The case of Sunnymeads Motor Company Ltd v Tolfree-Cross [2024] highlights the importance of ensuring statutory deadlines to issue proceedings are met, and the risks of failing to pay court issue fees in time
In this case, the tenant, a buyer and seller of used cars, had occupied premises under a lease which had expired in October 2018, after which time it had remained in occupation paying rent to the landlord but without a formal lease in place.
The landlord had more recently sought to encourage the tenant to leave, so that it could sell the premises. It had then served a notice pursuant to Part II of section 25 of the Landlord and Tenant Act 1954 (1954 Act) saying that it would oppose the grant of a new tenancy. That notice expired on 3 September 2023.
On 11 September 2023, the landlord blocked access to the premises. The tenant applied for and obtained an interim injunction forcing the landlord to allow the tenant back into the premises. This hearing was to determine whether that injunction should be continued to trial.
The question of whether an interim injunction should be granted or continued is determined by reference to the principles in the case of American Cyanamid (American Cyanamid co v Ethicon ltd [1975] ukhl 1). In short, the Court must first determine whether there is a serious issue to be tried. If there is, it must decide whether the balance of convenience lies in granting or refusing the injunction. It is also usual for the Court to require the party seeking an interim injunction to give an undertaking that it will compensate the other party should the ultimate determination of the underlying issue be resolved against them.
Whether there was a serious issue to be tried depended on whether the tenant had an arguable case that it had issued an application for a new tenancy under the 1954 Act prior to the deadline, which was close of business on 3 September 2023.
Provided that such an application was made in time, the tenant would have had the right to continue to occupy the premises until that application were determined. The landlord disputed that the application had been made in time.
To make an application, broadly speaking the relevant paperwork must be received before the deadline by the court office. The court also charges a fee to issue such applications.
It is fairly straightforward to arrange for the paperwork to be delivered and the fee to be paid, so what had happened here?
The short answer is that everything was left to the last minute and then handled in a confusing manner. On 2 September 2023 (ie. the day before expiry of the section 25 notice) the tenant’s solicitors had sent an application to the county court. The application contained the claimant's telephone number, with the intention being the court office would call the claimant to take the payment. The court system is generally overloaded so it would be optimistic at the best of times to expect a call back immediately or even at all. On the last but one day to make a time-critical application, this was clearly asking for trouble.
Having not heard back from the court and not having had any confirmation of receipt, the tenant’s solicitors then took a further application to a different court on 3 September, this time with a cheque for payment. The cheque was however not signed, so could not be processed. Then, some days after the deadline, the tenant’s solicitors made a third application. This application was issued and the application for an interim injunction was issued within those proceedings.
In the interim, the landlord had obstructed the tenant’s access to the premises. The case does not describe what the landlord knew about the tenant’s attempts to make the relevant applications to court at this point.
In coming to his decision, the Judge went through the legal authorities. These establish that it is generally sufficient for the paperwork to reach the court office during normal court office hours within the relevant deadline. In the case of the first two applications, this had taken place. The law on whether the court must receive court funds within the same timescale is less clear, with modern methods and practices for making payment not having previously been considered in depth, and not in the context of this issue.
The Judge concluded that there was a serious issue to be tried on this point, which left the balance of convenience to be considered. (There was also a subsidiary question of whether the tenant’s actions had given rise to an abuse of process, which for the sake of brevity is only here mentioned in passing.)
As to where the balance of convenience lay, the tenant’s exclusion from the premises pending a trial would have potentially serious ramifications. The landlord had been given an opportunity to submit evidence setting out the impact which a continuing injunction would have on it. It submitted a witness statement very late in the day, past the deadline for doing so. The Judge considered the landlord’s evidence, but was understandably unimpressed by the late filing, which had deprived the tenant of an opportunity to consider this in detail.
The result was that the balance of convenience was resolved in the tenant’s favour, with the interim injunction being granted until trial.
The moral of the story is one often relayed to recalcitrant schoolchildren: don't leave things until the last minute (especially not time critical court applications)!
