The Tropical Zoo Limited v The Mayor and Burgesses of the London Borough of Hounslow
[2024] EWHC 1240 (Ch)
29 Buckland Crescent Management Company Limited v Rojer Taylor White
19 June 2024
[2024] EWHC 1480 (Ch)
High Court
A landlord and tenant settled a dispute with an agreement that included a general release of claims. The tenant didn't fix the problem, so the landlord sued again. The judge decided the settlement agreement didn't actually stop the landlord from suing. It was a tricky legal argument about the precise wording of the agreement and what the two parties really meant when they signed it. The court decided the landlord's interpretation made more sense in the context of their difficult relationship.
Key Facts
- •29 Buckland Crescent Management Company Ltd (Landlord) appealed a County Court decision that a Settlement Agreement precluded forfeiture proceedings against Roger Taylor White (Mr. White), lessee of a flat.
- •The dispute centered on leaks from Mr. White's flat, breaching a repairing covenant in the lease.
- •A Settlement Agreement settled prior FTT proceedings, including a claim for disrepair, with Mr. White admitting the breach and agreeing to remedial works.
- •The Settlement Agreement included broad release clauses (Clauses 6 and 7) with an exception for claims 'in respect of any breach of this agreement' (Clause 7.2).
- •The Landlord argued Clause 7.2 allowed forfeiture proceedings, while Mr. White contended it was precluded by the general release.
- •The Judge found the forfeiture proceedings were not 'in respect of' a breach of the Settlement Agreement.
Legal Principles
Contract interpretation involves ascertaining the objective meaning of the language used, considering the contract as a whole and the background knowledge available to the parties. If two constructions are possible, the court prefers the one consistent with business common sense.
Lukoil Asia Pacific Pte Ltd v. Ocean Tankers (Pte) Ltd [2018] EWHC 163 (Comm)
A clause in a contract should not be interpreted as otiose (redundant) if possible.
Nord Naptha v New Stream Trading [2021] EWCA Civ 1829
For 'long leases of dwellings', the Landlord needs either a First-tier Tribunal (FTT) determination or admission of breach before serving a s146 notice under the Law of Property Act 1925, as per the Commonhold and Leasehold Reform Act 2002.
Commonhold and Leasehold Reform Act 2002, s168; Law of Property Act 1925, s146
Outcomes
The Landlord's appeal was allowed.
The court found that Clause 4 of the Settlement Agreement, acknowledging Mr. White's breach and outlining remedial works, strongly indicated an intention to preserve the right to forfeiture if the works were not performed. This interpretation was supported by the factual matrix of a strained relationship and the significance of resolving the leak issue. While the 'ordinary meaning' of Clause 7.2 was ambiguous, the court considered the cumulative effect of the evidence favored the Landlord's interpretation.