THE COURT

(Lord McGhie, Mr D J Houston)

THE TRUSTEES OF THE DRUMMOND TRUST v DAVID PETER BAIRD

(Application SLC 175/12 – Order of 19 August 2013)

AGRICULTURAL HOLDINGS – CONSENT TO NOTICE TO QUIT – CASE 6 – TWO MAN UNIT – ADEQUACY OF NOTICE – RISK OF CONFUSION – OBJECTIVE CONSTRUCTION – SPECIFICATION OF GROUNDS – ISH OF UNWRITTEN GRAZING LEASE – EXPENSES OF DEBATE – AGRICULTURAL HOLDINGS (SCOTLAND) ACT 1991 (AS AMENDED) SEC 25(2) AND SCHEDULE 2 CASE 6.

The landlords of a holding consisting of 22.53 ha of hill and pasture in Perthshire applied to the Court for an order for consent to a notice to quit. The notice purported to be given under “Case 6 of schedule 2 of the Agricultural Holdings (Scotland) Act 1991 (as amended) on the ground that the holding or any agricultural unit of which it forms part is not a viable unit”. At the relevant date the provisions of Case 6 had not been amended and the statutory ground then in force referred to a “two-man unit” rather than a “viable unit”. The tenant contended that the notice was invalid. The notice had been served against an ish of Martinmas and it was also contended that an ish at Whitsunday was to be presumed in the case of an unwritten lease which was founded on use for grazing. A question was also raised as to whether the application for consent had been timeously delivered to the Court.

HELD: (1) Although it was tolerably clear that the intention of the sender of the notice was to refer to the amended provisions the actual intention of the person giving the notice and the actual understanding of the recipient were both irrelevant. The question was whether the notice complied with the intention of Parliament as expressed in the legislation. The recipient had to be assumed to be aware of the relevant provisions. The reference to case 6 was sufficient to meet the statutory requirements and the other terms of the notice would not detract from that. (2) Although, in an unwritten lease of pasture there might be a presumption of a Whitsunday entry, the material provided was sufficient to justify acceptance of the Martinmas ish. Such presumptions might easily be displaced by evidence of the dates at which the stipulated rent was paid. (3) On the facts the Court could draw the inference that the application had been delivered timeously. (4) The landlords had successfully defended their right to rely on the notice and the tenant was liable in the expenses of and occasioned by the debate.

The Note appended to the Court’s order is as follows:

The landlords of a holding consisting of 22.53 ha of hill and pasture in Perthshire applied to the Court for an order for consent to a notice to quit. The notice purported to be given under “Case 6 of schedule 2 of the Agricultural Holdings (Scotland) Act 1991 (as amended) on the ground that the holding or any agricultural unit of which it forms part is not a viable unit”. At the relevant date the provisions of Case 6 had not been amended and the statutory ground then in force referred to a “two-man unit” rather than a “viable unit”. The tenant contended that the notice was invalid. The notice had been served against an ish of Martinmas and it was contended that an ish at Whitsunday was to be presumed in the case of an unwritten lease which was founded on use for grazing. A question was also raised as to whether the application for consent had been timeously delivered to the Court. We heard debate on 24 July 2013 when Mr Graeme Henderson, advocate, appeared on behalf of the landlords and Mr Lewis Kermack for the tenant.

Statutory material

Agricultural Holdings (Scotland) Act 1991 (“the Act”)
The Public Services Reform (Agricultural Holdings) (Scotland) Order 2011

Cases referred to

Aubrey Investments Ltd v DSC (Realisations) Ltd 2000 SLT 183
Barns Graham v Lamont 1971 SLT 341
Batt Cables Plc v Spencer Business Parks Ltd 2010 SLT 860
Budge v Hicks [1951] 2 KB 335
Jenners Princes St Edinburgh Ltd v Howe 1990 SLT (Land Ct) 26
Magdalen College, Oxford v Heritage [1974] 1 WLR 441
Mannai Investment Co Ltd v Eagle Star Life Assurance Co. Ltd.[1997] AC 749
Macnabb v Anderson and Ors 1957 SC 213
Morris and another v Muirhead, Buchanan & Macpherson and Ors. 1960 SLT 70
Mills and another v Edwards 1971 1 QB 379
Salvesen v Graham (SLC 242/04 Order of 18th March 2008)
Watters v Hunter 1927 SC 310

Text book authority

Gill The Law of Agricultural Holdings in Scotland 3rd Ed
Rankine on Leases 3rd Ed
Muir Watt and Moss Agricultural Holdings 14th Ed.

