Scottish and Newcastle Plc v Raguz: CA 6 Mar 2007

The claimant was the original tenant under two 99 year underleases granted in 1967, and assigned them to the defendant who then himself assigned them. The eventual assignee had become insolvent. The landlord recovered the rents from the claimant who now sought an indemnity from the defendant under the 1925 Act. To minimise the losses, the claimant had assisted the receiver in looking for new tenants. The defendant said a precondition of the claim was that the landlord should have served a notice under section 17(2) of the 1995 Act. The difficulty was as to whether the notice should refer to the unreviewed rent. The tenant argued that the increased element of the rent could only become due once fixed and due.
Held: The tenant’s argument would not leave any scope for section 17(4) of the Act to operate, and ‘Nor do I see why, as a matter of policy, the legislation should have provided for advance warning by way of the two-stage process under the two sub-sections in a case where the unreviewed rent is in arrear, but not when that amount is up to date.’ The Act made no distinction between an original or current rent and a review increase: ‘if a landlord wishes to preserve the possibility of claiming against an original tenant when the rent is subject to review, he must serve section 17(2) notices within 6 months after each rent day in turn, specifying in the Schedule that the sum intended to be recovered is then nil, but subject to paragraph 4 of the notice and the possibility of the rent being determined to be a greater sum. ‘ Since the landlord had not served the notices in this way, the tenant was not entitled to a full indemnity from his assignee for the payments he had made.

Mummery LJ, Rix LJ, Lloyd LJ
[2007] EWCA Civ 150, [2007] 2 All ER 871
Bailii, Gazette
Landlord and Tenant (Covenants) Act 1995, Land Registration Act 1925 24(1)(b)
England and Wales
See AlsoScottish and Newcastle Plc v Raguz CA 24-Jul-2003
Leases had been granted. They had been assigned to the defendant who had assigned them again. The last assignee became insolvent and statutory demands were served on the claimant under the 1995 Act for rent. The claimant paid the sums due and now . .
See AlsoScottish and Newcastle Plc v Raguz ChD 27-Jul-2004
The claimant had previously assigned its interest in a lease to the defendant, who had in turn re-assigned it. The eventual tenant became insolvent, and the landlord had recovered sums from the claimant who now sought an indemnity under the covenant . .
Appeal fromScottish and Newcastle Plc v Raguz ChD 11-Apr-2006
The defendant had taken assignments of the term of two underleases from the claimant, and then re-assigned them to a limited company with guarantors of the rent, and they in turn re-assigned the leases. The last company became insolvent. The . .
CitedCH Bailey Ltd v Memorial Enterprises Ltd CA 1974
The court considered the construction of a rent review clause in a lease. Lord Denning MR said: ‘So I think these rent review clauses are to be construed according to their natural meaning. The clause in the present case says that the increased . .
CitedUnited Scientific Holdings v Burnley Borough Council HL 1978
The House was asked whether a failure by a lessor to keep strictly to the timetable laid down in a rent review clause in a lease necessarily deprived the lessor of the benefit of the rent review.
Held: A stipulation as to time in an option . .
CitedAlexander v Vane 1836
The Plaintiff had given an oral guarantee to P that the Defendant would pay for certain goods ordered by him from P: if the Defendant did not pay P for the goods, he (the Plaintiff) would do so. The Defendant did not pay the full amount due and the . .
MentionedSleigh v Sleigh 1850
The court considered a claim for an indemnity under a bill of exchange which was said to be unenforceable. . .
CitedSmith v Howell 1851
A lease had been granted to G, who assigned the term to the Plaintiff, who later assigned on to the Defendant. The assignees each covenanted to perform the obligations under the lease, and to indemnify the assignor. Rent not being duly paid, and the . .
CitedSouth Tottenham Land Securities Ltd v R and A Millett (Shops) Ltd CA 1984
The court considered on what date the increased rent determined by a rent review fell due for payment.
Held: O’Connor LJ refused the appeal: ‘If the parties choose to put into a lease that rent is due on quarter days, then there are good . .
CitedRe Chetwynd’s Estate CA 1938
A liability arose on a joint and several promissory note, where it was clear that one of the two parties (C) was the principal debtor and the other (S) was, as between them, in the position of a guarantor. The note did not comply with the 1927 Act. . .
CitedMoule v Garrett CA 3-Feb-1872
An original tenant sought an indemnity from an assignee for a later claim by the landlord.
Held: The principles of recoupment are that where a plaintiff has been compelled by law to pay, or, being compellable by law, has paid, money which the . .

Cited by:
Appeal fromScottish and Newcastle Plc v Raguz HL 29-Oct-2008
The lease had been assigned by the claimant to the defendant and on again to a tenant who became insolvent. The landlord had recovered sums said to be due from the claimant who now sought an indemnity from the defendant. The defendant said that the . .

Lists of cited by and citing cases may be incomplete.

Landlord and Tenant

Leading Case

Updated: 10 December 2021; Ref: scu.249864