Leases often date back many years and inflation means that ground rents payable often dwindle to apparently trifling sums – however, they must still be paid. In one case that underlined the point, a subtenant came within an ace of forfeiting his long under-lease due to his failure to pay £11 in ground rent.
The subtenant had been served with a notice by his landlord requiring him to pay arrears of ground rent in respect of land he held under a 900-year under-lease. The under-lease dated from 1948 and set a ground rent of £2 per annum. When the tenant did not pay, the landlord entered the relevant land and secured it. The landlord claimed to have validly forfeited the under-lease by peaceful re-entry and, on the same day, applied to the Land Registry to cancel the under-lease.
After the tenant launched an appeal, the First-tier Tribunal (FTT) found that both the notice and the purported forfeiture were invalid. That was on the basis that the explanatory notes attached to the notice were non-compliant with Section 166 of the Commonhold and Leasehold Reform Act 2002. The notes were in an out-of-date form that Parliament had specifically decided should not be used. The landlord’s challenge to the FTT’s ruling was subsequently rejected by the Upper Tribunal.