Seminar Notes 24.10.07 Surinder Bhakar

2 Gray's Inn Square Chambers

Seminar Notes 24.10.07 - Surinder Bhakar

Home

Contact

Seminar Notes

These notes were prepared by Surinder Bhakar and form part of the seminar Termination of Tenancies for Tenant Default given on 24th October 2007 by the 2 Gray's Inn Square Chambers Property & Commercial Group.

Surinder Bhakar

Index

Fixtures, Delivery Up and Goods Left Behind

Fixtures revisited

Fixtures and Chattels:

Whether a chattel has been fixed to the land or buildings so as to become a ‘fixture’ depends on the circumstances of each case but particularly on 2 key factors: (a) the degree of annexation and (b) the object and purpose of the annexation (Holland v. Hodgson (1872) LR 328 at 334, Elitestone Ltd. v. Morris (1997) 2 All ER 513). Other relevant considerations include the following: whether the chattel can be removed without doing irreparable damage to the premises, the method of annexation, whether the item can only be enjoyed in situ as a whole and the terms expressly or impliedly agreed between the fixer of the chattel and the owner of the land.

Fixtures at the end of the tenancy:

On the determination of a tenancy the question may arise as to what items the departing tenant may remove. As a general rule, it is the duty of the tenant not to remove fixtures from the land. They must be ‘delivered up’ to the landlord on the determination of the tenancy. As between the landlord and the tenant, the right to remove an item brought onto the land would exist: (a) when the item has never become in a law a fixture, (b) when there is a ‘rule of relaxation’ in favour of trade, agriculture, ornament or convenience or (c) when the right is conferred by custom or agreement. Subject to the above, fixtures left on the premises after the determination of the tenancy, for whatever reason, become the property of the landlord (Re Thomas, ex Baroness Willoughby d’Eresby (1881) 44 LT 781, Pole-Carew v. Western Counties and General Manure Co (1920) 2 Ch 97, Smith v. City Petroleum Co. Ltd (1940) 1 All ER 260).

Tenant’s fixtures and landlord’s fixtures:

‘Tenant’s fixtures’ usually refers to chattels which have become fixtures but which are removeable by the tenant. Where fixtures are removeable, they remain part of the freehold until severed. If they are not removed during the tenancy or in some cases, within a reasonable time thereafter they become the property of the landlord (Re Thomas, ex Baroness Willoughby d’Eresby, Pole-Carew v. Western Counties and General Manure Co, Smith v. City Petroleum Co. Ltd). ‘Landlord’s fixtures’ usually refers to fixtures which the tenant may not remove (Boswell v. Crucible Steel Co (1925) 1KB 119).

Trade Fixtures:

‘A tenant’s fixture is one which has been annexed by a tenant to the land, is so annexed for the purposes of his trade or for mere ornament and convenience; and is physically capable of removal without causing substantial damage to the land and without losing its utility.’ (Paragraph 1681 of Volume 1 of Hill & Redman’s Law of Landlord and Tenant and New Zealand Government Property Corporation v. HM & S (1982) QB 1145). ‘The principle, therefore, is that where an article, such as machinery, has been attached to the demises premises by the lessee so as to become a fixture for the purpose of trade and it is a chattel perfect in itself, independently of its union with the soil and can be removed without being entirely demolished or losing its essential character or value, the lessee is entitled, in the absence of agreement to the contrary, to sever it from the premises and to remove it' (Paragraph 1681.2 of Volume 1 of Hill & Redman’s Law of Landlord and Tenant).

Index

Articles not attached to soil:

An article which is no further attached to the land than by its own weight, notwithstanding that it sinks into the ground, or rests by its own weight on foundations or is inserted in a place prepared for it in the ground, is not generally to be regarded as a fixture. Ordinarily there must be some degree of direct attachment between the article and the land or building (Turner v. Cameron (1870) LR 5 QB 306 at 311, Manchester Development Ltd v. Garmanson Ltd (1986) QB 1212). However, the absence of attachment between the article and the land is not conclusive eg. a free-standing house is still part of the land (Elitestone Ltd v. Morris), blocks of stone used without water or cement to form a stone wall (Holland v. Hodgson), sculptures forming part of the architectural scheme of a house (d’Eyncourt v. Gregory (1866) LR 3 Eq 382 at 396).

