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You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> Balgray Ltd v Hodgson [2016] ScotCS CSIH_55 (15 July 2016) URL: http://www.bailii.org/scot/cases/ScotCS/2016/[2016]CSIH55.html Cite as: [2016] ScotCS CSIH_55 |
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EXTRA DIVISION, INNER HOUSE, COURT OF SESSION
[2016] CSIH 55
XA85/15
Lord Brodie
Lady Clark of Calton
Lord Tyre
OPINION OF THE COURT
delivered by LORD BRODIE
in the appeal
by
BALGRAY LIMITED
Appellant;
against
WILLIAM HODGSON
Respondent:
Appellant: MacColl; Kennedys Scotland
Respondent: DM Thomson; Davidson Chalmers
15 July 2016
Introduction
[1] This is an appeal to the Court of Session on a question of law under section 88 of the Agricultural Holdings (Scotland) Act 2003, against a decision of the Scottish Land Court dated 6 August 2015. The pursuer and appellant is Balgray Limited, a company incorporated under the Companies Acts and having its registered office at 51 Rae Street, Dumfries. The respondent is William Hodgson.
[2] The decision of 6 August 2015 was in respect of an application by the appellant for declarator that a letter of 29 May 2014 sent by Stronachs LLP as agents for the respondent and addressed to “Michael John Jardine Paterson, Balgray, Lockerbie, Dumfrieshire”, was not a valid notice under and in terms of section 72(6) of the 2003 Act (and therefore not effective to continue the tenancy of the farm of Blindhillbush of which the appellant was landlord) and for an order for removal. The decision of the Land Court was to assoilzie the respondent from the craves of the application.
[3] The issue in the appeal is whether a letter addressed to someone who is not the landlord of an agricultural holding may, in the circumstances of the case, nevertheless constitute the giving of “notice to the landlord” for the purposes of section 72(6).
The questions of law for the opinion of the court
[4] The questions of law for the opinion of the court are as follows:
Section 72 of the 2003 Act
[5] Section 72 of the 2003 Act, as amended, provides:
“Rights of certain persons where tenant is a limited partnership
(1) Subsections (2) and (3) apply to a 1991 Act tenancy where the lease constituting the tenancy is entered into before the coming into force of this section and—
(a) the tenant is a limited partnership; and
(b) any limited partner is—
(i) the landlord or an associate of the landlord; or
(ii) a partnership or a company in which the landlord has a relevant interest.
(2) Where this subsection applies, any general partner may exercise or enforce any right of a tenant conferred by virtue of Part 2 of this Act as if the partner were the tenant in the partner’s own right ....
(3) Where this subsection applies and the tenancy purports to be terminated as a consequence of—
(a) the dissolution of the partnership by notice served on or after 16th September 2002 by a limited partner mentioned in subsection (1)(b);
(b) the renunciation of the tenancy on or after that date by such a partner; or
(c) a breach of the tenancy on or after that date by such a partner,
subsection (6) applies
...
(6) Where this subsection applies, notwithstanding the purported termination of the tenancy—
(a) the tenancy continues to have effect; and
(b) any general partner becomes the tenant (or a joint tenant) under the tenancy in the partner’s own right,
if the general partner gives notice to the landlord within 28 days of the purported termination of the tenancy or within 28 days of the coming into force of this section (whichever is the later) stating that the partner intends to become the tenant (or a joint tenant) under the tenancy in the partner’s own right.”
[6] Subject to registration requirements, the Limited Partnership Act 1907 allows for the formation of limited partnerships where a partner may be a general partner who takes part in the management of the partnership business or he may be a limited partner who does not take part in the management of the partnership business. A limited partner does not incur liability for the debts and obligations of the limited partnership but, subject to the terms of partnership agreement, he will be able to dissolve it on notice. Where the limited partnership is tenant under a lease then dissolution of the partnership will terminate the lease. With that eventuality in view a landlord may grant the lease of an agricultural holding to a limited partnership in which he or someone that he is associated with is a limited partner, so giving him the power to the bring the tenancy to an end. As is apparent from its terms, the purpose of section 72(6) is very specifically to afford protection to a general partner of a limited partnership in such circumstances. The nature of that protection is the limited security of tenure conferred by section 73 of the 2003 Act.
