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In Keshwala & Anor v Bhalsod & Anor, the premises in Leicester were demised for a term of 20 years in 2008. The property consisted of a lockup shop on the ground floor, with living accommodation above.
The tenants fell into arrears in July 2015. Due to an error, only £1,500 of the £2,000 quarterly rent was paid in June 2018, a mistake which no one except the landlords realised.
An invoice was raised for the next quarter’s rent, which made no mention of the £500 shortfall.
On 13th September 2018, the landlords affected forfeiture by peaceable re-entry. The arrears were paid off on 24th September, but there was limited contact between the parties after that.
On 4th February 2019, the landlords re-let the premises on a three-year lease but on 26th February 2019; the disposed tenants applied for relief from forfeiture.
The Judge declined to grant relief, especially on account of the delay in the tenants’ application. The Judge felt that if the application had been made more promptly, relief would have been granted. The tenants successfully appealed the decision to the High Court and obtained relief from forfeiture.
However, the Court of Appeal has reinstated the County Court decision stating that “there is no principle that a tenant will be deemed to have acted with reasonable promptitude so long as he brings his application for relief before the expiry of six months. A tenant who waits for nearly six months before bringing his application, keeps the Landlord in the dark about his intentions, and fails to provide the Court with any explanation for the delay, may well find that the Court concludes that he has not acted with promptitude”.
Relief from forfeiture is available to a tenant provided it makes good the loss to the Landlord, and the breach is capable of remedy. There are time limits within the tenant must make its application depending upon whether the Landlord proceeds through the Court, or by peaceable re-entry and whether for non-payment of rent or other breaches of covenant.
However, the tenant must not view a time limit as giving it the freedom to sit back and apply for relief at any time within the period. Relief is discretionary. Therefore, the message to tenants is that they can sit back, consider their position and then apply for relief at the end of the period; they must communicate with the Landlord in the interim and act promptly.