Is your notice understandable by a reasonable recipient, even if you made mistakes? This is the “reasonable recipient test”.
When serving a notice under a lease or letting agreement, such as a section 8 or section 21, rent review notice or break notice, care must be taken to ensure any requirements noted in the lease agreement or provisions in the relevant legislation are fully complied with, and that the serving of and wording of the notice are correct.
This is particularly important where the notice must be in prescribed form under statutory legislation. A mistake in serving the notice, or an error in its wording, could render any notice invalid. Where this is the case the notice would not stand up in court and the applicant would have his case thrown out on a technicality, wasting valuable time and adding costs.
Fortunately for landlords and their legal representatives, several appeal court decisions have ameliorated the situation with notices, in that sometimes, in particular circumstances, mistakes can be tolerated providing the meaning of the notice and the intention of the server can be easily ascertained and understood as such by a “reasonable recipient”.
The “reasonable recipient” Test
When determining the validity of notices, a distinction should be drawn between requirements in the lease agreement which specify:
1 – Fundamental requirements in the lease agreement or in legislation which must be met if the notice is to be valid, and
2 – Any other requirements in the lease or legislation which deal generally with the imparting of information to another party, but which do not stipulate that this is an indispensable or fundamental requirement for a notice to be valid.
Any notice which fails to meet the indispensable or fundamental requirement specified in the lease or relevant legislation, falling into the first category (1), the notice will be invalid.
Where a relevant requirement or provision falls into the second category (2), a defect may possibly be cured by applying the “reasonable recipient” test.
The Reasonable Recipient Test
This test of reasonableness was established in the House of Lords case of Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd  AC 749.
In this case the court interpreted and determined the validity of a notice by asking how a reasonable recipient would have understood it, bearing in mind its context.
Where a reasonable recipient, with knowledge of the terms of the lease, would be left in no doubt about what was meant by the notice, despite the notice having an error or errors in it, then it would be valid.
In this case the error in the notice was not a failure to meet a fundamental requirement in the lease. Had this been the case, then with such an error, the reasonable recipient test could not be applied.
The reasonable recipient test will not be met if there is scope for confusion in a reasonable recipient.
The notice must communicate the required message clearly and unambiguously, and the reasonable recipient must be left in no doubt whatsoever.
This illustrates the importance of carefully checking the terms of the lease when serving a notice, and making sure that the requirements of the relevant statutory provisions if any are met, and the wording of the notice is correct. If there is an error in the fundamentals, the “reasonable recipient” test may not cure it.
The “reasonable recipient” test was applied in the Court of Appeal case of Patel and others v MRD Property Developments Ltd over the argument of a valid demand for insurance rent.
The Court of Appeal case highlighted what constitutes a valid demand for insurance contributions from a landlord to a tenant.
In this case the landlord provided one of the tenants with copies of the insurer’s renewal notices, by way of a demand for the tenants to pay the insurance and renew the policy. The tenant’s argument was that this did not constitute a valid demand for payment of insurance rent. The lease agreement had set out that insurance rent would become due 14 days after demanded.
It was held that it was reasonable for the landlord to think and the tenant to assume that handing over copies of paperwork from the insurers did constitute a request for payment of the insurance rent, and that copies of renewal notices given to just one of the tenants did amount to a valid demand.
The court looked back to Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd  AC 749 which concluded that words in notices should be interpreted in the way a reasonable commercial person would interpret them.
It is recommended that landlords always issue proper rent demands and notices which comply fully with the requirements of the lease and any statutory provisions.Although the Mannai decision is helpful to landlords who may fail to do so, you should not rely on this “safety net”.
Cases Applicable to S21 Notices
Because of confusion over tenancy periods and end dates it has been common for s21 possession claims to be thrown out of court on a technicality.
However, in Lower Street Properties v. Jones (1996) the Court of Appeal said a notice with a saving clause but no actual expiry date would be valid (a ‘no date’ notice).
The saving clause is intended to inform the tenant of the landlord’s intention should he get the end of tenancy period wrong. An example of this clause is:
‘after (insert date……………….) or, if later, the day on which a complete period of your tenancy expires next after the end of two months from the service of this notice’.
Some judges have been uncomfortable with this saving clause or have not been aware of the Lower Street Properties Appeal case. However, the position has been clarified in Appeal Court judgements in Elias v. Spencer (2010) and Spencer v. Taylor (2013).
Elias v. Spencer and Spencer v. Taylor have since clarified the situation were both an end date and a saving clause are included in the notice; in that the saving clause always takes precedent over the end date, should this be wrong.
In view of the rulings in these three Appeal Court cases it is recommended that all section 21 notices include a “saving clause”, and landlords or their representatives should be prepared to point these out to judges if they are unsure.
By Tom Entwistle, LandlordZONE®
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©LandlordZONE All Rights Reserved – never rely totally on these general guidelines which apply primarily to England and Wales. They are not definitive statements of the law. Before taking action or not, always do your own research and/or seek professional advice with the full facts of your case and all documents to hand.