Relief from Forfeiture: Court of Appeal considers judgment where a tenant was protected (Keshwala and another v Bhalsod and another – 2021)

Update: The Court of Appeal considers a further appeal by the landlord in this case. Our report on the High Court’s judgment contains more detail on the background of the case and the earlier decisions.

The background

In Keshwala and another v Bhalsod and another [2021], the High Court had previously allowed an appeal by tenants, finding that a delay of 5 months in making an application for relief from forfeiture did not prevent the tenants claiming relief and that the landlords had not demonstrated ‘exceptional circumstances’ such that the application should be refused.

The tenant had made its application within the statutory 6 month period and had therefore been made with ‘reasonable promptitude’. The landlord appealed.

The decision

The Court of Appeal allowed the appeal in favour of the landlord, overturning the High Court’s decision.

In its judgment, the Court referenced s.139(2) County Courts Act 1984 which gives a tenant 6 months to apply for relief from forfeiture in the County Court. The High Court had referred to ‘reasonable promptitude’ in its finding that the tenant had made its application within time and without undue delay. The Court of Appeal found that this phrase had its origins in High Court cases, and that in the context of the High Court the 6 month time limit should be given regard but is not considered a strict time limit.

Earlier cases had concluded that tenants applying for relief from forfeiture near to, or at the end of, the 6 month period had not made their applications promptly, and the Court of Appeal supported this, finding an absence of any legal principle which stated that applications made within 6 months were made promptly.

Advice and action for landlords

The Court of Appeal’s decision will provide some reassurance for landlords, placing the importance on tenants to make applications for relief, whether in the High Court or the County Court, from forfeiture promptly.

Landlords will be able to market and relet properties during the 6-month period following forfeiture, avoiding the need to wait for the 6 month period to elapse in case a tenant makes a later application. This was a point from the High Court decision which raised concerns from landlords, who potentially would have properties vacant for months unnecessarily.