Background material

[1] Section 25(2) of the Act provides:

“(2) Notice to quit is duly given to a tenant to whom this section applies if –

(a) it complies with section 21 of this Act; and

(b) …

(c) where he was a near relative of the deceased tenant from whom he acquired right, it specifies the Case set out in Schedule 2 to this Act under which it is given…”

[2] It was not disputed that the tenant was a near relative of the deceased tenant and that the other statutory requirements were complied with. The questions raised under sec 25(2) related to the ish and the specification of the Case.

[3] The landlords’ Notice to Quit dated 15 November 2012 stated, in the second paragraph, that “This notice is given under Case 6 of Schedule 2 to the Agricultural Holdings (Scotland) Act 1991 (as amended) on the ground that the holding or any agricultural unit of which it forms part is not a viable unit and that the Landlord intends to use the holding for the purpose of effecting an amalgamation of the holding with the farm of Culticheldoch (shown delineated in red on the attached plan) within two years after the termination of the tenancy”. The notice was given under reference to an ish of Martinmas 2013.

[4] Reference to a “viable unit” was substituted for the previous test of a “two-man unit” in Schedule 2 of the 1991 Act, by Article 3 of the Public Services Reform (Agricultural Holdings) (Scotland) Order 2011. The Order came into force on 22 March 2011. However, in terms of Article 10(1) this was subject to article 10(2) which provides:

“(2) Where—

(a) notice to quit is given to a tenant of an agricultural holding who was a near relative of the deceased tenant from whom he or she acquired right to the lease of the holding; and

(b) the deceased tenant died prior to the day on which this Order comes into force,

section 25(3) of, and Schedule 2 to, the 1991 Act shall continue to have effect as if the amendments made by Article 3 had not been made.”

[5] The tenant’s predecessor died on 4 January 2011. It was said that the obvious explanation for the reference in the landlords’ notice to “a viable unit” rather than to the “two-man unit” test was that Article 10(2) of the 2011 Order had been overlooked by the landlords. Notice had been attempted under the amended provision rather than the provision as it stood at the relevant date. Although no express concession was made, the landlords did not attempt to dispute that explanation. Such an error is understandable in the complicated world of agricultural notices.

[6] “Two-man unit” was defined in Schedule 2 of the Act, before amendment, as follows:

“ ‘two-man unit’ means an agricultural unit which in the opinion of the Land Court is capable of providing full-time employment for an individual occupying it and at least one other man.”

[7] “Viable unit” was also a statutorily defined term in the Schedule as amended:

“ ‘viable unit’ means an agricultural unit which in the opinion of the Land Court is capable of providing an individual occupying it with full-time employment and the means to pay—

(a) the rent payable in respect of the unit; and

(b) for adequate maintenance of the unit.”

[8] In terms of section 23(1) an application by a landlord for the consent of the Land Court under section 22 of the Act to the operation of a notice to quit “shall be made within one month” after service on the landlord by the tenant of the appropriate counter-notice. The counter-notice dated 27 November was served on 28 November 2012. The landlords’ application to the Court for consent to the notice was date stamped as received by the Court on 31 December. However, it was intimated to Mr Kermack by e-mail of 21 December narrating that it had been submitted to the Land Court. Ms Barr had arranged for it to be sent to the Land Court through the Legal Post service. A representative of the Court collected mail from the Legal Post on 24 and on 27 December. Because of the holidays no mail was uplifted on 28 December. Ms Barr was on holiday throughout the period from 22 to 30 December.

Submission for tenant

[9] Mr Kermack produced a written submission with full quotation from the various authorities cited by him and detail of the statutory material in issue. We have found this very helpful. Although a copy of this material is available, we attempt to summarise it briefly.

