Case Law on – Surrender

landlord legal advice on caseA surrender is a voluntary agreement by both landlord and tenant that a tenancy should come to an end. A surrender should be by deed, although an oral agreement to surrender may be effective as a surrender by operation of law.

House of Lords Barrett v Morgan [2000] 2 AC 2 4; [2000] 2 WLR 284; [2000] All ER 48 ; [2000] EGLR 8; (2000)
Times 28 January

Arrangement concerning NTQ not tantamount to consensual surrender of tenancy Freeholders of agricultural land agreed with their tenants that they would serve a notice to quit and that the tenants would not serve a counter notice under Agricultural Holdings Act 1986. The purpose of this agreement was to enable the freeholders to obtain possession against a subtenant. The
Court of Appeal held that this arrangement was tantamount to a consensual surrender of the tenancy and so did not determine the subtenancy. The House of Lords allowed a further appeal. Service of a notice to quit by either a tenant or a landlord by pre-arrangement with the other was not tantamount to a surrender of the tenancy as, unlike a surrender, it did not need the consent of the receiving party to have effect. In this case, the tenants’ consent was unnecessary and the freeholders were only doing with their consent what they were entitled to do without it.

Court of Appeal N4.2 Basingstoke and Deane BC v Paice ( 99 ) 27 HLR 4 ; [ 99 ] 2 EGLR 9, CA

Unlawful subtenant became council’s tenant on surrender of lease The council granted a 15-year fixed-term lease of commercial garage premises to Mr L’Heureux. Without the council’s knowledge or consent, he converted part of the garage offices into a self-contained flat and let it to Mr Paice. The council then accepted a surrender of the lease. The Court of Appeal allowed Mr Paice’s appeal against a possession order and substituted a declaration that he was the council’s tenant and, since all the conditions of Housing Act 1985 ss79 to 81 were satisfied, that he was a secure tenant.

Belcourt Estates Ltd v Adesina [200 ] EWCA Ci 208; 8 February 200

Surrender by operation of law requires unequivocal conduct by parties consistent with termination of tenancy such that inequitable for parties to dispute termination In August 2000 Belcourt Estates let three dilapidated houses with what had been shops or businesses on the ground floor to Ms Adesina. She did not pay any rent because she decided that she did not want the premises
and left in November 2000. She did not inform Belcourt of this. Belcourt did not take any action until the local authority sought payment of business rates. As a result, in January 2002 it issued proceedings against Ms Adesina. A judge found that Belcourt had not exercised its right to re-enter the premises, and that it had done nothing to collect the rent until January 2002. He held that that conduct amounted to evidence that the tenancy no longer existed and that it had been surrendered in November 2000. Accordingly no rent was due. Belcourt appealed. The Court of Appeal allowed the appeal. Surrender of a lease by operation of law requires that the conduct of the parties has to amount unequivocally to acceptance that the tenancy has ended. There must either
be relinquishment of possession and its acceptance by the landlord or other conduct consistent only with the cesser of the tenancy and the circumstances must be such as to render it inequitable for the tenant to dispute that the tenancy has ceased or such as to render it inequitable for the landlord to dispute that the tenancy has ceased. Mere inaction, or acts of omission, cannot be unequivocal conduct. In this case, although Belcourt had failed to act in taking possession or pursuing payments of rent, that conduct had not unequivocally amounted to acceptance that the
tenancy had ended. Belcourt was entitled to the arrears of rent claimed.

