Relief from forfeiture: consider timings for relief applications

The facts

This matter relates to Mentmore Golf Course (“the Golf Course”). Mentmore Greenland Limited (“Greenland”) held a long lease over the Golf Course, and Mentmore Golf Investments Limited (“Investments”) had the benefit of a charge over the leasehold interest.

There was lengthy and complicated litigation regarding the forfeiture of the lease, and those proceedings concluded with the landlord, Mr Gaymer, obtaining a possession order on 13 December 2023. Investments received a copy of the possession proceedings from an early stage, and it was aware of the ongoing dispute between Mr Gaymer and Greenland. 

After the possession order was made, but notably before it had been executed, both Greenland and Investments (as mortgagee) issued claims seeking relief from forfeiture. Neither party made an application to set aside the possession order.

After the claims for relief had been issued, Mr Gaymer instructed High Court Enforcement Officers to execute the possession order and take back possession of the Golf Course. Mr Gaymer sought to strike out / obtain summary judgment in respect of the claim for relief by Investments, which was granted by the HHJ Murch sitting in the County Court at Luton.  Investments appealed the decision.

The decision

The High Court held that Investments made its application in time (under Section 146 of the Law of Property Act 1925) because it was made after the possession order was made but before it was executed. As Investments made its application in time, it did not need to create a separate application to set aside the possession order. This, however, would be a factor in the overall consideration of whether to grant relief.

There was no requirement for Investments (as the mortgagee) to make an application in the original possession proceedings brought by Mr Gaymer, and it could bring its own claim for relief from forfeiture.

This decision will widen the scope for tenants to obtain relief from forfeiture and extend the time for making an application. The original forfeiture proceedings began several years before this case. However, Investments were still judged to have made the application in time because the possession order had not yet been executed.

Despite winning on this point, Investments’ appeal was ultimately unsuccessful, and the application for relief was struck out on the basis that there was an abuse of process. In this case, both Greenland and Investments had the same (or similar) beneficial ownerships and Investments was aware of the forfeiture claim from an early stage. The judge held that the application for relief was to prolong litigation, so the claim should be struck out.

How we can help

In forfeiture cases, timing will be vital for both landlords and tenants. If a landlord obtains a possession order, simply having the order will not be a bar to the tenant claiming relief from forfeiture. The matter will depend on whether the possession order has been executed (i.e. taking back possession). This may affect the landlord’s ability to re-let a property, and the eviction process should be followed through to its conclusion.

Importantly, this case was found to be an abuse of process, demonstrating that even when a tenant applies for relief in a timely manner, the court will still consider all the facts of the case. This is important for both tenants and mortgagees seeking relief – a reminder that the court ultimately has the discretion to do so.

If you are considering forfeiture or an application for relief, please do not hesitate to get in contact with the Property Disputes team here at Greenwoods.