[10] The notice to quit was said to be invalid on two grounds. The main submission was that the notice to quit failed to specify, in a valid manner, a Case set out in Schedule 2 as required by section 25(2)(c) of the Act. The second was that the notice to quit was not given in the form and manner prescribed by the Sheriff Courts (Scotland) Act 1907 in that it did not specify the correct ish. It was also submitted that the landlords’ application to the Court for consent to the operation of the notice to quit was not made within 1 month after service of the counter notice and did not comply with section 23(1) of the 1991 Act.

[11] Mr Kermack dealt with the various explanations or arguments advanced by the landlords in their pleadings. He accepted that the tenant could have had no complaint if the notice had merely referred to “Case 6” : Magdalen College v Heritage. However, by providing additional erroneous information, the landlords had set out grounds which were disconform to the requirements of the Case and this invalidated the notice.

[12] He referred to Gill, at 16.28, and discussed some of the cases there cited including Budge v Hicks, Macnabb v Anderson, Barns Graham v Lamont and Morris v Muirhead, Buchanan & Macpherson. His submission was that a notice which referred to a “viable unit” rather than a “two-man unit”, did not specify a Case under Schedule 2. The use of the phrase “viable unit” created uncertainty in the mind of the tenant who was likely to be confused by such a notice. The fact that the landlords relied on four different arguments in their pleadings as justifying the notice, only went to show its obscurity and ambiguity.

[13] The legislative purpose of section 25 was that the successor tenant should not only know that his landlord wanted him to go, but also the reason. The section set out a restricted set of circumstances, which the landlord had to prove to exist, if the tenant was to be compelled to go and the circumstances being relied upon must be specified in the notice.

[14] Although the amended statutory definition “viable unit” did not apply, by virtue of the savings provision, it was in existence and in force in certain circumstances at the date of service of the notice to quit. The tenant could be taken to be aware of this. Alternatively, “viable” had a dictionary definition. There was also the meaning proposed by the landlords’ pleadings: “By using the additional words “not viable” the notice meant that the Landlord was offering to prove that the holding was not viable as a two man unit.” Which definition was to apply on a particular date was not evident.

[15] It could not have been intended by Parliament that “viable unit” was to be interchangeable with “two-man unit”, as otherwise the amendment would have had no purpose. But the landlords’ position was dependent upon “viable” being read as “two-man”.

[16] A tenant in receipt of a notice to quit under section 25 had to decide whether to serve a counter notice. If he did so, then any tenant had to expect that his landlord would follow through and raise an application seeking consent. So, the tenant had to decide whether to risk litigation. This meant that a notice had to be clear.

[17] Mr Kermack examined dicta in Mannai Investment Co Ltd. Whatever the position in relation to contractual notices, the decision did not supplant Budge v Hicks in relation to statutory notices. Notices must not be obscure or ambiguous and had to be capable of being understood by the tenants. A notice under section 25(2) served a dual purpose, not only of telling the tenant that the landlord wanted rid of him, but also telling him the grounds which the landlord was offering to prove to bring that about. He also referred to the opinion of Lord Hodge in Batt Cables Plc v Spencer Business Parks Ltd. The reasonable recipient test could not be applied unless the notice was valid and to achieve validity it had to comply strictly with the statutory conditions. He referred to Salvesen v Graham para [40] and Muir Watt and Moss at paras 12.27 and 12.29.

[18] Submissions were also advanced under reference to the fair and reasonable landlord test in section 25(3). Reference was made to Aubrey Investments Ltd v DSC (Realisations) Ltd. Mr Kermack contended that the terms of the notice to quit were relevant to the test. While the fair and reasonable landlord was entitled to consider his own interests, he would also have an eye on the interests of the tenant. Such landlord would have taken care to ensure that the notice to quit was phrased as plainly as possible, so that it did not have the potential to mislead the tenant. In any event, if a fair and reasonable landlord realised that his notice to quit had proceeded on a basis which was erroneous, he would not wish to proceed on the basis of such a notice.

[19] In relation to the ish, Mr Kermack pointed out that there was no averment as to when or in what circumstances the tenancy came into existence. Under reference to Gill 16.20 and Rankine page 301 he submitted that where the value of the land to the tenant was for the grazing of stock, it would be unlikely that the tenant would start his lease in November. If the ish date stated in the notice to quit was incorrect, the notice to quit would not comply with section 21 of the 1991 Act.