Bolnore Properties Ltd v Cobb ( 997) 29 HLR 202; ( 99 ) 7 P&CR 27, CA

Tenant vacating flat for 24 hours and handing over keys operated as surrender The landlord brought possession proceedings against a statutory tenant, relying on arrears of rent. After the tenant had failed to comply with a suspended possession order, the landlord issued a warrant. In or about 1987, execution of the warrant was suspended on terms that the tenant would pay all arrears and agree to substitute a protected shorthold tenancy. In order to avoid the effect of Housing Act 1980 s52(2) (which prevented the creation of a protected shorthold tenancy if the tenancy was ‘granted to a person who, immediately before it was granted, was a protected or statutory tenant of that dwelling-house’) and as part of the agreement, the tenant agreed to vacate the flat for 24 hours and to hand over the keys. At first instance, the judge decided that the previous tenancy had determined. Delivery of the keys was indicative of the tenant’s intention to bring the tenancy to an end. The Court of Appeal dismissed the tenant’s appeal. A Rent Act tenancy can be brought to an end by the creation of a new tenancy which is inconsistent with the old one. It is a question of fact and degree whether the

Surrender  – Termination of tenancies at common law grantee of a new tenancy is a protected or statutory tenant immediately before its grant. There is no rule of law ‘precluding a 24-hour period’ out of occupation. It was impossible to state that the parties’ actions were a device to avoid the impact of the Rent Act.

Bone v Bone [ 992] EGCS 8 , CA

Licence not terminated merely by licensees moving out The defendants (the parents) owned an early 19th-century farmhouse where they lived with their son (the plaintiff). They also owned a coach house and four acres of grounds. The parents sold the house to the son in 1985 for £35,000, but continued to live there as licensees. The judge found that the sale was at an undervalue and that the continuing provision of living accommodation for the parents was an important part of the consideration. A year later the parents moved out. Claiming that they had abandoned
their licence, the son put the house on the market for £350,000. The parents registered land charges to protect their rights of occupation and, as a result, the son sought a declaration that they had abandoned their licence. Before the hearing, the son exchanged contracts for the sale of the house for £450,000. In the High Court, it was held that the parents had not abandoned their licence and they were awarded damages of £70,000. On appeal, it was held that, although no formalities were required for the abandonment of a contractual licence, it had not been reasonable for the son to assume that, merely by moving out, the parents had abandoned their licence. Therefore, the parents’ licence had not been determined. The Court of Appeal took into account the fact that the parents had refused to sign a deed of surrender which had been prepared by the son. The damages award was upheld.

Brent LBC v Sharma and Vyas( 99 ) 2 HLR 2 7, CA

Tenant’s letter regarding transfer of tenancy operated as surrender Mr Sharma was granted a tenancy in 1984. Later Ms Vyas came to live with him. In 1987 Mr Sharma moved out and surrendered his tenancy. The council then granted a tenancy to Ms Vyas. Mr Sharma apparently moved back into the premises with his two children. Ms Vyas wrote saying that she had no objection to the tenancy being transferred into his name. There were rent arrears of about £4,000. The council did not transfer the tenancy and did not treat Mr Sharma as a tenant. They no longer debited any rent to the account of Ms Vyas. They delivered a notice to quit addressed to Ms Vyas at the property, but it was clear that it never came to her attention and so was ineffective. HHJ Rowntree found that the letter was an unequivocal act showing that Ms Vyas wished to surrender the tenancy and that this had been accepted by the council. The Court of Appeal dismissed Mr Sharma’s appeal. It was plain by the time that proceedings were issued that the council accepted by its conduct that the tenancy no longer existed. There was a surrender by operation of
law. Stuart-Smith LJ cited with approval the following passage in Woodfall vol 1 p822, para 1-1849: The term ‘surrender by operation of law’ or ‘implied surrender’ (there being no distinction) is the expression used to describe all those cases where the law implies a surrender from unequivocal conduct of both parties which is inconsistent with the continuance of the existing tenancy.