Onus of proof:

The onus of showing that articles not attached to the land have nonetheless ceased to be chattels and have become fixtures lies on the party making the assertion. But the onus of showing that articles attached to the land are not fixtures but remain chattels lies on the party making the assertion (Holland v. Hodgson, Jordan v. May (1947) KB 427).

Purpose of attachment:

Where an article is actually attached to the land or building, the question of whether it is a chattel or fixture depends on: (a) the purpose of the item and (b) the purpose of the link between the item and the land or building (Corthorn Land and Timber Co. Ltd v. Minister of Housing and Local Government (1965) 17 P & CR 210, TSB Bank Plc v. Botham (1997) 73 P& CR 1). If the article is intended to be permanent and to afford a lasting improvement to the land or building, it will be a fixture. If the attachment is intended to be temporary and no more than necessary for the use and enjoyment of the item, it remains a chattel. Relevant considerations include the following: is it ornamental, can it be removed without damage to the fabric, are there relevant agreements with a third party and who attached the item ?

Mere convenience or necessity:

If the item can be removed without damage to the land or building and was placed in position for the more convenient use of the chattel and not as a necessity, it is not likely to be a fixture eg. a Portakabin, folding seats screwed to the floor of a cinema, petrol pump affixed to tank embodied in concrete (Hobson v. Gorringe (1897) 1 Ch 182 at 190, Spyer v. Philipson (1931) 2 Ch 183, Webb v. Frank Bevis Ltd (1940) 1 All ER 247). On the other hand, the ‘mere convenience of use test’ is also not conclusive. If the presence of such an article is an essential feature of the land or building, then the article will be treated as a fixture, even though it is capable of being moved from one part of the premises and fastened in another (Boyd v. Shorrock (1867) LR 5 Eq 72).

Custom or express stipulation:

The tenant’s right to remove trade or other fixtures may be restricted by custom or by the terms of the contract between the landlord and the tenant. The tenant may expressly give up his right to remove what would otherwise be regarded as tenant’s fixtures. The lease may contain a covenant by the tenant to deliver up all fixtures or specified items and all other fixtures with or without provision for payment. As a matter of construction, it has been held that the word ‘fixtures’ if it stands in the covenant by itself, without further qualification, will apparently include both landlord’s and tenant’s fixtures (Leschalles v. Woolf (1908) 1 Ch 641). It is, of course, a question of careful construction of and giving proper effect to the general and specific words used in the particular covenant agreed by the parties.

Index

Removal of fixtures:

10.

Where a tenant is entitled to remove fixtures the general rule is that he must exercise the right of removal during the term, irrespective of whether the term comes to an end by effluxion of time, surrender or forfeiture (British Economical Lamp Co. Ltd v. Empire, Mile End Ltd (1913) TLR 386, Re Roberts (1878) 10 ChD 100, Pugh v. Arton (1869) LR 626). If the tenant omits to remove the fixture during the term or during any extended period they become the absolute property of the landlord. If the tenant remains in possession after the term, in circumstances where he is still entitled to be considered as the tenant, his right to remove fixtures is extended through the period he remains in lawful possession. Where a tenant is entitled to remove fixtures under the provisions of a lease he can remove them within a reasonable time after the determination of the term (Pugh v. Arton, Sumner v. Bromilow (1865) 34 LJQB 130). Articles which are properly chattels and not fixtures may be removed after the term has expired (Darby v. Harris (1841) 1 QB 895).

Remedies of landlord and tenant:

11.

Where a tenant has improperly removed fixtures, the landlord may seek damages either in tort for waste (the amount of injury to the reversion) or for breach of a covenant to deliver up the premises in proper repair or pursuant to any specific provision relating to fixtures (their actual value but not exceeding the amount of damage to the reversion) (Mancetter Development Ltd v. Garmanson Ltd (1986) QB 1212). Other remedies may be an injunction to prevent a threatened removal or an action for wrongful interference with goods following a wrongful removal (for the value of the fixtures as chattels). A tenant or a person claiming under him, who has the right to remove fixtures, may bring an action against any person upon whom the right is binding who has prevented him from exercising it and seek the value of the fixtures as severed. However, a tenant may only bring an action for wrongful interference with goods, once fixtures to which he has a right, have been severed.