The facts
[7] The Land Court heard evidence from three witnesses: Mr Hamish Lean, a partner in Stronachs LLP and an accredited expert in agricultural law who had signed and sent the letter of 29 May 2014 as the respondent’s agent; Mr Michael Jardine Paterson, a director of the appellant, to whom the letter had been addressed and who had received it; and the respondent.
[8] In its note the Land Court provides a very full narrative of the evidence that it heard. It does not make specific findings in fact. While there would have been a convenience in it having done so, the absence of identified findings in fact perhaps does not matter. All three witnesses were found to be both credible and reliable and therefore where the Land Court records their evidence it can be taken to have accepted that evidence as fact. In any event the relevant facts fall within a relatively narrow compass. We would summarise them as follows.
[9] Until 28 May 2014 the respondent was the general partner in a limited partnership called Blindhillbush Farmers (No. 1) (“the partnership”). The partnership was the tenant and the appellant was the landlord of the farm of Blindhillbush, Boreland, Lockerbie, in terms of a lease entered into on 2 July and 12 December 2002 (“the lease”). The lease was governed by the Agricultural Holdings (Scotland) Act 1991. The partnership, which had come into being in 1999, was originally between the respondent as general partner and Michael John Jardine Paterson (“Mr Jardine Paterson”), a director of the appellant, as the limited partner but the appellant was assumed as an additional limited partner contemporaneously with the granting of the lease.
[10] The partnership was also tenant in the lease of a separate agricultural holding, Ravenscleuch (“the Ravenscleuch lease”) which was farmed by the respondent as general partner as one unit with Blindhillbush. The landlord of Ravenscleuch was Mr Jardine Paterson.
[11] The partnership was dissolved with effect from 28 May 2014 by notice served by the appellant and Mr Jardine Paterson on 26 April 2013. In consequence of that the lease terminated, as did the Ravenscleuch lease.
[12] By recorded delivery letter dated 29 May 2014 agents acting for the respondent purported to give notice under section 72(6). The notice was addressed not to Balgray Limited, nor to their registered office, but to “Michael John Jardine Paterson, Balgray, Lockerbie, Dumfriesshire”. It was in the following terms:
“Dear Sir
Notice under Section 72(6) Agricultural Holdings (Scotland) Act 2003
Holding of Blindhillbush Farm, Boreland, Lockerbie
On behalf of and as instructed by our client, William Hodgson, residing formerly at Yewtree Farmhouse, Kirkhampton, Carlisle, and now at Blindhillbush Farmhouse, Blindhillbush, Boreland, Lockerbie, general partner of the limited partnership firm of Blindhillbush Farmers (No 1) constituted by Contract of Limited Partnership between you, Michael John Jardine Paterson as limited partner thereof and the said William Hodgson, as general partner thereof dated 25th January and 8th February as amended by Addendum to Contract of Limited Partnership amongst you the said Michael John Jardine Paterson, Balgray Limited and the said William Hodgson dated 2nd July 2002, 12th December 2002 and 30th December 2002 whereby the said Balgray Limited was assumed as a limited partner under the said Contract of Limited Partnership and considering that the firm has been dissolved as at 28th May 2014 by virtue of Notice of Termination of Limited Partnership dated 26th April 2013 by you as limited partner aforesaid per your agents McJerrow & Stevenson, Solicitors, 55 High Street, Lockerbie, DG11 2JJ, we HEREBY GIVE NOTICE in terms of Section 72(6) of the Agricultural Holdings (Scotland) Act 2003 to you in your capacity as landlord of the tenancy of the holding of ALL and WHOLE the Farm and Lands of Blindhillbush Farm, Blindhillbush, Boreland, Lockerbie in terms of Lease between the said Balgray Limited and the said limited partnership firm of Blindhillbush Farmers (No 1) dated 2nd July and 12th December both months in the year 2002 that the said William Hodgson intends to become a tenant in his own right under the said tenancy, which tenancy was purported to be terminated in consequence of the said Notice of Termination of Limited Partnership.