Submissions for applicant

[20] Counsel started by referring to the question of the ish. He said he had not expected this to be challenged under the head of a plea to relevancy. We allowed him time to consider his position and, thereafter, he was able to provide a print-out of Drummond Estates’ financial records for the year to March 1996. This showed an invoice to “Baird, A” on 28 November 1995 of £565 said to be “annual”. He said that investigations had shown that the subjects had originally been grazed rent free along with the farm of Strageath Mill. At that time it had been changed to a yearly rent. It was clear that this was agreed to be on an annual basis to Martinmas. It did not matter whether the rent was forehand or backhand. This information showed clearly that the proper ish was Martinmas. There could be a proof on this if necessary.

[21] On the main issue of the validity of the notice, he referred to Gill 16.31. There was no need for the notice to tell the tenant how to respond. The issue was whether the notice made it clear that the landlord intended to prove that Case 6 applied. The reference to “a viable unit” did not cause any difficulty. Taken in context this was simply an easily understandable explanation of the two-man test.

[22] Counsel turned to the policy behind Case 6. Mr Kermack had suggested that it allowed a landlord to get rid of holdings which were too small. However it was clear that the underlying policy related to viability of a unit rather than size as such. The word “viable” was not to be interpreted in a technical way because the new provision was not in force. It was absurd to suggest that the tenant would interpret the notice on the basis of a statute which was not in force rather than on the statutory provisions as they stood. There was no significance in use of the expression “as amended” because the 1991 Act had been substantially amended in 2003. This expression meant no more than that the Act relied on was the Act as it stood at the date of the notice. This would be implied in any event.

[23] Mr Henderson made some reference to the tenant’s pleadings as tending to suggest that it was clear that the unit was neither a one-man or two-man unit. It plainly was not viable on any test. However, we understood him to agree that the validity of the notice was not to be assessed by the merits of the tenant’s position. He referred to the decision in Jenners v Howe as supporting the proposition that the underlying test was one of viability.

[24] An alternative contention was that even if the notice was to be interpreted by reference to the new statute this did not displace the fundamental meaning that the landlords intended to proceed under the current legislation. He referred to Gill 16.28 and the various authorities there cited. But these cases related to situations where there was a doubt as to which right a landlord or tenant was seeking to exercise when there were two provisions in force at the same time. That was not the case here. He referred to Mills v Edwards at pp 387-388. He submitted that if the notice had to be construed as referring to the new provisions, the effect of the decision in Mannai Investment Co Ltd was that the notice could be seen to be valid. It was clear that the landlords wanted to remove the tenant under the existing law. There was no valid distinction between statutory obligations and contractual obligations. The issues arising in relation to the validity of notices were the same. He referred to the discussion in Muir Watt and Moss. He discussed various passages from Mannai Investment Co Ltd. Even if there was an error in the notice the tenant could have had little doubt as to what was required of him.

Discussion

[25] For convenience we refer to the provisions of Case 6 as they stood prior to amendment as “the applicable provisions”. We refer to the changes effected by the 2011 order as the “amended provisions”. It was tolerably clear that the intention of the sender of the notice was to refer to the amended provisions and, indeed, this was the unmistakeable import of the language used by the landlords in the application as it initially stood. As these provisions were not in force, it might reasonably be said that the notice was in error. But the critical question here is whether this was a relevant error affecting the validity of the actual notice.

[26] None of the authorities cited bear directly on the problem of error as it arose in the present case. However, we are satisfied that the decision in Mannai Investment Co Ltd is sufficient authority for the need for an objective assessment. The actual intention of the person giving the notice and the actual understanding of the recipient are both irrelevant. This is clear from dicta in that case which is also authority for the proposition that the recipient is to be assumed to have an understanding of the relevant contractual context. We are satisfied that the same approach is to be taken where the relevant context is a statutory one.

[27] There are various dicta dealing with these points. Lord Steyn at p767 G comments, “The construction of the notices must be approached objectively”. That observation was made in reference to the recipient but a similar observation is to be found, at p772 E-F, under reference to the party giving notice – in that case, the tenant. Lord Hoffman expressed the same point, “But the law is not concerned with subjective intentions. All that matters is the objective meaning of the words he has used”: p775 B-C. Lord Clyde was to the same effect: “… in general the actual understanding of the parties is beside the point”: p782 D-E. The result of an objective approach is that the analysis is necessarily artificial. Where the notice contains an error, the fact that the tenant may guess at what the landlord meant or even be certain what the landlord meant does not affect the matter: see Lord Hoffman p774 B-C. Where on an objective construction the notice itself is free from error, the fact that the party giving notice was labouring under some error is to be ignored.

