IT IS NO PART OF THE COURT OF CONSTRUCTION TO IMPROVE A DOCUMENT

HARRY FITZHUGH v ANTHONY FITZHUGH EWCA Civ 694

The Claimant and Defendant were brothers. They were joint administrators of their father’s estate. This consisted of a farm and land. Anthony and his partner were granted a licence to graze cattle, cultivate, mow fields and collect grass from the land. This was subject to an annual licence fee of £1.

As administrators the brothers were jointly the Licensor for the purpose of granting this licence to the Licensee. The Licensee was in breach of the licence for failing to pay the £1 for several years.
The Licence provided for termination of the licence agreement in the event of grave or persistent breaches, notice having been given. Notice was served by the Licensor but only by Harry. Not surprisingly Anthony was not party to a notice served on himself to terminate his own licence.

The question was whether the notice served by only one of the Licensors was a valid notice. At first instance the Judge said that it was. His decision was that in order to give proper interpretation to the Licence agreement the definition of Licensor for this purpose should exclude anyone who for the time being was also a Licensee. He observed that it was not appropriate that an individual should be able to profit from his own breach. He relied on the obiter observations of Slade LJ in Featherstone and Others v Staples and Others [1986] 1 WLR 861 where 4 plaintiffs were trustees of a will and owned land which they let under 3 tenancies to 3 partners as tenants. One of the tenants was a company wholly owned by the landlords. The issue was as to the validity of counter-notices served by only 2 tenants. Slade LJ opined that there would be strong grounds for construing that where the landlord himself is one of the tenants the definition of tenant in other parts of the agreement should be construed as excluding the tenant who was also the landlord.

On appeal the Judge’s ruling was set aside. The Court of Appeal were firmly of the view that there was no need to construe the licence agreement which was “short, simple and professionally drawn” to mean something different from what it said. It was not the case that there was no remedy available to Harry. He could apply to Court if necessary for Anthony to be removed as a Licensor and then serve a valid notice himself.