In 1975 the tenant sought to exercise his right to purchase the freehold reversion of his property. The landlord argued that the rent payable precluded any such entitlement. Under the law as then understood, the landlord’s contention appeared correct. The leaseholder proceeded no further. In 1980 the law was clarified so as to indicate that he was so entitled, and in 1981 he sought to proceed with his claim. The landlord’s contention that he had abandoned it failed at first instance.
Held: The tenant’s appeal failed. Oliver LJ: ‘As regards abandonment [the judge] held – and in my judgment he was clearly right in this – that in order to succeed the trustees had to show either some reliance and change of position amounting to an estoppel (of which there was no suggestion) or what amounted in effect to a contract for mutual release. Quite clearly there was no question of an express contract and what he had, therefore, to look for was whether there was material from which mutual promises could be implied. On the facts, he found himself unable to find any mutual release but, perhaps even more importantly, he held that the Act of 1967 and the regulations provided, as it were, a complete statutory code which regulated exclusively how the statutory contract of sale was to be either completed or discharged and that there was no room for the application of the common law concept of inferred abandonment by mutual consent.
With respect to the judge, I doubt whether this latter conclusion can be right. . . As he rightly pointed out there is, in the law of contract, no room for a concept of unilateral abandonment. What the court has to look for is . . . material from which there can be inferred mutual releases or mutual promises not to proceed. In other words . . there has to be established, if only by inference, a fresh contract which has the effect of dissolving the relationship originally entered into by the parties and upon which one party still seeks to rely. Now tenants who are entitled to enfranchise under the Act of 1967 are not permitted to contract out of their entitlement, but there is nothing in the Act which prevents them, once their right of enfranchisement has accrued, from releasing contractually the immediate right of enfranchisement which they have acquired by serving a notice under the Act.’ The court agreed with the judge’s alternative conclusion that on the facts of the case there was no material from which mutual releases could be inferred.
The essence of a specialty is a covenant under seal or an obligation imposed by statute.
Judges:
Oliver LJ, May LJ and Sir Roger Ormrod
Citations:
[1985] 1 QB 581
Statutes:
Leasehold Reform Act 1967, Limitation Act 1980
Jurisdiction:
England and Wales
Cited by:
Cited – Martin v Medina Housing Association Ltd CA 31-Mar-2006
The former tenant had set out to buy the council house, but had written to say that she did not intend to go ahead. Her son who had taken over the tenancy after her death now sought, twelve years later, to require the authority to proceed at that . .
Cited – Hill (As Trustee In Bankruptcy of Nurkowski) v Spread Trustee Company Ltd and Another CA 12-May-2006
The defendants sought relief for transactions entered into at an undervalue. The bankrupt had entered into charges and an assignment of a loan account in their favour before his bankruptcy, and the trustee had obtained an order for them to be set . .
Cited – Nolan v Wright ChD 26-Feb-2009
The defendant sought to re-open the question of whether the charge under which he might otherwise be liable was an extortionate credit bargain. The creditor said that that plea was time barred. The defendant argued that a finding that the agreement . .
Lists of cited by and citing cases may be incomplete.
Landlord and Tenant, Contract, Limitation
Updated: 11 June 2022; Ref: scu.242431