Yours faithfully
Signed by Hamish Lean
For and on behalf of Stronachs LLP
Agents for William Hodgson”
[13] Mr Jardine Paterson was company secretary as well as director of the appellant. His fellow director was his son, David Jardine Paterson, the sole shareholder of the appellant. Although not its registered office, the appellant operated from Balgray House, which was Mr Jardine Paterson’s home. Mr Jardine Paterson dealt with practical problems which arose in the course of the lease and Smiths Gore, the appellant’s land agents, took their instructions from him. There was no evidence as to what role David Jardine Paterson took in the management of the appellant.
[14] Mr Jardine Paterson received the letter of 29 May 2014 shortly after it had been sent. At or about the same time he received a notice in terms of section 72(6) in respect of the Ravenscleuch lease, also dated 29 May 2014 (“the Ravenscleuch notice”). The Ravenscleuch notice was addressed to Mr Jardine Paterson and in this and in every other respect, other than the heading and specification of the lease, was identical to the letter of 29 May 2014. Mr Jardine Paterson accepted that he was not in any doubt but that the letter of 29 May 2014 had been intended to mean the same in relation to Blindhillbush as the Ravenscleuch notice meant in relation to Ravenscleuch.
[15] The Land Court inferred (and this was not challenged on behalf of the appellant) that the addressing of the letter of 29 May 2014 to Mr Jardine Paterson had simply been a mistake in the sense of an administrative or clerical or typographical error.
Decision by the Land Court
[16] At paragraph [128] of its note the Land Court begins by observing that although the respondent’s pleadings presaged arguments on agency, personal bar and variation of the lease, none of these were pursued at the proof. Instead, the only questions came to be whether the disputed notice had been validly given and, if so, what a reasonable recipient would have made of it.
[17] The Land Court immediately disposed of the second of these questions. In its opinion if the notice was validly given, a reasonable person in the position of Mr Jardine Paterson would have taken it to mean the same as the Ravensleuch notice but as referring to Blindhillbush. In other words, that the respondent was giving notice under sec 72(6) of the 2003 Act that he intended to become tenant in his own right under the Blindhillbush lease. Mr Jardine Paterson had admitted that he was not in any doubt as to what the notice was intended to mean nor, objectively assessed, could anyone in his position have been.
[18] This left what the Land Court described as the first question. The starting point was the terms of section 72(6). There were no requirements in the statute as to the form of notice or mode of service. The sub-section simply required that the general partner “gives notice to the landlord” but, and this was the nub of the case, the notice had to be given “to the landlord”. Here the letter of 29 May 2014 had been addressed to Mr Jardine Paterson and sent to his home. In the body of the letter it was said it gave notice to the addressee “in your capacity as landlord”. On the face of it, observed the Land Court, the letter was clearly a notice to Mr Jardine Paterson and not a notice to the appellant (see Land Court’s note paragraph [131]).
[19] The Land Court then considered the cases relied on by the parties in their respective submissions. The Court did not find them to be of assistance. It returned to the terms of section 72(6). The correct approach was to ask whether what had been done by way of the sending of the letter of 29 May 2014 had done what was required by the sub-section. What the sub-section required was to give “notice to the landlord within 28 days of the purported termination of the tenancy … stating that the partner intends to become the tenant … under the tenancy in the partner’s own right”. That there was no requirement for writing meant that the Land Court was not as tightly bound to the terms of the notice which was given as was the court in the case of Ben Cleuch Estates Limited v Scottish Enterprise 2008 SC 252, which had been relied on by the appellant. Indeed it would be wrong to take that approach; the Court had to look at things more widely. The correct question for the Court was not whether the letter of 29 May 2014 was a valid notice for the purposes of section 72(6) but whether the general partner had given notice to the landlord of his intention to become tenant under the tenancy in his own right (see Land Court’s note paragraph [143]).
[20] In the view of the Land Court that had happened. On the evidence Mr Jardine Paterson’s knowledge or state of mind could be taken to be the knowledge or state of mind of the appellant. He was its “directing mind and will”. He had received the letter of 29 May 2014 and he had understood its intended import which was that the respondent proposed to become tenant of Blindhillbush in his own right. It followed that the appellant had been given timeous notice of that.