[28] In a contractual context, the question is whether, properly construed, the notice complies with the intentions of parties as expressed in the contract. In the statutory context, the question of compliance turns on the intention of Parliament as expressed in the legislation. It does not turn on the actual intentions of the party giving notice. When considering the terms of the notice the recipient is to be assumed to be aware of the relevant contractual provisions. Lord Steyn at p 768 B-C said, “It follows that one cannot ignore that a reasonable recipient of the notices would have had in the forefront of his mind the terms of the leases.” There is no reason why the same principle should not apply to the applicable provisions of an Act of Parliament. Lord Steyn cited a dictum of Lord Greene M.R. which referred to the “familiarity with the provisions of the Act which a recipient of such a document must be presumed to have”: p771 G

[29] It follows from the above that the mere fact that the notice was, or might well have been, intended by the landlords to be one based on the amended provisions is irrelevant. As Mr Henderson submitted, the validity of the notice must be assessed by reference to the law applicable to it. In other words, the proper starting point for analysis is not an assumption that it was given under the wrong provisions. The starting point is to look at the actual terms of the notice in light of the applicable provisions; that is, the law as it stood at the relevant date.

[30] If the amended provisions – which admittedly do not apply – had never existed, there would, as it seems to us, be no ground for any challenge of the notice. This follows from the provisions of section 25(2)(c) which only require identification of the Case founded on. Mr Kermack expressly conceded that if the letter of 15 November 2012 had omitted the words “on the ground that the holding or any agricultural unit of which it forms part is not a viable unit and that” it would not have been challengeable. We do not think that concession could have been withheld. But if the notice could validly have been given with a bald reference to “Case 6”, any additional words could not affect its validity unless they had the effect of detracting, in some material way, from the specification of that Case as the ground relied on, in terms of the notice, for the purposes of section 25.

[31] We are entirely satisfied that, absent the amended provisions, the reference to viability could not be said to detract in any way from identification of Case 6 as the relevant provision for the purposes of section 25. A person considering the notice in light of the applicable law could have no reason to think that the landlords were proposing some test other than the two-man test set out in the schedule. We entirely accept Mr Henderson’s contention that a reference to viability would have been taken as a shorthand way of referring to the two-man test. It was described in such terms in the Jenners case: p 29. Mr Kermack made reference to a primary dictionary definition of “viable” as “having a chance of success”. This meaning would be the one the reader would have in mind when considering the notice. It was not inconsistent with the two-man test.

[32] In short, the significant feature of this case, which contrasts with the relevant authorities cited, is that the notice which was given was, prima facie, valid. More specifically, it was valid in accordance with the applicable provisions, the law as it stood had there been no amendment. When the problem is addressed in this way, it becomes clear that the first issue is not one of an error to be excused but whether the provisions of legislation, which did not apply to the notice, can properly be said to be capable of rendering it invalid. The critical questions in this case are whether the amended provisions have any relevance and, if so, whether, in light of these provisions, the use of the term “viable” detracted significantly from the explicit reference to Case 6.

[33] Although it might seem surprising to find that legislation which was not in force could nevertheless have the effect of rendering a notice invalid, we have little difficulty in accepting that there could be circumstances in which it might have such an effect. The very existence of potentially confusing material is relevant. The question is whether the prima facie clarity of the notice has been fatally affected by extraneous language used.

[34] In Mannai Investment Co Ltd, Batt Cables and the various other cases on the subject of error in notices cited to us, the issue was whether the recipient could be misled in the context of an error of some sort in the notice. As it was put in Mannai Investment Co Ltd, the real question was, “What errors can be overlooked?: p770D. But in Salvesen v Graham we dealt with a broader question. We said, at para [40], “A notice might comply fully with the statutory requirements without being entirely clear. We accept that we cannot impose an entirely separate test of clarity but if there are real issues of ambiguity this may well cast doubt on whether statutory requirements have properly been complied with.” If a notice which can be seen to contain the information required by the statutory material also contains other contradictory information, the statutory requirement might not be complied with. We accept Mr Kermack’s contention that if the notice was likely to cause serious confusion in a tenant as to the case being relied on, it would not comply with the provisions of section 25. If a notice requires to contain certain information to comply with a specific statutory requirement, it may not be sufficient to say that it is possible to construe the notice as containing that information. It will, at least, be necessary to say that, on a fair reading, the hypothetical recipient would be able to identify the essential information.

