Obligations to repair and reinstate on the expiry of the term: written notice needed?

In L Batley Pet Products Ltd v North Lanarkshire Council ([2014] UKSC 27) L was the intermediate landlord and T was sub-tenant. The head-lease and sub-lease contained full repairing covenants and the terms of the head lease were incorporated in the sub-lease. Both leases required all notices to be in writing. L and T had entered into a Minute of Agreement authorising T to make alterations. The Minute required T to reinstate the property at the end of the term at the request of L and did not expressly require such notice to be in writing. The Minute stated that its terms should be deemed to be incorporated into the sub-lease.

L argued that oral notice that it required the alterations to be removed and the property to be reinstated at the end of the term was sufficient. T argued that it had no obligation to deal with dilapidations (breaches of the repairing covenant) nor to remove the alterations and reinstate the property because it had not received written notice before the end of the term.

Lord Hodge (with whom the rest of the Supreme Court agreed) dealt first with the dilapidations point. A repairing covenant in the form used here ‘imposes a continuing obligation on the tenant which does not require any notice for the landlord to activate it.’ ([14])

L should also be allowed to proceed with its claim concerning the removal / reinstatement. It was a question of the construction of the Minute of Agreement and he referred to the accepted approach to contractual interpretation ([18] – [19]). Looking at the clause in question in the context of the document as a whole and of the factual matrix he preferred the straightforward approach to the construction of the clause which did not expressly require notice to be in writing.

Michael Lower

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