Camden LBC v Alexandrou ( 998) 0 HLR 4, CA

Surrender by operation of law where tenant sought to assign interest to other tenant Mr Alexandrou was a secure tenant. He wrote to the council stating, ‘The above flat is no longer my responsibility as I am unable to pay for the upkeep. My wife wishes to keep the said flat and pay the rent to which I agree.’ The council treated the tenancy as having been assigned to the wife. She later gave notice to quit and the council took proceedings for possession against Mr Alexandrou on the basis that he no longer had an interest in the property. The trial judge granted possession, holding that the notice had been validly given by the wife as the sole tenant and had determined her tenancy. He further held that she had either obtained the tenancy from her husband by assignment or following a surrender by him. Mr Alexandrou sought leave to appeal on the grounds that (a) there was no assignment because there was no deed (see Crago v Julian [1992] 1 WLR 372, CA) and (b) no case for surrender had been pleaded or made out by evidence.

The Court of Appeal was satisfied that, notwithstanding the absence of a deed of either surrender or assignment, a surrender by operation of law had been made out on the evidence even though the tenant had not given vacant possession at the date of his letter or thereafter. Accordingly, the court refused an application for leave to appeal.

Chamberlain v Scalley ( 994) 2 HLR 2 , CA

Surrender not to be implied by absence unless long absence with large arrears The defendant was a joint tenant with a Miss Butler. In 1990 Miss Butler moved out, but left her belongings and two cats behind. The landlord argued that this was unequivocal evidence that there had been an implied surrender by operation of law. A county court judge made an order for possession and Mr Scalley appealed. The Court of Appeal held that, for there to be an implied surrender, there had to be unequivocal conduct on the part of both the landlord and the tenant which was inconsistent with the continuance of a tenancy. A surrender was not to be implied unless there had been a long absence with large arrears of rent. The tenant’s conduct was equivocal because she had left her belongings and cats behind and so there had been no surrender. The possession order was set aside.

Climping Park Ltd v Barritt ( 989) Independent May, CA

Where parties enter into new agreement old agreement surrendered When an existing tenancy between the same parties is replaced by a new agreement which operates as a surrender of the old tenancy by the Surrender Termination of tenancies at common law tenant and a re-grant by the landlord, the latter is good consideration for the surrender by the tenant and all new obligations which the tenant takes on.

Ealing Housing Association v McKenzie [200 ] EWCA Ci 02; [2004] HLR 2 ; [2004] L&TR ; (200 ) Times 0 October

Where ineffective NTQ served by departing tenant who was rehoused by landlord there was an implied surrender Ealing Housing Association let a flat to Mrs McKenzie on an assured tenancy. In February 2000 she moved out, leaving her husband, Mr McKenzie, who enjoyed matrimonial home rights under Family Law Act 1996 s30, in occupation. She informed Ealing that she did not intend to return because of domestic violence and applied for a transfer to a new property. She was offered alternative accommodation on condition that she terminated her existing tenancy of the flat. On 11 July 2000 she signed a notice to quit. Ealing later accepted that it was invalid because it gave insufficient notice. Ealing brought possession proceedings, claiming that Mr McKenzie was a trespasser. HHJ Oppenheimer held that there had been an implied surrender and made a possession order. The Court of Appeal dismissed Mr McKenzie’s appeal. There was no express surrender because there was nothing in writing within the meaning of Law of Property (Miscellaneous Provisions) Act 1989 s2. There was no implied surrender by operation of law simply as a result of Mrs McKenzie moving out without an intention to return because the flat was still occupied by Mr McKenzie pursuant to Family Law Act 1996 s30. However, there was evidence that from 17 July 2000 Ealing had transferred Mrs McKenzie’s rent account to the new flat and ceased to charge her rent for the old flat. There was an unequivocal inference that Ealing accepted that the tenancy had been terminated. The notice to quit was an act by the tenant manifesting an intention to terminate the tenancy immediately. From 17 July 2000 both sides conducted themselves
on the basis that the tenancy was terminated. Accordingly the judge was entitled to find that there had been an implied surrender of the tenancy.