Submissions of parties
Appellant
[21] Mr MacColl appeared for the appellant before this court as he had before the Land Court. He adopted his note of argument. The Land Court had erred in holding that the letter of 29 May 2014 fell to be construed as a proper notice to the appellant under and for the purposes of section 72(6). The sub-section required notice to be given to the landlord. Here the landlord was the appellant. Notice had not been given to the appellant. The only purported notice relied on was the letter of 29 May 2014. That had not been given to the appellant; it had been given to Mr Jardine Paterson and had been sent to his home address. Mr MacColl recognised that Mr Jardine Paterson was a director of the appellant and he accepted that Mr Jardine Paterson had appreciated that there had been a mistake in the letter, but it was nevertheless an error on the part of the Land Court to conclude that notice had been given to the appellant simply because Mr Jardine Paterson happened to be the appellant’s controlling mind. That did not mean that the court could effectively read out the mistaken reference to Mr Jardine Paterson as being the landlord and read in a reference to the appellant instead. What Mr Jardine Paterson may have made of the letter of 29 May 2014 is neither here or there. The court should only be concerned with what the recipient has made of what is relied on as a notice when it is satisfied that the notice has been validly given: Ben Cleuch Estates Limited v Scottish Enterprise at paras 59 to 65, and (although the decision of the Land Court was quashed of consent in this case by reason of it having been decided on the misapprehension that section 26 of the Interpretation and Legislative Reform (Scotland) Act 2010 applied) Colston Trust v Stoddart, Scottish Land Court, 24 October 2014 at paras 58 and 63. The critical matter was to whom the notice had been given. The Land Court came to the correct conclusion on that matter in paragraph [131] when it stated that the letter was clearly a notice to Mr Jardine Paterson and not a notice to the appellant. The correct approach was that identified in Ben Cleuch Estates Limited v Scottish Enterprise, Batt Cables plc v Spencer Business Parks Limited 2010 SLT 860, and West Dunbartonshire Council v William Thompson & Son (Dumbarton) Limited 2016 SLT 125. The Land Court had failed to follow that approach.
Respondent
[22] Mr Thomson, on behalf of the respondent, adopted his note of argument. He moved the court to refuse the appeal, answer the questions for the court in the negative and adhere to the Land Court’s interlocutor of 6 August 2015. Mr Thomson accepted that the ratio of Ben Cleuch Estates Limited fell to be applied to a statutory provision such as that found in section 72(6) as it did to a conventional provision, such as a stipulation in a lease. The question will always be whether the notice relied on conforms with the terms of the power to give it. However, a critical difference between the terms of section 72(6) and the relevant provision in Ben Cleuch was that section 72(6) provides that notice can be given by any means, it need not be given in writing. While the question as to whether the Land Court was entitled to hold that notice had in fact been given by the appellant remained, one was not restricted to looking at the precise terms of the letter of 29 May 2014; one was allowed, indeed compelled, to look at the matter more broadly. Properly analysed, the Land Court’s note demonstrated that it had understood and correctly applied Ben Cleuch. Where a particular writing was founded on, the relevant question came to be whether the writing had brought the requisite information to the attention of the landlord. Admittedly, difficult questions might arise in circumstances where the requisite information had come to the attention of the landlord but by a circuitous route. These, however, would be questions of fact. In the present case the relevant question could be answered in the affirmative. The letter was addressed to the person who was in fact the controlling mind of the appellant, a finding which had not been challenged. The requisite information was the intention of the respondent to become tenant in his own right. On the facts of the case that intention had been successfully communicated by the general partner to Mr Jardine Paterson and thus to the appellant. The Land Court had accordingly been correct to fix the appellant with the knowledge of Mr Jardine Paterson, as its directing mind and will: Lennard’s Carrying Co Ltd v Asiatic Petroleum Co Ltd [1915] AC 705 at 713-714, El Ajou v Dollar Land Holdings plc [1994] 2 All ER 685 at 696A, Liquidator of Letham Grange Developments Co Ltd v Foxworth Investments Ltd 2011 SLT 1152 at paras 20 to 24. Thus, the general partner had given notice of his intention to become the tenant. The Land Court had not erred.
Decision
[23] As Mr Thomson identified, section 72(6) of the 2003 falls within the category of provisions which confer power on a specified person or persons which may be exercised by the giving of “notice” to another person: cf Mannai Investments Co Ltd v Eagle Star Life Assurance Co Ltd [1997] AC 749 at 780H- 781C. The provisions may be statutory, as in the present case, or they may be conventional, in other words they may be constituted by contract or grant.
