Obi-Ezekpazu v Avon Ground Rents Ltd [2022] UKUT 121 (LC)

2006

The lease of 58 Trentham Court is granted to Ms Obi-Ezekpazu. Her address on lease is 3 Newquay House.

Clause 9 of the lease expressly incorporates regulations as to notices in section 196 LPA 1925

2010

Ms Obi-Ezekpazu moves to Hemans Street. She informs the managing agent, Crabtree.

2013   

The Management Company falls out with Crabtree – appoints Y&Y. Crabtree do not provide any documents to Y&Y. It does not provide Ms Obi-Ezekpazu’s Hemans Street address to Y&Y 

11 Sep 13

Avon Ground Rents Ltd acquires the freehold. Avon Estates appointed as managing agent. Avon Estates send ground rent demands to Newquay House, the original address on the lease.

2013

Later that year, Avon writes two letters to Ms Obi-Ezekpazu in connection with non-payment of ground rent, and claims administration charges of £420.

2014-19

The Management Company sends service charge demands to the original address on the lease, ie, Newquay House.

31 Jan 2019          

Demands start to be sent to Hemans Street                                                               

The question was whether the administration charges were payable by Ms Obi-Ezekpazu.

In order to answer it, Martin Rodger QC needed to establish whether the demands sent to Newquay House, the address on the lease, were validly served.

He prefaced his reasoning with four points:

• There is no statutory provision that requires that the purchaser of an interest in land should be taken to know things about the property simply because they were known to the seller;
• Section 196(3) of the LPA 1925 provides that any notice is sufficiently served if it is “left at the last-known place of abode of the lessee”;
• Section 196(4) deems service by registered post at that address to be good service provided the letter is not returned undelivered;
• In Oldham MBC v Tanna [2017] 1 WLR 1970 the Court of Appeal held that the notice had been validly served and that the address shown in the proprietorship register was the owner’s “last known place of abode” and therefore a permissible address for service under the Town & Country Planning Act 1990.

Martin Rodger QC quoted from Lewison LJ’s judgment:

“Lewison LJ explained that “a former address will only be the “last known” address if the server of the notice has taken reasonable steps to find out what the intended recipient’s current address is.  What he would have found out on making reasonable enquiries will be knowledge imputed to him…

“I would hold that as a general rule, unless there is a statutory requirement to the contrary, in a case in which

1. a person … wishes to serve notice relating to a particular property on the owner of that property, and
2. title to that property is registered at HM Land Registry, that person’s obligation to make reasonable inquiries goes no further than to search the proprietorship register to ascertain the address of the registered proprietor. It is the responsibility of the registered proprietor to keep his address up to date.

Turning to the appeal before him, Martin Rodger QC said that:

“In the absence of any evidence that the Landlord or its agent were aware that the Appellant home address in 2013 was Hemans Street, the landlord is therefore entitled to rely both on the registered title and on the recital of the Appellant’s address in the lease itself as justification for treating Newquay House as her last known place of abode”.

That was far from the end of the matter, because:

“Lewison LJ qualified his general rule that the address given for a person in the land register may be relied on as their place of abode with the important words “unless there is a statutory requirement to the contrary”.”

There were four issues to consider:

• Whether clause 9 of the lease, incorporating s.196, LPA 1925, constituted notice from the leaseholder;
• Whether it amounted to notice given to this landlord, who was not party to the lease when it was granted;
• Whether it is notification of an address, and
• Whether it is notice that the leaseholder wishes to receive s.166 notices at that address.

In order to succeed, the leaseholder needed Martin Rodger QC to answer “no” to just one of those questions. Conversely, the landlord needed all four questions to be determined in its favour.

This question was resolved in favour of the landlord:

“Where the section applies to a lease simply by virtue of its status as part of the general law, I would have difficulty in describing it as amounting to information given by the tenant. But section 196 is often incorporated expressly by reference. When it is, it can be said to be a positive act by the parties, and not simply a consequence of their contract imposed on them by operation of law, whether they had thought about it or not. On that basis the tenant can more readily be said, by executing the lease, to have communicated to the landlord that she is prepared to receive those notices to which section 196 applies at her last known place of abode.”

Martin Rodger QC was a little more ambivalent about this question:

“It is perhaps possible to regard a statement of the tenant’s address at the start of the lease as having been repeated to a new landlord each time the reversion changes hands, but the longer the lapse of time between the original statement and the change of reversioner the less likely the address will be to be accurate and the more artificial any such assumed notification would become.”

Question 3 required Martin Rodger QC to carry out an operation rather akin to comparing apples with pears:

“Section 166(6) makes the dwelling in respect of which the ground rent is payable the default address for service of a ground rent demand but allows the tenant to make a positive choice to receive notices at a different address. Section 196(3)-(4) serve a different purpose; they deem a notice to have been “sufficiently served” whether it comes to the attention of the tenant or not, provided it is left at or sent by registered post to the tenant’s last known place of abode. That place may not be the dwelling itself, and it may not be the tenant’s current place of abode or even one with which the tenant has any continuing connection. Section 196 was already part of the statutory framework regulating the relationship between landlords and tenants when the 2002 Act was enacted, and it is likely that Parliament intended section 166(6) to make some small, practical alteration in that relationship and to provide some additional protection or convenience for tenants. That alteration took the form of a positive right of nomination of an address which will displace any other assumed address. Section 196 identifies a different address as the default address for service and does not confer the same affirmative right of nominating an alternative address as section 166.”

Arriving at the last of the four issues, Martin Rodger QC reasoned that:

“…for a notification to be sufficient to displace the default requirement to serve ground rent demands at the dwelling itself, it must be notification of an address at which the tenant wishes to be given notices under section 166. Section 196(3) provides an address for service of notices “required or authorised by this Act to be served” i.e. by LPA 1925 (such as a section 146 notice). Unless a contrary intention appears, its scope is extended by section 196(5) to “notices required to be served by any instrument affecting property”. A ground rent demand under section 166 is given neither under LPA 1925 nor under an instrument affecting property (the lease) but is a specific statutory notice with its own statutory service requirements.”

Ms Obi-Ezekpazu’s appeal succeeded:

“In my judgment clause 9 of the lease is insufficient to amount to notification by the Appellant to the Landlord of an address other than 58 Trentham Court at which she wished to be sent ground rent demands. For that reason, as the Landlord is unable to prove that notice was in fact given to the Appellant, no ground rent was payable by her until demands began to be sent to her at Hemans Street in 2019 (as she had nominated that address). Because no ground rent was payable, the Appellant was not in breach of covenant in 2013 and there was no reason for the Landlord to take enforcement action against her. No administration charges are therefore payable by the Appellant in respect of costs incurred by the Landlord in seeking to recover ground rent in 2013.”