The intermediate tenant had charged the lease to the bank, which appointed receivers. Both the sub rent and the head rent fell into arrears. The head landlord then served a notice direct on the subtenant requiring him to pay the rent direct to the head landlord. The receiver then levied distress againt the sub tenant. The court held that the right to recover rent was a chose in action, which as a result of the appointment of the recivers assigned the right to receive the rent to the receivers. Because the head landlord knew of the appointment that assignment on the appointment took priority over the head landlord’s own notice (Dearle -v- Hall).
Held: The head landlord’s appeal succeeded. The bank had never gone into possession, and the intermediate tenant was therefore entitled to continue receiving the rents, and the head landlord was able to serve the notice. The appointment of receivers and crystallisation of the bank’s floating charge made no effective difference.
In the context of the mortgagor’s right to receive and retain the income of the mortgaged property without any liability to account to the mortgagor for it, the mortgagor remains in possession of the property ‘only by leave and licence of the mortgagee.’
Judges:
Nicholls LJ
Citations:
[1989] EG 70, [1989] 1 WLR 800
Statutes:
Law of Distress Amendment Act 1908 6
Jurisdiction:
England and Wales
Citing:
Cited – Dearle v Hall 1828
. .
Cited – Knill v Prowse 1884
An assignee of land may sue the tenant for the rent. . .
Cited – Gaskell v Gosling CA 28-Apr-1896
The agency of a receiver for the mortgagor is one where the principal, the mortgagor, has no say in the appointment or identity of the receiver and is not entitled to give any instructions to the receiver or to dismiss the receiver. ‘For valuable . .
Cited – Wallrock v Equity and Law Life Assurance Society 1942
. .
Cited – Ind, Coope and Co 1911
. .
Cited – Turner v Walsh CA 1909
The landlord sought to enforce the tenant’s repairing covenants. After the tenancy had been created, he had charged his interest. The tenant said that, since the lessor had conveyed his interest by way of mortgage, the right to sue lay exclusively . .
Cited – Gaskell v Gosling HL 1897
Affirmed . .
Cited – Challoner v Robinson 1908
A landlord entitled to distrain for rent, could seize all goods and chattels found on the tenant’s premises whether they were the property of the tenant or a stranger. . .
Mentioned – Ratford v Northavon District Council CA 1986
The reality of the agency of a receiver is reflected in the continuity, after the appointment of receivers, of the rateable occupation of the mortgagor through the agency of the receivers. The possession of an agent is to be attributed to that of . .
Cited by:
Cited – National Westminster Bank Plc v Ashe (Trustee In Bankruptcy of Djabar Babai) CA 8-Feb-2008
The mortgagees had made no payments under the charge for more than twelve years, and had remained in possession throughout. They argued that the bank were prevented from now seeking to enforce the charge. The bank argued that the possession had not . .
Lists of cited by and citing cases may be incomplete.
Land, Landlord and Tenant
Updated: 08 April 2022; Ref: scu.264292