[24] Because exercise of the relevant power in such circumstances is at the option of the person having the power, something will be required of that person to signify that the power has indeed been exercised. The “something” is of the nature of a juristic act. What is required to constitute it will depend upon the terms in which the power is conferred and, as Sir David Edward put it in Scrabster Harbour Trust v Mowlem plc 2006 SC 469 at para [47], “if strict compliance with a particular condition is called for, strict compliance will be enforced.”
[25] It was a matter of agreement between counsel that what was said in Ben Cleuch Estates Limited applies to the exercise of a statutorily conferred power as it applies to the exercise of a conventionally conferred power. The point of difference relied on by Mr Thomson as between Ben Cleuch and the present case was that in Ben Cleuch exercise of the power required the giving of a notice in writing. Because section 72(6) did not require the notice to the landlord to be in writing, albeit it required the notice to be “to the landlord”, in a case such as the present where all the requisite information was contained in a writing, notice could be regarded as given “to the landlord” as long as the contents of that writing had come to the attention of an individual landlord or, where the landlord was incorporated, to such person as fell within the description of its controlling mind.
[26] Mr Thomson submitted that, on a careful analysis of its note, the Land Court had properly applied Ben Cleuch. As we shall explain, we are not satisfied that that is so. The relevant provision in Ben Cleuch was contained in Clause FOURTH (B) of a lease. It conferred a break option on the tenant. In order to exercise that option the tenant was required “to give the Landlords at least one year’s written notice of termination of this lease”. At the relevant time Ben Cleuch Estates Ltd was the landlord. It was a wholly owned subsidiary of Bonnytoun Estates Ltd. Ben Cleuch and Bonnytoun shared a registered office and at least one director, Mr Cairns, who was also company secretary of both companies. The tenant served a break notice. It was addressed to Bonnytoun and sent to the registered office shared by the two companies (Pacific House). It ultimately found its way into the hands of Mr Cairns. The Lord Ordinary held that the break notice had not been validly exercised. His decision was upheld by in Inner House. In giving the opinion of the court Lord Macfadyen said this:
“[59] In our opinion the Lord Ordinary reached the correct conclusion on this aspect of the case: the break notice sent to Bonnytoun at its registered office was not given to the landlords of the premises, and was therefore ineffective.
[60] The matter turns, in our opinion, on the proper application of Clause FOURTH (B). That clause confers on the tenants an option to bring the lease to a premature end after 14 instead of 25 years. It provides that, in order to exercise that option, the tenants must ‘give to the Landlords’ at least one year's written notice of termination. It was accepted on the defenders' behalf, rightly in our opinion, that for a break notice to be effective, it required to comply with that requirement (Muir Construction Ltd v Hambly Ltd 1990 SLT 830; Capital Land Holdings Ltd v Secretary of State for the Environment 1997 SC 109; Scrabster Harbour Trust : we note that, in Mannai Investment, pp 781B–C, Lord Clyde identified the requirement in that case that the notice had to be served on the landlord or its solicitors as part of the substance of the power to serve the break notice). The dispute was as to whether what occurred constituted such compliance. In our opinion, that dispute can be resolved very shortly: a notice addressed to a party other than the landlord and sent to the registered office of that other party cannot be regarded as a notice given to the landlord.
…
[62] ... Senior counsel suggested that the notice could be regarded as addressing the landlord, whoever that might be, independently of the identity of the named party to whom the notice bore to be addressed. That is not, in our view, a tenable argument. The notice was addressed to Bonnytoun. The reference in the text of the notice … was in these terms: ‘We refer to the Lease … in respect of which you are the current landlords’. That must be read as an assertion that Bonnytoun are the current landlords, rather than as an observation addressed to whichever party was the current landlords, whether Bonnytoun or some other party.
[63] That the break notice sent to [the registered office] ultimately found its way into the hands of Mr Cairns is in our view of no assistance to the defenders. Clause FOURTH concentrates on the party to whom the notice is given, not the party who may ultimately receive it. The notice was addressed to Bonnytoun. It was sent to Bonnytoun's registered office. It was received there, and in due course seen by Mr Cairns in his capacity as a director of Bonnytoun. That he happened also to be a director of Ben Cleuch, and thus acquired knowledge of the notice, and was able to react to it, in that capacity does not, in our opinion, convert a notice given to Bonnytoun into a notice given to Ben Cleuch.
