Case E: Irremediable breach of tenancy
7.118 Case E permits the landlord to serve notice to quit where there has been an irremediable breach by the tenant of a term or condition of the tenancy that was not inconsistent with the fulfilment by the tenant of his obligation to farm in accordance with the rules of good husbandry.
The breach must also be one that causes material prejudice to the landlord’s interest, in the sense of serious prejudice to this reversionary interest in the land tenanted. The distinction between remediable and irremediable breaches of tenancy has already been discussed. Thus, for instance, Case E will apply where the tenant has assigned, sublet or parted with possession of the holding, without the landlord’s consent, in breach of covenant.259 Subletting will not necessarily cause material prejudice to the landlord’s interest, however, because the landlord will not (save by surrender of the head lease) be forced into a direct relationship with an undesirable subtenant. If the head tenant gives an upward notice to quit, the sub tenancy falls with the tenancy. Thus, in Pennell v Payne260 the landlord was unable to prove material prejudice where a sub tenancy had been granted to a limited company, having argued that he would thereby lose his right to possession on the tenant’s death. Query, however, material prejudice may be more easily established where there has been an assignment of the tenant’s interest, eg to a limited company.7.119 Case E will also apply where the tenant is in breach of some other obligation of a non-recurrent nature, eg failing to apply insurance moneys in reinstating the property within a reasonable period after damage by fire. The notice to quit must specify clearly that it is given under Case E, and must in particular make it clear that the breach complained of is irremediable, and not simply a remediable breach to which Case D will apply.
If it fails to do so it will be void for ambiguity. If the notice to quit contains statements which the landlord knows are false, or which are made recklessly as to whether they are true or false, it will be a nullity.261 The notice to quit will be a nullity at common law, even if the period for challenging the facts alleged by arbitration under the Arbitration Act 1996 has passed. Mere carelessness as to the reasons stated will not, however, invalidate the notice to quit.262 For these purposes a conservation covenant is not to be regarded as inconsistent with the tenant’s obligation to farm in accordance with the rules of good husbandry.2637.120 A novel attempt to use Case E as a vehicle to contract out of security of tenure altogether, and to deny the tenant the right to refer an ordinary, unqualified notice to quit to a tribunal for consent, was defeated in Johnson v Moreton.264 The landlord there inserted a clause in the lease whereby the tenant covenanted not to serve a counter-notice following notice to quit. If enforceable this covenant would have had the effect of denying the tenant the right to require the landlord to apply to the tribunal for consent to the operation of an unqualified notice to quit. When the landlord served notice to quit, the tenant nevertheless served a counter-notice, thus rendering the notice to quit ineffective without tribunal consent. The landlord then served a Case E notice to quit, claiming that the service of a counter-notice to his original notice to quit was an irremediable breach of tenancy, and materially prejudiced his interest. It was here held that the clause in the lease was void and unenforceable, being an attempt to contract out of the protective provisions of the Agricultural Holdings Acts.265 Security of tenure is granted by the 1986 Act as a matter of public interest, and not private right, and contracting-out (in whatever form) is not permissible.
It followed that the landlord could not rely on Case E, as there had been no breach of tenancy.7.121 Special provision is made for tenancies of smallholdings let by a smallholdings authority or the Minister. By virtue of Sch 3, para 11(1), when considering whether the interest of the landlord has been ‘materially prejudiced’ by the breach complained of, regard must be had not simply to the narrow consideration of the effect of the breach on the holding itself, but also to its wider effect on the carrying out by the landlord of his arrangements for the letting and conduct of smallholdings. If a breach, such as unauthorised subletting, has the effect of frustrating the objects of a smallholding scheme, this may weigh as ‘material prejudice’ even if the landlord’s reversionary interest has not been damaged in the narrower sense applicable in other cases.
7.122 Arbitration under Art 9 of the Arbitration on Notices Order 1987 is available following notice to quit, and is the only forum for questioning the reasons stated in the notice.
More on the topic Case E: Irremediable breach of tenancy:
- 5 Express Leasehold Covenants
- CASE 211: Motives and Reasons
- CASE 12: Incentives to Marry and Reproduce
- CASE 177: Privileged Heirs*
- CASE 27: An Affront to the Fiancée
- CASE 184: Subfecundity*
- CASE 173: Pupillary Substitution*
- 4 Procedure on Rent Review
- 2 Sub-tenancies of Agricultural land
- CASE 17: Marital Affection