[35] To take an extreme example, it might not be possible to say that a notice specified “Case 6” if it simply made bald reference to “Case 6 and Case 7”. There would be no sufficient specification of a Case if the recipient had no way of determining which one was being referred to. We accept that, even if it is possible to read a notice as giving sufficient information to comply with the statutory requirements, the notice will not be valid if it is couched in such a way as to leave the recipient in some real doubt about the matters required by the statute. However, if there was other material in the notice, the effect of such material might be to show that the reference to Case 7 cast no real doubt on the specification of Case 6 as the Case which was being founded on. In other words, we are entirely satisfied that there can be circumstances where, on a proper construction, a reference to Case 6 can be accepted as properly specified for the purposes of section 25(1)(c) even where potentially conflicting material has been provided. This will always be a question of circumstances.

[36] A dominant circumstance will be that the tenant must be taken to read the notice in light of the appropriate legislation. Even if he was aware that the word “viable” was to be understood in a different sense for the purposes of the new legislation, there would be no reason for a hypothetical tenant to apply that meaning. The notice referred to Case 6. That, necessarily, must be taken to be Case 6 of the applicable provisions. That was the ground upon which the landlords had given notice to quit: the route down which they said they were to go. That was the ground which the tenant had to evaluate in considering his own position. The reference to viability was capable of being read as a shorthand for the two-man test. It might possibly have given rise to a suspicion that the landlords had misunderstood what they would have to do to establish the ground upon which they relied. But this would not change the statutory ground in respect of which notice had been explicitly given.

[37] This is not a case where two statutory provisions might have applied and the notice could be read as leaving the tenant in doubt as to which was intended. In this case there could be no doubt that only one provision was applicable. The hypothetical tenant had to construe the notice in terms of that provision. We are satisfied that considering the notice in this way, the reference to viability did not detract in any significant way from the clear identification of the Case relied on. The challenge to validity of the notice fails.

[38] It may be added that we do not think that the inclusion of the words “as amended” has any bearing on the matter. It may well be that they, in fact, derived from the landlords’ actual intention to refer to the amended provisions but this is irrelevant to an objective view of the notice. There is no doubt that the Act had been extensively amended by the 2003 Act and it would not be unusual for a lawyer to make reference to the “Act as amended” even where the specific provisions being relied on had not been amended.

[39] We are also satisfied that in the circumstances of the present case it is unnecessary to embark on any close examination of the purpose of the notice. In broad terms the purpose of a notice to quit may be thought self-evident. The purpose of a notice is not the same as the purpose of legislation which allows it to be given. We think it unnecessary and unhelpful to speculate about notices in other terms. Mr Kermack questioned what would have been said if the amended provisions had been in force at the relevant date and the notice had made express reference to the “two-man test”. That would have been an example of an error patent to the recipient and it would, no doubt, have required careful attention to the dicta in Mannai Investment Co Ltd and Batt Cables. However, as we have explained, the present case is not properly to be viewed as one of error in the notice. No purpose is to be served by our expressing a view on such a notice.

[40] We turn to the other matters discussed: namely, the ish, the date of the landlords’ application to the Court for consent, and some aspects of the test of a fair and reasonable landlord.

[41] Notice was given against an ish at Martinmas. The tenant contended that in an unwritten lease of pasture there was a presumption of a Whitsunday entry. It was submitted that the landlords’ averments were insufficient to support a contrary ish and accordingly that the pleadings were irrelevant. However, we are satisfied that the material provided is sufficient to justify acceptance of the Martinmas ish. The landlords averred that in the early years of the lease rent had been paid in one instalment at Martinmas. Mr Henderson amplified matters by referring, without objection, to a print-out showing the invoicing of annual rent in 1995 on 28 November. He was able to say that the history of the holding was that rent free occupation of the land had been converted by agreement to a paid lease running from year to year from Martinmas. We are satisfied that the presumptions relied on have no bearing in that situation where the lease arrangement started with an agreement to pay annual rent at Martinmas. In any event such presumptions “might easily be displaced by evidence of the dates at which the stipulated rent was paid”: per Lord President Clyde in Watters v Hunter p316.