[64] Nothing turns in this case on the construction of the notice. It was invalid because it was not given to the landlord, but to a third party. The stage of considering how the notice would be understood by the recipient is not reached. Mr Cairns's candid admission that he was not misled by the terms of the notice is therefore of no avail to the defenders. None of the cases cited which turned on construction of the notice was concerned with the situation in the present case, where the notice was given to the wrong party. They concerned the different question of how a notice, given to the correct party but containing erroneous information on other matters, would be understood by the correct recipient.
[65] We therefore conclude that the break notice sent by the defenders to Bonnytoun at [the registered office] was not given to the landlords under the lease, but to a third party, and for that simple reason was ineffective to terminate the lease.”
[27] When it came to the part of its note containing a discussion of the issues and its decision, the Land Court began by posing what it considered to be the only questions in the case. These were whether the disputed notice had been validly given and, if so, what a reasonable recipient would have made of it (paragraph [128]). It quickly disposed of the second question (which does not appear to have been contentious): Mr Jardine Paterson had admitted that he was not in any doubt as to what the notice was intended to mean nor, objectively assessed, could anyone in his position have been (paragraph [129]). The position on that matter was therefore on all fours with Ben Cleuch, where Mr Cairns had candidly admitted that he had not been misled by the terms of the notice.
[28] The Land Court then turned to its first question. It noted that while there were no requirements as to the form of the notice or mode of service stipulated by section 72(6), it had to be given “to the landlord” and that was the nub of the case. What had happened was that the notice was addressed not to the appellant, which was the true landlord, but to Mr Jardine Paterson, who was not. It was said in the body of the notice that it was given to Mr Jardine Paterson “in [his] capacity as landlord”. It was therefore, according to the Land Court “clearly a notice to Mr Jardine Paterson and not to Balgray Ltd” (paragraph [131]. Had the Land Court been following Ben Cleuch, as Mr Thomson said it had been, it is difficult to understand why that conclusion did not lead it to the further conclusion that the answer to its first question was that the disputed notice had not been validly given; it being recalled that in Ben Cleuch given the break notice was sent to Bonnytoun and not to Ben Cleuch, “for that simple reason [it] was ineffective to terminate the lease”: Ben Cleuch at para [65].
[29] However, the Land Court did not so conclude. Rather, it continued with its process of reasoning. It considered a line of argument on behalf of the respondent which was not pursued by Mr Thomson before us and then, at paragraph [140], reiterated that the consequence of a failure to give notice to the landlord under section 72(6) is that the tenancy terminates with the dissolution of the limited partnership. There can be no quarrel with that. Having at paragraph [142] summarised what it saw as salient features of Ben Cleuch, at paragraph [143] the Land Court appeared to remain firmly on track: “Just as the correct approach in Ben Cleuch was to ask whether what was done conformed with the requirements of the lease, the correct approach for us is to ask whether what was done conformed to the requirements of section 72(6)”. However, immediately thereafter the Land Court changes course. It states that the “requirements [of section 72(6)] are very different from those in Ben Cleuch”. We would pause to observe that, for all relevant purposes, that is just not so. True, the notice in Ben Cleuch required to be in writing which is not the case with a notice under section 72(6), but that distinction falls away once a general partner chooses to give what he intends as a section 72(6) notice in the form of writing. Having chosen writing as the medium of giving notice, the juristic act which the general partner must perform if he is to exercise the section 72(6) power is to give notice in writing “to the landlord”. As we have already pointed out, that is what the Land Court had found at paragraph [131] of its note not to have been done in this particular case.