Modern illustrations:

12.

In Graham Charles Botham & Ors v. TSB Plc (1996) EGCS 149 the Court of Appeal held that in determining which chattels in mortgaged premises were fixtures and which were removable by the mortgagor on the mortgagee obtaining an order for possession involved a consideration of two tests: (i) the method and degree of annexation; and (ii) the object and purpose of annexation. Where an item had been attached to the property by more than its own weight, if the item viewed objectively was intended to be permanent and to afford a long lasting improvement to the building it would become a fixture. If the attachment was temporary and was no more than was necessary for the item to be used and enjoyed then it would remain a chattel. A relevant factor was whether or not the item could be removed without damaging the fabric of the building. In Robin Arthur Elidyr Herbert and Ors v. BRB and Railtrack Plc (15 October 1999 unreported see Lawtel) the Court of Appeal held that, where a lessee covenanted to keep equipment in good repair and deliver it up at the end of the term in good repair, it was not possible to infer an intention that the equipment to which the covenant related could be regarded as a trade fixture of the tenant. By the terms of the lease no inferences could be made that the tenants had rights to remove rails and sleepers

Index

Delivery Up

Obligation to deliver up:

13.

At the end of the tenancy, the tenant is obliged to ‘yield up’ or deliver possession to the landlord. The tenant will be in breach of his obligations if he does not remove chattels and any other articles which do not form part of the land or buildings. A landlord can insist on the removal of rubbish which substantially interferes with his possession. In Cumberland Consolidated Holdings Ltd. v. Ireland (1946) KB 264) which concerned a ‘sale with vacant possession’, the cellars of a disused warehouse were made unusable by sacks of cement many of which had hardened. It was held that the defendant had failed to give vacant possession of the property sold. A vendor who leaves chattels of his own on property sold by him to an extent depriving the purchaser of the physical enjoyment of part of the property has failed to give vacant possession and it is no answer for the vendor to have abandoned his ownership of the chattels on completion.

Yielding up:

14.

It is a question of fact whether a tenant has in ‘yielded up’ possession. In John Laing Construction Ltd v. Amber Pass Ltd (2004) 17 EG 128 (CS), it was held that there was no prescribed form or procedure for ‘yielding up’. The court had to look at the facts objectively and determine whether there had been a clear intention by the person whose acts were said to have brought about a termination to effect such termination and whether the landlord could, if he wanted to, occupy the premises without difficulty or objection. The tenant’s retention of the keys did not signify any intention on his part to assert any rights in respect of the premises. (In that case, it was held that in the light of security problems at the site, the instruction of security staff and the use of removable concrete barriers did not cause a hindrance to the landlord. The tenant had clearly and obviously demonstrated a wish to terminate the lease. The tenant had served notice compliant with the conditions of validity and effectiveness of the lease and had done as much as was necessary to show the landlord that the tenant asserted no right to the premises and had left the landlord to occupy or deal with the premises as it wished).

Failure to deliver up:

15.

A tenant who holds over and fails to deliver up will be liable for damages for breach of his express or implied covenant to deliver up possession and also as a trespasser. In the case of joint tenants, where one holds over and the other assents to the holding over, both will be liable in damages, otherwise only the tenant who holds over will be liable. The landlord will be entitled to damages for the actual loss sustained by him in accordance with usual principles for the quantification of damages. The award will normally include a sum equal to the rental value of the premises during the time the landlord is kept out of possession and the reasonable damages and costs incurred by the landlord in respect of claims against him naturally arising out of the tenant’s failure to deliver possession. A tenant may also be liable for any damage suffered by the landlord due to the premises deteriorating while the landlord is wrongfully kept out of possession (Associated Deliveries Ltd v. Harrison (1984) 50 P & CR 91).