Foster v Robinson [ 9 ] KB 49; [ 9 0] 2 All ER 42, CA

Agreement that retired farm worker need no longer pay rent operated as surrender;son estopped from claiming tenancy still existed  A cottage was occupied by a farm worker who paid a yearly rent of £6 10s (£6.50). When, as a result of age and infirmity, he stopped working, his landlord and former employer agreed that he need not pay any further rent but could live in the cottage for the rest of his life. The Court of Appeal held that this agreement was an effective surrender by operation of law and that the former tenant’s son was estopped from claiming that the old tenancy still existed. The Court of Appeal approved the following passage in Foa’s General Law of Landlord and Tenant: It has been laid down that in order to constitute a surrender by operation of law there must be, first, an act of purported surrender invalid per se by reason of non-compliance with statutory or other formalities, and secondly, some change of circumstances supervening on, or arising from, the purported surrender, which, by reason of the doctrine of estoppel or part performance, makes it inequitable and fraudulent for any of the parties to rely upon the invalidity of the purported surrender.

Hackney LBC v Snowden [200 ] L&TR 0, (200 ) HLR 4, CA (see F4.9)

Open to landlord and tenant to agree to treat NTQ as valid and thereby waive the requirement of four weeks’ notice

Laine v Cadwallader (200 ) HLR 97, [200 ] L&TR 77, CA

Return of keys an offer of surrender, not a surrender The claimant granted the defendants an assured shorthold tenancy for a term of six months from 19 January 1998. The tenants held over at the end of the fixed term and became statutory periodic tenants. On 10 September 1998 they left and put the keys through the landlord’s letter box. The landlord sued, among other things, for four weeks’ rent in lieu of notice. Her claim was dismissed in the county court, but allowed in the Court of Appeal. Under Protection from Eviction Act 1977 s5 any notice to quit by a tenant is invalid unless it is given not less than four weeks before the date on which it is due to take effect. The dropping off of the keys was not a surrender, but an offer to surrender. There was no express acceptance of the offer. The landlord had agreed to terminate the tenancy at the end of the minimum period for which a proper notice could have been given. The landlord was accordingly entitled to recover the rent for that four-week period.

Leek and Moorlands Building Society v Clark [ 9 2] 2 QB 788; [ 9 2] 2 All ER 492, CA

One of two joint tenants cannot surrender a joint tenancy Unless there is express agreement, one of two joint tenants cannot validly surrender a joint tenancy.

Mattey Securities Ltd v Ervin [ 998] 4 EG 9 , CA

Payment of rent by non-tenant did not amount to surrender and re-grant to payer In a case involving commercial premises, the court considered the circumstances in which a surrender by operation of law may occur. Bracewell J said: The conduct of the parties must unequivocally amount to an acceptance that the tenancy is ended for the doctrine to apply. Although a surrender by
operation of law does not require that there is an intention of the parties to surrender the lease, it does however require that there is some unequivocal act which has the effect of estopping the parties from asserting that the lease is still extant.

Surrender    Termination of tenancies at common law Payment of rent by a company other than the tenant which had entered into occupation did not operate as a surrender by operation of law and regrant to the company which was paying the rent.

Preston BC v Fairclough ( 98 ) 8 HLR 70, CA

For landlord to establish surrender; tenant leaving premises owing rent insufficient The tenants of a council house allowed Mrs Fairclough to move in with them. Later the tenants left, leaving Mrs Fairclough in occupation. The council, without taking any steps to terminate the tenants’ tenancy (such as serving a notice to quit), brought possession proceedings under County Court Rules Ord 24. A county court judge held that the tenancy had been terminated by operation of law and made a possession order. Mrs Fairclough’s appeal was allowed. Griffiths LJ stated: … it is for the Council to establish on such an application that they are entitled to possession of the premises. As they have taken no steps to determine the tenancy of [the tenants], they would only be able to establish that they were entitled to possession of the premises if there was material from which the learned judge could draw the inference that there had been a surrender by law of the tenancy. It is for the Council to establish a surrender by law. They have placed virtually no material before the judge which would entitle him to draw such an inference. The bare fact that a
tenant leaves premises at a time when he owes rent is certainly insufficient to enable a court to draw the inference that there has been a surrender.