[30] We admit to difficulty in understanding just how the Land Court, having held in paragraph [131] of its note that the only means of giving notice which was founded upon, that being the letter of 29 May 2014, was “not a notice to Balgray Ltd”, nevertheless felt able to conclude, as it did in the final sentence of paragraph [144] that “Balgray Ltd, as landlords, were given timeous notice”. Having, correctly as we would see it, recognised in paragraph [143] of its note that the approach that it should take was to ask whether what was done conformed to the requirements of section 72(6), the Land Court signals its change of course as follows: “That there is no requirement for written notice means that we are not as tightly bound to the terms of the notice given as was the court in Ben Cleuch. Indeed it would be wrong for us to take that approach. Instead we must look at things more widely.” With all due respect to the Land Court, we find the meaning of these sentences to be obscure. They immediately precede a further sentence which is no easier to understand: “The correct question for us is not whether the letter of 29 May 2014 was a valid notice for the purpose of section 72(6) but whether the general partner has given notice to the landlord of his intention to become tenant under the tenancy in his own right.” The Land Court supposes that there is a distinction to be made between the two questions it poses in that sentence. There is however no distinction; they come to exactly the same thing.
[31] Having set itself to answer the question formulated as “whether the general partner has given notice to the landlord of his intention to become tenant under the tenancy in his own right”, the Land Court proceeds to answer it in the affirmative in paragraph [144] of its note. Put short, as we have already mentioned, this was because Mr Jardine Paterson had received the letter of 29 May 2014 and had understood its intended import. As he was the directing mind and will of the appellant, his knowledge could be attributed to it and accordingly the appellant was given notice.
[32] We consider the Land Court’s conclusion to be wrong and we regard that as so from a number of perspectives. First, and fundamentally, it fails to address the short and simple point made to it by Mr MacColl and repeated to this court: to be valid, a section 72(6) notice must be given “to the landlord”. As the Land Court found, what the respondent relies on as notice, that is the letter of 29 May 2014, was not given to the landlord; it was given to somebody else. Were there any doubt about that (and we do not suggest that there is), it would be resolved by consideration of what was said in Ben Cleuch at para [60]: “a notice addressed to a party addressed to a party other than the landlord …cannot be regarded as a notice given to the landlord.” What is said on behalf of the respondent in the present case is that this may be so but nevertheless the contents of the letter came to the attention of Mr Jardine Paterson and he is someone who, for practical purposes, can be regarded as the equivalent of the appellant, as its directing mind and will. That of course is to shift the emphasis away from a juristic act by the general partner, which is what the subsection requires, to something done (acquiring information) by, or at least on behalf of, the landlord, but again the matter is dealt with in Ben Cleuch: “That …a director of Ben Cleuch …acquired knowledge of the notice, and was able to react to it in that capacity does not …convert a notice given to Bonnytoun into a notice given to Ben Cleuch.”
[33] We would add this. In this area of the law there is a need for certainty, to the extent that that is possible. Parties need to know their respective positions and thus need to be able readily to ascertain whether or not a notice has been given. The law must therefore provide a bright line test. Mr Thomson was unable to provide such a test. All he could say was that the circumstances of the present case were such as to meet what section 72(6) required. He acknowledged that there may be cases where the requisite information had come to the attention of the landlord, but by such an indirect or circuitous route that it could not be said that statutory notice had been given. If we understood him correctly he accepted that had the letter of 29 May 2014 been sent to David Jardine Paterson that would not have been enough. We see Mr Thomson’s understandable difficulty to be of importance. It is simply not satisfactory that the short question: whether notice has been given and therefore whether a statutory or conventional power has or has not been exercised, should be allowed to be determined on the basis of a wide ranging enquiry into the state of knowledge of the person who should have been given notice but was not and how that state of knowledge came about. That is not a way to achieve certainty or indeed consistency.
Disposal
[34] We shall accordingly answer both the questions of law for the opinion of the court in the affirmative. This court has power in an appeal under section 88 to quash, confirm or vary the determination complained of or any part of it. It also has power, where it quashes the determination of the Land Court or any part of it, to remit the case to the Land Court for further procedure. On behalf of the appellant Mr MacColl moved the court, in the event of the questions of law being answered in the affirmative, as he contended they should be, to recall the interlocutor of the Land Court and grant declarator in the following terms (these being the terms of the appropriate crave in the application to the Land Court):
A motion in these terms was included in the appellant’s note of argument and no issue was taken by Mr Thomson with this as the appropriate disposal in the event of the appeal succeeding. We are accordingly minded to grant decree in the terms proposed by Mr MacColl. We note that he said nothing about removal and we take that to be deliberate. However, lest any question arise as to the terms of the court’s interlocutor and to allow the matter of expenses to be dealt with, we shall bring the case out by order before finally disposing of it.