Yielding up and fixtures:

16.

The tenant may in the repairing covenants of a lease contractually bind himself to yield up in repair not just the premises but certain fixtures, erections or improvements eg. a greenhouse, veranda and plate glass-front. A covenant to leave at the end of the term all erections, fences and fixed machinery in good repair and condition is sufficient to deprive the tenant of his right to remove trade fixtures (Re British Red Ash Colleries Ltd (1920) 1 Ch 326 now applied by the Court of Appeal in Robin Arthur Elidyr Herbert and Ors v. BRB and Railtrack Plc).

Index

Goods left behind - the problem

17.

What does a landlord do with goods left on the premises after the tenant has vacated, can the landlord dispose of them, can he sell them or how long must he look after them ?

18.

This is a real practical and legal problem for business (and residential) landlords, which depending on the nature and value of the goods left behind, may involve potential financial loss to the landlord and possible legal liability to the tenant. An obligation to look after goods left behind may involve: (a) moving and transporting uncollected goods, (b) safe storage of the goods and (c) legal disposal of the goods.

19.

The starting point must be to consider the terms and conditions of the lease, tenancy agreement, or other contractual document between the landlord and the tenant. Ideally, with foresight, there will be provisions dealing with good left behind by the tenant, for example, a clause giving the landlord the right to discard or sell any items which remain uncollected after a reasonable period of time stipulated by the agreement, with or without the giving of notice to the tenant.

20.

However, as is common, the lease, tenancy agreement or any other written agreement between the parties, may be silent on the subject of goods left behind by the tenant. In these circumstances, the law of bailment comes into play together with the provisions of the Torts (Interference With Goods) Act 1977 (TIGA 1977).

Index

Goods left behind - legal framework - case law

21.

The earlier cases must, of course, now be read subject to the provisions of the Protection from Eviction Act 1977.

Aglionby v. Cohen (1955) 1 QB 558

22.

A landlord, who had served on the tenant of a furnished room a notice to quit, which he had ignored, commenced an action to recover possession of the premises and obtained judgement against the defendant in default of appearance. The tenant continued to occupy the premises and the landlord, without calling in the help of the sheriff, put the tenant’s chattels outside the premises and obtained possession. Harman J. held that, notwithstanding that the landlord had invoked the law and obtained judgement for possession, he had not lost his common law rights and was entitled in the circumstances, without calling on the services of the sheriff, to enter as he did. He had not caused the tenant to change his position in reliance on his call on the law.

Mitchell v. Ealing LBC (1979) QB 1

23.

The plaintiff, a squatter was evicted by bailiffs pursuant to a court order from a flat owned by the defendants who then agreed to store her furniture instead of leaving it out on the street. The goods were stored in a lock-up garage. The plaintiff gave her husband authority to collect her property and he made an appointment with the defendants which they failed to keep. The goods were then stolen. The plaintiff brought an action against the defendants as bailee for the return of her property or its value alleging that they had failed to take reasonable care. O’Connor J. held that the defendants, as gratuitous bailees, were under a duty to take reasonable care of the plaintiff’s goods and to deliver them up when an unequivocal demand was made by the plaintiff for their return. Although the defendants had taken reasonable care in the storage of the goods and had properly arranged to return them they had negligently failed to do so and thereafter held the goods at their peril and became insurers of them.

Jones v. Gospel (1998) EGCS 108 (1998) 76 P & C.R.D. 43

24.

Court of Appeal held that the owner of land taking peaceable possession was entitled to remove trespassing goods left by the former occupier and such removal did not constitute a trespass to those goods. In this case, following the termination of an occupation agreement, the owner of a caravan and chalet site had removed (and later sold a chalet). A claim for conversion and trespass was rejected. Beldam LJ said:

‘To place or leave a chattel on the land of another without consent is a trespass and the owner of the land is entitled, taking reasonable care in the circumstances, to remove the offending chattel. In my view, the actions of Mr. Jones in the present case, so far from being an unlawful interference with Mr. White’s chattel, were done lawfully in pursuance of his legal right to recover possession of plot no. 13 and to remove from it a chattel which had no longer any right to remain upon the plot….. I can see no basis for such a claim and would echo the observations of Scrutton LJ in Hemmings v. Stoke Poges Golf Club [1920 1 KB 720] at 747 where he said: “But I see no reason to add to the existing privileges of trespassers on property which does not belong to them by allowing them to recover damages against the true owner entitled to possession who uses a reasonable amount of force to turn them out…” or, as I would say in the circumstances of the present case, who reasonable exercises his lawful right to recover possession of his land.’

