Corporate Body Landlord Notices… who signs?
Posted Wednesday 23 December 2020 - 13:14pm by Trust Audit
S.44 Companies Act 2006 sets out that a limited
company may execute a document either by affixing its common seal to that
document, or else by a director of the company signing the document in the
presence of a witness or by two “authorised signatories” – which is defined to
mean any director and the company secretary.
In Hilmi & Associates v 20 Pembridge
Villas Freehold Ltd, the Court of Appeal held that, where a landlord was
required to sign a document for some “formal legal purpose” and was a corporate
entity, then this engaged the provisions of s.44 of the Companies Act 2006.
In Northwood v Fearn & Cooke, the tenant fell
into rent arrears and was served a s.8 Housing Act 1988 notice seeking
possession. The notice was in the correct form and was signed by a
property manager employed by the landlord. The tenant defended the claim for
possession, arguing that the notice was invalid as the landlord was a
corporate body and as the notice being required for a formal legal purpose, should
have been executed in accordance with the Companies Act 2006.
The tenant brought a counterclaim for a penalty
award under s.214(4) Housing Act 2004 on the grounds that the prescribed form
for the provision of prescribed information about the security deposit demanded
a signature by the landlord, had only been signed by one director of the
landlord company, without a witness.
Principles from the Appeal judgment:
requirement for a corporate landlord to execute a document only applies where
the relevant statutory provision requires the landlord and only the landlord to
sign. Section 8 notices may be signed by the landlord or an agent, so there is
no requirement for execution.
confirmatory certificate was (at the relevant time) required to be signed by
the landlord alone and consequently the trial judge was correct to hold that it
was not valid.
26 March 2015 a landlord’s agent or the landlord themselves can sign the
Confirmatory Certificate. Therefore the decision on the cross-appeal is only
relevant to prescribed information given before that date.
lettings agencies set up as corporate entities sign such documents, must they
execute them? This might be an issue for another case. In the meantime, concerned
agencies might wish to ensure their contracts list a named individual as the
agent, rather than the employer company.
21 notices. It is considered that, because the prescribed form (form 6A)
permits either a landlord or agent to sign, the requirement for execution will
landlords and lettings agencies which act on their behalf should check all
prescribed information documents given before 26 March 2015. Where they have
not been executed in accordance with s.44 Companies Act 2006, new versions
should now be given to the tenant as failure to do so would render any
subsequent notice under s.21 Housing Act 1988 invalid.
See Lyon Chambers news page for full article.