Share it

Marguerite_Kenner_phBackground

The Respondent owner of Meadowview Mobile Home Park granted a licence to the Appellant, a Mr Telchadder, allowing him to station his mobile home on a pitch within the park. The licence agreement included both an express provision not to cause nuisance or annoyance to other park residents, and also an implied term under paragraph 4 of Chapter 2 of Part 1 of Schedule 1 to the Mobile Homes Act 1983, allowing the agreement to be terminated if the occupier had failed to comply with a notice to remedy any breach within a reasonable time. Mr Telchadder was described by the court as “somewhat eccentric” with a “mild learning disability” and “autistic traits”.

In August 2006, the Respondent sent Mr Telchadder a letter stating it had received complaints regarding his behaviour towards other resident of the park. Most notably, there was a complaint from Miss Puncher, a female resident of the Park, who claimed that Mr Telchadder had jumped out from behind a tree wearing camouflage clothing and camouflage netting over his head, startling her. The letter required Mr Telchadder to desist from such activities in the future and stated that, if he did not, an application to the court would be made to terminate his licence.

Mr Telchadder committed no further breach of the agreement until July 2009, when he threatened to kill several residents. The Respondent accordingly issued a claim for possession in the Southend County Court.

Appellate History

At first instance, HHJ Moloney QC found that the 2006 letter constituted a valid notice to remedy a breach under the Mobile Homes Act. Mr Telchadder argued that he had complied with the requirements of the 2006 notice not to commit any further breaches for “a reasonable time”, and that a fresh notice was required before issuing the 2009 proceedings. The County Court found against Mr Telchadder, holding that the requirements of paragraph 4 of the Mobile Homes Act had been satisfied. Mr Telchadder then brought an appeal.

The Court of Appeal dismissed Mr Telchadder’s appeal, finding that the 2006 notice to remedy was still effective for the purposes of the 2009 breach. The 2006 notice to remedy had a continuing effect for the whole of the claimant’s occupation in the park, and therefore the County Court’s order granting possession was upheld.

Supreme Court judgment

On 5 November 2014, the Supreme Court allowed Mr Telchadder’s appeal, reversing the Court of Appeal decision and holding that Mr Telchadder had met his obligation under the 2006 notice and that a fresh notice was required following the 2009 breach before possession proceedings could be initiated. The appeal was heard by Lady Hale, Lord Wilson, Lord Reed, Lord Carnwath and Lord Toulson.

The key issues before the Supreme Court were whether an occupier could remedy the breach of a negative obligation; if not, what impact did that have on the paragraph 4 requirement to provide notice; and in the alternative, how could one comply with a notice to remedy and what might constitute a reasonable time in which to do so.

Can an occupier remedy the breach of a negative obligation?

Case law regarding negative covenants has acknowledged that ceasing the prohibited behaviour may not always be sufficient remedy of breach. The Court analysed the case of Rugby School (Governors) v Tannahill [1925] 1 KB 87, which established the principal that lingering stigma and associated loss of value to the property may make a breach irremediable within a reasonable time, if at all.

But the Court here found an analogous effect between the Mr Telchadder’s behaviour and that of subsequent respondents where breaches with continuing effect were remedied when the effect stopped. Pointing to the paragraph 4 requirement to serve notice of the breach, the Court held that “it would be nonsensical to require service of a notice to remedy a breach which was incapable of remedy”.

How does an occupier comply with a notice to remedy a negative obligation?

The breach of the obligation not to engage in further anti-social behaviour was remedied by committing no further anti-social acts. Compliance ‘within a reasonable time’ should, in the context of a negative obligation, be read as ‘for a reasonable time’.

Dissenting from the majority (as to the reasoning but not the outcome), Lord Carnwath and Lord Reed felt that compliance with the notice to remedy must continue indefinitely, but that there needed to be a causal or temporal link between the notice to remedy and any subsequent breach.

The Court did find that some breaches could be so serious as to be irremediable, in which case an owner could commence immediate proceedings. In addition, Lord Reed, Lord Carnwath and Lord Toulson went a step further in obiter dicta, stating that repeated misconduct might also theoretically pass the point of being capable of remediation.

What constitutes a reasonable time in which to remedy?

Turning next to the question of what constituted a reasonable time within which to remedy the breach, the majority of the Supreme Court disagreed with the Court of Appeal’s position that the 2006 notice had a continuing and perpetual effect and that to equate the phrase ‘within a reasonable time’ with ‘throughout the subsistence of the agreement’ would effectively deprive the time limit of all meaning.

Although the Court failed to give any specific value to the length of a reasonable period of time, they agreed that the three year gap between the 2006 notice and the 2009 incident was sufficient  (the Court did not speculate as to whether a shorter period would have sufficed). Lady Hale characterised “a reasonable time” (in this context) as being such time as is sufficient for the fears and anxiety caused by the anti-social behaviour to calm down. The Court also held that, in the event of subsequent or persistent breaches, the period required to remedy any second or subsequent breach would be longer than the first.

Comments

In terms of wider applicability, the case provides clarity that a notice to remedy a breach does not last indefinitely. The judgment also provides a helpful discussion of when breaches of negative obligations are remediable, as well a useful analysis of the interpretation of “a reasonable time” in the context of a negative obligation.

Property managers faced with similar situations are advised to issue any notices to remedy breaches in a timely fashion, repeating them as often as is necessary, and to keep thorough records evidencing any breaches.