Index

Jerry Juhan Developments SA v. Avon Tyres Ltd (1999) WL 1457293

25.

Court of Appeal held that where a bailor had failed to reclaim the bailed property within a reasonable period after the end of the contract of bailment, the bailee's liability was limited to damage occasioned by any lack of reasonable skill and care exercised by it during that period. In that case, the bailor’s failure to collect the goods within a period of 6 months relieved the bailee of its obligations.

Kavaljit Kaur Toor v. Sahdev Kumar Bassi (20 January 1999) EWCA Civ 612

26.

Court of Appeal held that a gratuitous bailee was under a duty to take reasonable care of a claimant’s goods and to deliver them up when a demand was made by the claimant for their return and if the defendant bailee failed to return them through inaction or indifference he thereafter held the goods at his peril and became the insurer of them.

Scotland v. Solomon (2002) EWHC 1886 (Ch)

27.

There was no basis for striking out a claim that the defendants had wrongfully interfered with the claimants' goods in the process of executing a charging order.

This was the defendants' appeal from a decision of Master Moncaster given on 26 February 2002 by which he dismissed their application to strike out the claim, and for summary judgment against the claimants ('the Scotlands') on the ground that the claim had no realistic prospect of success.

The defendants ('the Solomons') executed a charging order that they had obtained over the Scotlands' home in respect of unpaid costs. By this action the Scotlands contended that, in the course of executing that order, the Solomons had unlawfully seized, detained and disposed of certain goods and possessions belonging to the Scotlands by including them in the sale of the property to a third party after the bailiff had refused the Scotlands access to the property in order to remove them.

The Master concluded that: (a) the duties of a person enforcing a charging order were akin to those of a mortgagee in possession, such that the Solomons had no right or title to dispose of goods in the property; and (b) although the Scotlands had grossly exaggerated the value of the items in question, it could not be said that they were of no value at all, in which circumstance there was no justification for striking out the claim. By their appeal the Solomons contended that: (i) they had been entitled to dispose of the goods because the Scotlands were in breach of their duty to give vacant possession by failing to take the goods with them; and (ii) this was a case of involuntary bailment in which the Solomons had done all that was reasonable.

David Kitchen QC sitting as a Deputy High Court Judge held that: (1) The presence of the goods in the property was a breach of the Scotlands' duty to give vacant possession, but it did not follow that the Solomons were consequently under no obligation in relation to them. The Scotlands had at least an arguable claim that the Solomons had become involuntary or gratuitous bailees of the goods through an assumption of control over them. (2) It was not possible at this stage for the court to be satisfied that the Scotlands had no real prospect of establishing that the Scotlands had acted unreasonably. That issue would have to go to trial.

In the course of his judgement, the learned judge referred to:

‘The obligations of an involuntary bailee were explained by Hawke J in Elvin and Powell Ltd v. Plummers Roddis Ltd (1933) 50 TLR 158. If persons are involuntary bailees and have done everything reasonable they are not liable to pay damages if something which they do results in the loss of the property. There is an obligation on the part of involuntary bailees to do what is right and reasonable. I believe that I therefore have to decide whether there is an issue to go to trial on the question of whether the Solomons did everything reasonable with regard to the goods left… by the Scotlands.’

Index

Goods behind - the legal framework - statute

28.

Section 12 of The Torts (Interference with Goods) Act 1977 provides as follows:

12.

Bailee’s power of sale.

