Opposing a section 26 LTA 1954 Notice

This article was first published in Lexis PSL Property.

When a landlord is serving counter-notice on a tenant following a LTA 1954, section 26 notice, is it detrimental for the Landlord to list several sections of section 30(1), eg (e), (f) and (g), in their opposition?

Opposing a section 26 notice

The Landlord and Tenant Act 1954, s26(6) (LTA 1954) provides that a landlord may serve a notice on the tenant that he will oppose an application to the court for the grant of a new tenancy, stating which grounds of opposition are being relied upon. The grounds set out in the LTA 1954, s30(1) are explained in Halsbury’s Laws of England, Grounds of opposition; in general.

By s30(1)(e), a landlord may oppose an application for a new tenancy or may make an application for the termination of a tenancy without the grant of new tenancy where the current tenancy was created by the subletting of part only of the property and the landlord can obtain more rent by letting the whole of the property.

The s30(1)(f) ground of opposition is that on the termination of the current tenancy he intends to demolish or reconstruct the premises comprised in the holding or a substantial part of those premises, or to carry out substantial work of construction on the holding or part of it, and that he could not reasonably do so without obtaining possession of the holding.

The s30(1)(g) ground of opposition is that on the termination of the current tenancy he intends to occupy the holding for the purposes, or partly for the purposes, of a business. The landlord must intend to occupy the same premises as existed during the occupation by the tenant; and, if the landlord's intention is to demolish those premises and to reconstruct new premises and occupy them, he should rely upon s30(1)(f).

Statutory compensation

When considering how many grounds to include, it is worth remembering that LTA 1954, s37 provides amongst other things that a tenant shall be entitled to compensation where he is refused a new tenancy on grounds LTA 1954, ss30(1)(e), (f) or (g).

Time of intention

The landlord will be required to prove its case at the date of the hearing: Betty's Cafés Ltd v Phillips Furnishing Stores Ltd.

In that case, the House of Lords also suggested that the relevant state of affairs must have existed at the date of the giving of the landlord’s notice as well as the date of the hearing. Lord Denning stated at page 50 that the landlord must honestly and truthfully state his ground in his notice and establish it as existing at the time of the hearing: 'I am of opinion that they must be given honestly and truthfully. They are not to be regarded merely as pleadings preparatory to a trial—in which parties, I regret to say, sometimes deny the truth, or refuse to admit it, if it suits their plan of campaign. These notices are intended to be acted upon before there is a trial at all'.

In Hough v Greathall Ltd, another case concerned with LTA 1954, s30(1)(f), the Court of Appeal held that a landlord is not required to have in place at the date of the notice all the elements that would enable him to prove his intention at such time. The key date at which he must prove his intention is the date of the hearing. The landlord is not required to also prove that he had the requisite intention at the date of serving the notice.

Conclusions

It may nevertheless prove detrimental to a landlord, in terms of costs, if he includes grounds upon which he does not intend to rely or which are inconsistent. The inclusion of additional and unnecessary grounds will force a tenant to prepare a case to meet those objections. In addition, the landlord needs to bear in mind that some of the grounds will entitle the tenant to statutory compensation.

If however, several grounds are applicable, then such a landlord, would be wise to include them. There is no power to amend the grounds of opposition in the notice and there is a risk that a new tenancy will be granted if the landlord only relies on one ground and the landlord’s opposition on that ground fails: Nursey and Another v P Currie (Dartford) Ltd . A landlord would be wise to rely on LTA 1954, ss1(f) and 1(g) in the alternative if he intends to occupy the premises and the premises require some renovation. Thus, if the courts consider that the renovation works are extensive then, he may succeed on ground 1(f), but if not, then he may succeed on ground 1(g).