Landlord loses tribunal appeal

A landlord who argued that a 12-month contract with managing agents could be terminated within the 12-month period has lost an appeal against an earlier tribunal decision.
 
The upper tribunal in Corvan (Properties) Ltd v Abdel-Mahmoud [2017] UKUT 0228 (LC), backed a first tier tribunal’s (FTT) ruling that the wording in the contract meant it was a qualifying long term agreement (QLTA).
 
The landlord entered into the contract with the managing agents and the term was stated in Clause 5 of the agreement which said: “The contract period will be for a period of one year from the date of signature hereof and will continue thereafter until terminated upon three months’ notice by either party.” 
 
An earlier FTT decision had ruled that the wording meant the agreement could not be terminated before the end of 15 months and was, therefore, a QLTA. 
 
However, the landlord challenged this decision and appealed to the Upper Tribunal. Deputy President, Martin Rodger QC, said he did not find the construction of Clause 5 easy but in the end concluded that the term was indeed for more than 12 months. 
 
He said it was reasonably clear that the agreement was intended to continue until after the end of the initial year and that it “will continue thereafter”. 
 
The Upper Tribunal decided that the management agreement, continuing “until terminated” rather than “unless terminated”, could not be terminated any earlier than after a period of at least a year and a day. 
 
It was, therefore, a QLTA, and the appeal was dismissed.
 

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