Proudreed Ltd v Microgen Holdings plc [ 99 ] EGLR 89; [ 99 ] 2 EG 27, CA

No surrender by return of keys Although the return of keys by a tenant to a landlord may amount to a surrender, this is not so if there is no other evidence that the landlord intends to resume possession. In this case, the landlord held the keys for six days before returning them to the tenant’s receiver. The Court of Appeal held that on these particular facts there had been no surrender.

R v Croydon LBC ex p Toth ( 988) 20 HLR 7 , CA (see T 2.2)

Tenancy surrendered where tenant left premises taking all belongings; facts at time landlord accepted surrender relevant; later assertion by tenant that did not intend to leave permanently irrelevant

Sanctuary Housing Association v Baker ( 998) 0 HLR 809; [ 998] EGLR 42; [ 998] 09 EG 0, CA (see E . )

Assignment effective despite consent to assign having been obtained by fraud; fraud nullified consent; no implied surrender

Sanctuary Housing Association v Campbell [ 999] WLR 279; [ 999] All ER 4 0; (2000) 2 HLR 00; [ 999] 8 EG 2; ( 999)
Times April, CA

Where tenant left premises and rehoused herself actions unequivocal; MHA did not restrict tenant’s rights to terminate tenancy The plaintiff housing association granted Ms Shaw a secure weekly
tenancy of a dwelling. She occupied the house with her children and her co-habitee, Mr Campbell. Later she married Mr Campbell, but then left the house as a result of domestic violence and purported to surrender possession. However, Mr Campbell remained in the house and refused to leave. The housing association began proceedings to gain possession of the house. In his defence, Mr Campbell relied on rights conferred on him by Matrimonial Homes Act 1983. An assistant recorder decided that the tenancy had been expressly surrendered. Mr Campbell appealed unsuccessfully. On appeal it was conceded that any surrender could only have been by operation of law. The Court of Appeal held that there had been a surrender by operation of law. After
rehousing herself, Ms Shaw had done all that she could to comply with the housing association’s stipulation that she should vacate the premises and return the keys. Her conduct was unequivocal. The court distinguished Hoggett v Hoggett (1980) 39 P&CR 121, CA. Furthermore, there is nothing in Matrimonial Homes Act 1983 s1 which restricts a tenant’s right to terminate her contractual relationship with the landlord. Nothing in s1 gave Mr Campbell indefinite rights of occupation of the former matrimonial home which were only terminable by an order under s1(2)(a) or otherwise
within the court’s jurisdiction derived from the suit. The section was plainly intended to regulate the rights of spouses between themselves.

Zionmor v Islington LBC ( 998) 0 HLR 822; March 998 Legal Action 0, CA

Tenant leaving note to other tenants that he was leaving did not amount to offer of surrender to landlord In 1992 the council let the plaintiff a flat on a secure tenancy. In October 1995, the tenant gave notice of the right to buy. This was admitted by the council. Before completion the tenant left the flat, leaving behind a friend. When he left, he put up a notice in the common parts indicating
that because graffiti had been written on the walls of his flat, his windows smashed and his door locks broken, he would no longer be residing at the property. Later he explained that the note was intended to make those who had been harassing him think that he had left the property for good. The council was informed of the note by other tenants and the council’s caretaker could not find the tenant. The council decided that the flat had been abandoned and changed the locks to the front door. The tenant sought orders readmitting him to the property and restraining the landlord’s
further interference with it. The council claimed that the departure of the tenant amounted to a surrender and thereby determination of the tenancy. The county court judge rejected the council’s defence and held that the tenancy had not been determined. The council’s appeal was dismissed by the Court of Appeal. The court held that the county court judge had properly directed himself that the question was whether the acts of the tenant amounted to an implied offer of surrender of the tenancy. If the acts could not amount to such an implied Termination of tenancies at common law offer of surrender, then there was no offer for the landlords to accept. The Court of Appeal agreed with the judge that, as the tenant had left a friend in possession together with at least some of his belongings, no inference could properly be drawn that he had intended to give up the tenancy. The council could not place reliance on the notice affixed to the notice-board because it was not directed to the landlord and did not suggest that the tenant was giving up possession in any legal or technical sense so as to surrender the tenancy. There had been no unequivocal relinquishment of possession and no implied offer of surrender.