[42] In absence of any challenge to the facts by the new tenant, who might understandably have no direct knowledge of earlier events, we were tempted to make a positive determination excluding further challenge in relation to the ish. If there is no contrary evidence little will be needed to satisfy us that the November ish is correct. But we had understood Mr Henderson to accept that this was a matter for proof and we have decided that it is safer to let it be dealt with in that way. However, it would seem that there may be no disputed issue of fact to be determined and, if so, it would save possible waste of time and expense if the tenant now formally withdrew the challenge on this head.

[43] The problem over the date of the application to the Court for consent arose from the fact that it was stamped as having been received on 31 December. This was out of time. Mr Kermack expressly accepted that if we were satisfied that the notice was in the hands of the Legal Post for collection by the Court on 28 December it would have to be accepted as timeous. It is sufficient to say that we are so satisfied. On balance of probabilities the available evidence supports a finding that it was in their hands by that date. We do not doubt the assertion by Ms Barr that the notice was sent off on 21 December. An email was sent to Mr Kermack on that date advising that it had been submitted. Ms Barr was on holiday thereafter. Although we have no explanation as to how it came about that it was not collected by the Court uplifts on 24 and 27 December, there was no uplift on Friday 28 December. It was in the hands of the Court on the Monday and as no question of later posting by Ms Barr arises, we have little doubt that the notice must have been in the hands of the Legal Post for collection at least by the end of the preceding week.

[44] Mr Kermack made certain submissions relating to the position of a fair and reasonable landlord. It is plain that the main argument on this head will require a proof. We think there is no merit in the submission that a landlord who realised that he had sent an inaccurate notice would have decided, in fairness, not to enforce it even if a court decided that it was valid. We think that this is quite fanciful. The error was a technical one. It did not, in any way, bear upon the substance of what the landlord was trying to do. The tenant was not prejudiced by the error. A fair and reasonable landlord who intended to give a notice to quit is entitled to rely on the conclusion of the Court that the notice was valid.

Decision

[45] For the reasons set out above, we are satisfied that the tenant’s challenges fail. Mr Henderson submitted that it would, in that event, be appropriate to clarify the pleadings by deleting the tenant’s averments in explanation of his plea to relevancy. We have considered this suggestion. However, our notes were not entirely clear as to what material was proposed to be excised and rather than have further formal procedure to identify the precise averments which might come out, we have decided that the simplest course is to make an order specifying the matters which are to go to probation. If parties are in any doubt about this, we would be prepared to hear further submissions as to the most appropriate way to proceed. As noted above, we hope that it will be possible to resolve the question of the ish by agreement.

[46] Although it has been the practice of the Court to defer questions of expenses to be dealt with by way of written submissions in light of the detailed decision, this can cause unnecessary expenditure. Many of the applications before us do raise mixed issues and it is often simpler to invite written submissions after the decision is issued. However, it is preferable to try to deal with expenses as soon as possible and to defer only when there is an identified reason to do so. In the present case we heard submissions at the end of the debate. Mr Henderson moved for certification of the debate as suitable for the employment of junior counsel and we have no doubt that this is justified. He submitted that expenses should follow success. Mr Kermack submitted that if the tenant lost it would not be appropriate simply to apply a rule of expenses following success. This rule was based on the principle that liability for expenses should lie on the person who caused the litigation. The main debate arose from landlords’ error in relying on the wrong provisions.

[47] We are satisfied that in the context of the dispute as a whole the issues discussed at debate are properly to be seen as a separate chapter in the development of the case. We find no reason to depart from the normal rule that expenses should follow success. It is rare that the Court can take account of the merits of what happened before the litigation. Parties require to consider their positions at the stage before the expense of litigation is incurred. A person who is put to the expense of litigation to maintain or defend a right against challenge is entitled to recover the expense caused by the challenge. The landlords have successfully defended their right to rely on the notice of 15 November 2012. We find the tenant liable in the expenses of and occasioned by the debate.