictly legally liable or prompted the landlord to serve notices.

Court Disposition

Appeal dismissed; Respondent's Notice dismissed.

Orders

  • The appeal by the defendant is dismissed.
  • The Respondent's Notice is dismissed.