High Court Barakat v Ealing LBC [ 99 ] COD 02, QBD

Return of keys and landlord’s acceptance with intention of taking possession a surrender In a case involving liability for non-domestic rates, Brooke J held that a surrender by operation of law occurs where one party does and the other assents to an act which is inconsistent with the continuance of the lease or tenancy. The tenant’s return of the keys and the landlord’s acceptance
of them with the intention of taking possession was sufficient to effect a surrender. There are four preconditions to surrender by operation of law:

1) the doing of an act by a party;
2) that the act is inconsistent with the continuation of the tenancy;
3) the assent of the other party; and
4) the intention of the landlord to take possession and accept the termination of the tenancy.

Coker v London Rent Assessment Panel [200 ] EWHC 2 7 (Admin); 9 May 200

Variation to terms of tenancy did not amount to surrender of tenancy and re-grant Mr Coker was the tenant of a flat. For many years there were substantial disputes between him and his landlord. In October 2004 these were settled by a Tomlin order which had the effect of varying the rent, rendering insurance rent non-payable, modifying the covenant against alterations and changing the contract from a business tenancy to an assured tenancy. The rent payable was £950 per month. Later the landlord served a notice of increase of rent under Housing Act 1988 s13. Mr Coker referred the notice to the rent assessment panel (RAP), arguing that it was invalid because the Tomlin order amounted to the surrender of the old tenancy and grant of a new tenancy. The RAP rejected that argument on the basis that the amendments created by the order could not amount to a new tenancy as they were not sufficiently substantial. The RAP inspected the flat and concluded that £1,120 per month was the rent for which the flat could reasonably be expected to be let on the open market in accordance with s14. Mr Coker appealed against that decision. James Goudie QC, sitting as a deputy High Court judge, dismissed the appeal. The Tomlin order had not resulted in any increase in the premises demised or in the length of term. The absence of both features did not mean that there could never be a surrender, but that there would only exceptionally be one. At the date of the Tomlin order, it was common ground that Mr Coker had an assured tenancy and not a business tenancy. The only variations to the tenancy agreement (ie, agreement by the landlord not to enforce the insurance rent and a modification to the covenant against alterations) ‘came nowhere near, individually or cumulatively, to being sufficient to imply a surrender and re-grant’.

R v Hammersmith and Fulham LBC ex p Quigley (2000) 2 HLR 79; ( 999) Independent 24 May, QBD (see L .9)

Council’s decision to bring possession claim quashed. No implied surrender

County courts Hackney LBC v Ampratum 7 April 200 , Central London Civil Trial Centre

Not possible to infer surrender where tenant left unwillingly (due to deportation) Ms Bonney-Offei, the second defendant, was a secure tenant. She was deported to Ghana in 1993. In 1994 the council agreed to the assignment of the tenancy to the first defendant. However, that assignment was invalid because the written consent of Ms Bonney-Offei was not obtained. In 2000 Ms Bonney-Offei returned from Ghana and went back into occupation of the premises. The council began possession proceedings, claiming that Ms Bonney-Offei’s tenancy had been surrendered by operation of law and that the first defendant had unlawfully sublet. Bell J, sitting as a judge of the county court, dismissed the claim. There was nothing in the circumstances to justify the inference that there had been a surrender. Ms Bonney-Offei had left unwillingly and could be expected to return, if able, in due course. She had left her family in occupation. It was not possible to infer surrender from her deportation. Her actions did not amount to an unequivocal acceptance that the tenancy had ended.

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