Breaches of covenant that are incapable of remedy: Rugby School (Governors) v Tannahill [1935] 1 KB 87

Section 58 of the Conveyancing and Property Ordinance (Hong Kong’s equivalent to LPA, s.146) requires notice to be served on a tenant before any action is taken to forfeit the lease. This notice must:

1. specify the breach complained of:

2. require the tenant to remedy the breach if it is capable of remedy; and

3.  specify the compensation (if any) that the landlord requires.

Despite the wording of s. 58, Rugby School (Governors) v Tannahill ([1935] 1 KB 87) is authority for the proposition that some breaches of covenant are incapable of remedy. In such cases, the s.58 notice need not require the tenant to remedy the breach.

In Rugby School the lease contained a covenant not to use the property for immoral purposes. The tenant, in breach of the covenant, had used the property as a brothel. The English Court of Appeal held that the breach was irremediable and so it did not matter that the landlord’s notice did not require the tenant to remedy the breach. The nature of the breach would adversely affect the property for a long time. The fact that the tenant had ceased her undesirable use of the property and promised not to repeat it did not remedy this long-term impact on the value of the landlord’s reversionary interest. CPO,  s.58 was intended to allow things to be put right within a reasonable period of time (per Maugham LJ at 93 – 94) but this breach would have long-term consequences.


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