Facts

The landlord was a limited company which granted the tenants an assured shorthold tenancy of a house in July 2014. The tenants paid a deposit at the outset which was protected under a deposit protection scheme. A deposit certificate was served on the tenants that was signed by a director of the landlord company.

By March 2017, the tenants had fallen into rent arrears and the landlord served a s.8 notice pursuant to Grounds 8, 10 and 11 of Schedule 2 HA 1988. The s.8 notice was in the correct form and set out all the required information. It was signed by a property manager employed by the landlord.

The tenants subsequently sought to defend the possession proceedings on the basis that the s.8 notice was invalid as the landlord had failed to authenticate it in the manner prescribed by s.44 of the Companies Act 2006 (“s.44 CA 2006”). The tenants also brought a counterclaim for a penalty award under s.214(4) HA 2004 on the basis that the deposit certificate required a signature by the landlord. In short, s. 44 CA 2006, requires two authorised signatories or a director to sign in the presence of a witness when a company executes a document.

Decision at first instance

The Recorder held that s.44 CA 2006 did not apply to a s.8 notice but did apply to the deposit certificate. Accordingly, the Recorder made an order for possession and awarded the tenants a sum by way of a penalty for breach of s.214 HA 2004 with such sums to be set off against the rent arrears.

The tenants appealed the Recorder’s findings in relation to the s.8 notice and the landlord cross-appealed against the finding in connection with the deposit certificate.

Appeal in the High Court

Saini J dismissed the tenants’ appeal on the s.8 notice and also dismissed the landlord’s cross-appeal. He held that the deposit certificate was invalid unless signed in the manner required by s.44 CA 2006 but that the s.8 notice was valid although it had only been signed by the landlord’s agent.

The tenants appealed against the finding on the s.8 notice and the landlord cross-appealed on the finding on the deposit certificate.

Decision of the Court of Appeal

Lewison LJ gave the leading judgment. As to the validity of the deposit certificate, it was noted that the 2007 Order (as it then stood) merely required the certificate under paragraph to “be signed by the landlord”. The “landlord” had at that time the meaning given to it by s.212(9) HA 2004; it included a person acting on behalf of the landlord in relation to the tenancy. Accordingly, the certificate was valid as it was signed by a director of the company [46].

It was noted that the Deregulation Act 2015 retrospectively disapplied s.212(9) HA 2004. However, Article 2 (3) (a) of the Housing (Tenancy Deposits) (Prescribed Information) Order 2007 allowed the “the landlord” to be read as including a person who acts on the landlord’s behalf. In the present case, the certificate was given in the name of the landlord but it was signed by a director. It was held as the director was self-evidently not personally the landlord, the only rational conclusion is that she was a person acting on behalf of the landlord [52]. Accordingly, the certificate was and remained valid.

Even if that was wrong, s.213(6) HA 2004 permitted the giving of the information in a form substantially to the same effect. In this case, the certificate gave the tenants all of the required information and was signed by a person authorised (both by the landlord and by section 212(9)) to sign it. Lewison LJ, therefore, considered that it was substantially to the same effect and accordingly was valid [55].

In arriving at this conclusion, Lewison LJ did not consider that the reason in Hilmi & Associates Ltd v 20 Pembridge Villas Freehold Ltd [2010] EWCA Civ 314 was directly applicable to the requirement of the deposit certificate to be “signed by” the landlord [22-31].

As to the s.8 notice, it was noted that the primary legislation governing notice under s.8 HA 1988 did not require a signature, merely “service” by the landlord of a notice in a particular form. It followed from Newbold v Coal Authority [2013] EWCA Civ 584that a landlord complies with s.8 HA 1988 if an agent serves notice on his behalf, even if the agent signs the notice in the landlord’s name. In addition, the form prescribed by the relevant regulations explicitly allowed notice to be given by and signed by an agent for the landlord[57].

In the present case, the notice under section 8 was signed by an authorised agent of the landlord. That complied both with the primary legislation and the prescribed form. The only possible error was that the agent had crossed out the wording “landlord’s agent”. Lewison LJ however did not think that it could have been Parliament’s intention that such an immaterial error would invalidate the notice and accordingly held that even if the s.8 notice failed to comply strictly with the statutory requirements, it was still valid[69].

Accordingly, the tenant’s appeal was dismissed and the landlord’s cross-appeal was allowed.

Summary by Henry Percy-Raine, barrister, Trinity Chambers.

For the judgment, click here.