(1)

This section applies to goods in the possession or under the control of a bailee where—

(a)

the bailor is in breach of an obligation to take delivery of the goods or, if the terms of the bailment so provide, to give directions as to their delivery, or

(b)

the bailee could impose such an obligation by giving notice to the bailor, but is unable to trace or communicate with the bailor, or

(c)

the bailee can reasonably expect to be relieved of any duty to safeguard the goods on giving notice to the bailor, but is unable to trace or communicate with the bailor.

(2)

In the cases of Part I of Schedule 1 to this Act a bailee may, for the purposes of subsection (1), impose an obligation on the bailor to take delivery of the goods, or as the case may be to give directions as to their delivery, and in those cases the said Part I sets out the method of notification.

(3)

If the bailee—

(a)

has in accordance with Part II of Schedule 1 to this Act given notice to the bailor of his intention to sell the goods under this subsection, or

(b)

has failed to trace or communicate with the bailor with a view to giving him such a notice, after having taken reasonable steps for the purpose,

and is reasonably satisfied that the bailor owns the goods, he shall be entitled, as against the bailor, to sell the goods.

(4)

Where subsection (3) applies but the bailor did not in fact own the goods, a sale under this section, or under section 13, shall not give a good title as against the owner, or as against a person claiming under the owner.

(5)

A bailee exercising his powers under subsection (3) shall be liable to account to the bailor for the proceeds of sale, less any costs of sale, and—

(a)

the account shall be taken on the footing that the bailee should have adopted the best method of sale reasonably available in the circumstances, and

(b)

where subsection (3)(a) applies, any sum payable in respect of the goods by the bailor to the bailee which accrued due before the bailee gave notice of intention to sell the goods shall be deductible from the proceeds of sale.

(6)

A sale duly made under this section gives a good title to the purchaser as against the bailor.

(7)

In this section, section 13, and Schedule 1 to this Act,

(a)

“ bailor” and “ bailee” include their respective successors in title, and

(b)

references to what is payable, paid or due to the bailee in respect of the goods include references to what would be payable by the bailor to the bailee as a condition of delivery of the goods at the relevant time.

(8)

This section, and Schedule 1 to this Act, have effect subject to the terms of the bailment.

(9)

This section shall not apply where the goods were bailed before the commencement of this Act.

Index

29.

Section 13 of The Torts (Interference with Goods) Act 1977 provides as follows:

(13)

Sale authorised by the court

(1)

If a bailee of the goods to which section 12 applies satisfies the court that he is entitled to sell the goods under section 12, or that he would be so entitled if he had given any notice required in accordance with Schedule 1 to this Act, the court—

(a)

may authorise the sale of the goods subject to such terms and conditions, if any, as may be specified in the order, and

(b)

may authorise the bailee to deduct from the proceeds of sale any costs of sale and any amount due from the bailor to the bailee in respect of the goods, and

(c)

may direct the payment into court of the net proceeds of sale, less any amount deducted under paragraph (b), to be held to the credit of the bailor.

(2)

A decision of the court authorising a sale under this section shall, subject to any right of appeal, be conclusive, as against the bailor, of the bailee’s entitlement to sell the goods, and gives a good title to the purchaser as against the bailor.

(3)

In this section “ the court” means the High Court or a county court ….

A. Schedule 1 uncollected Goods

30.

Part I Power to Impose Obligation to Collect Goods

(1)

For the purposes of section 12(1) a bailee may, in the circumstances specified in this Part of this Schedule, by notice given to the bailor impose on him an obligation to take delivery of the goods.

(2)

The notice shall be in writing, and may be given either—

(a)

by delivering it to the bailor, or

(b)

by leaving it at his proper address, or

(c)

by post.

(3)

The notice shall—

(a)

specify the name and address of the bailee, and give sufficient particulars of the goods and the address or place where they are held, and

(b)

state that the goods are ready for delivery to the bailor, or where combined with a notice terminating the contract of bailment, will be ready for delivery when the contract is terminated, and

(c)

specify the amount, if any, which is payable by the bailor to the bailee in respect of the goods and which became due before the giving of the notice.

(4)

Where the notice is sent by post it may be combined with a notice under Part II of this Schedule if the notice is sent by post in a way complying with paragraph 6(4).

