Cheering news for tenants and a reminder to landlords to comply fully with statute and get notices right when forfeiting a residential lease 

A landlord purported to forfeit a residential tenant’s long lease of a flat for non-payment of rent, by peaceable re-entry. However, as the landlord had failed to comply with sections 166 and 167 of the Commonhold and Leasehold Reform Act 2002, the Upper Tribunal held that the forfeiture was invalid.

A tenant with a long residential lease is only liable to pay rent if it is demanded by a section 166 notice, which must be in a prescribed form and accompanied by notes in accordance with the Landlord and Tenant (Notice of Rent) (England) Regulations 2004 (which explain the effect of section 167). In this case the landlord used an old version of the notes. While the meaning of the new notes, which were published in 2011, is the same as the old version, the new notes are clearer for a tenant to understand. The fact the old wording was used rendered the s166 notice invalid.

The Upper Tribunal also clarified when time starts to run for the purposes of forfeiture.

In this case the lease allowed the landlord to forfeit if the rent was more than 2 years in arrears. The Tribunal considered whether the 2 years starts to run from the payment date in the s166 demand or from the date the sums were due under the lease. It held that 2 years runs from the payment date in the s166 notice.

Section 167 of the Commonhold and Leasehold Reform Act 2002 confers additional protection on tenants as it provides there can be no forfeiture unless the rent arrears exceed £350 or an amount of rent has been outstanding for more than 3 years. The Tribunal considered when 3 years runs from and decided it was also from the payment date in the section 166 notice, not the due date under the lease.

Therefore the landlord was not entitled to forfeit until 3 years from the date payment date in the s166 notice.

Comment

This case is another reminder of how careful landlords need to be when seeking to forfeit a residential lease, and ensure that they comply with the terms of the lease and relevant statutes to avoid a delay in obtaining possession.

Cheerupmate2 Ltd v Calce [2017] UKUT 377 (TCC).