(5)

References in this Part of this Schedule to taking delivery of the goods include, where the terms of the bailment admit, references to giving directions as to their delivery.

(6)

This Part of this Schedule is without prejudice to the provisions of any contract requiring the bailor to take delivery of the goods.

Index

31.

Part II Notice of Intention to Sell Goods

(6)

(1)

A notice under section 12(3) shall—

(a)

specify the name and address of the bailee, and give sufficient particulars of the goods and the address or place where they are held, and

(b)

specify the date on or after which the bailee proposes to sell the goods, and

(c)

specify the amount, if any, which is payable by the bailor to the bailee in respect of the goods, and which became due before the giving of the notice.

(2)

The period between giving of the notice and the date specified in the notice as that on or after which the bailee proposes to exercise the power of sale shall be such as will afford the bailor a reasonable opportunity of taking delivery of the goods.

(3)

If any amount is payable in respect of the goods by the bailor to the bailee, and become due before giving of the notice, the said period shall be not less than three months.

(4)

The notice shall be in writing and shall be sent by post in a registered letter, or by the recorded delivery service.

(7)

(1)

The bailee shall not give a notice under section 12(3), or exercise his right to sell the goods pursuant to such a notice, at a time when he has notice that, because of a dispute concerning the goods, the bailor is questioning or refusing to pay all or any part of what the bailee claims to be due to him in respect of the goods.

(2)

This paragraph shall be left out of account in determining under section 13(1) whether a bailee of goods is entitled to sell the goods under section 12, or would be so entitled if he had given any notice required in accordance with this Schedule.

Supplemental

(8)

For the purposes of this Schedule, and of section 26 of the M1Interpretation Act 1889 in its application to this Schedule, the proper address of the person to whom a notice is to be given shall be—

(a)

in the case of a body corporate, a registered or principal office of the body corporate, and

(b)

in any other case, the last known address of the person.

Index

Goods left behind - practical advice

32.

Suggested practical advice:

Prior to the commencement of the lease, tenancy agreement or other agreement, the landlord should take full contact details for the proposed tenant (and if appropriate members of the tenant’s family or other available contact details). This could be done using a tenant screening service, solicitors correspondence or by direct request of the tenant.

Ensure that suitable provisions are expressly drafted in the lease, tenancy agreement or other agreement, to deal with the potential problems posed by goods left behind by the tenant (eg. if goods are left behind and not collected after say 7 or 14 days the landlord as agent for the tenant has authority from the tenant to dispose of or sell the goods as the landlord sees fit. Depending on the nature of the tenancy, premises and likely goods involved, alternative provision might be made for storage charges to be levied).

Where goods have been left behind by the tenant and there is no contractual provision to deal with the problem, the landlord will need to make a practical appraisal of the situation, depending on the nature of the premises / demise involved and the nature, size and value of the goods in question. It may be relevant to ask, whether the goods have been abandoned. This again turns on the nature, quality and value of the goods and significantly the circumstances in which the tenant left the premises. The landlord will need to exercise suitable caution before concluding that the goods have been abandoned.

If the landlord believes that the goods may not have been abandoned, the value of the goods then needs to be assessed and balanced against the cost of applying to the court for an order for sale or disposal bearing in mind the risk of possible proceedings by the tenant. It may be sensible for the landlord to take photographs of the goods. In the case of substantial, technical or valuable items left behind, where justified, it may be necessary to consider obtaining an independent valuation from an appropriately qualified professional.

If the landlord is unable to reasonably contact the tenant, and subject to the nature and value of the goods involved, the safest way for the landlord, to proceed to discharge his duties as a bailee of the goods, is to apply to the court for an order using the machinery under TIGA 1977. The landlord will need to ensure compliance with the detailed requirements for notices under Part I and Part II of Schedule 1 of TIGA 1977. In summary, the landlord should require the tenant to collect the goods. The landlord should further inform the tenant of his intention in default to sell the goods and deduct sale costs and storage costs from the proceeds of sale. Once the goods have been sold the landlord should pay the proceeds into court and levy execution against that fund.

Surinder Bhakar