Relief from Forfeiture: A recent High Court decision serves as reminder of key principles

The case of Sik v Malik [2025] EWHC 383 (Ch) is a decision of the High Court on appeal from the County Court. This case has served as a useful reminder of the considerations the Court will have regard to in cases of relief from forfeiture.

Background facts

The Claimant landlord (Mr Sik) was the owner of property at Ground Floor and Basement, 201 Mile End Road, London (“the Premises”). The Respondent tenant (Mr Malik) was the tenant under a lease for 25 years.

On 23 December 2021, Mr Sik served on Mr Malik a notice to terminate the Lease under Section 25 Landlord and Tenant Act 1954, giving 25 June 2022 as the date for termination, and stating that Mr Sik would oppose an application to the Court for the grant of a new tenancy on the ground contained in Section 30(1)(f) Landlord and Tenant Act 1954 (i.e. that on the termination of the Lease, Mr Sik intended to carry out substantial works of construction at the Property which could not reasonably be done without obtaining possession).

On 26 May 2022, Mr Malik applied for a new tenancy pursuant to Section 24 Landlord and Tenant Act 1954. This claim had the effect of continuing the terms of the existing Lease pending determination by the Court.

In the meantime and by the end of August 2023, whilst the renewal application proceeded in Court, Mr Malik fell into arrears in respect of part of the March 2023 and June 2023 quarters. Mr Sik forfeited the Lease by peaceable re-entry on 30 August 2023.

On 7 September 2023, Mr Malik served an application for relief from forfeiture. His solicitors attempted to revise this to include a defence that Mr Sik had waived his ability to forfeit as a result of his counsel’s skeleton argument served in respect of a hearing on 22 August 2023 and after the accrual of the arrears. The Claim Form was finally issued on 15 February 2024.

County Court

The County Court Judge granted relief from forfeiture to the Respondent tenant (Mr Malik) following a peaceable re-entry of demised property by the Claimant landlord (Mr Malik) on grounds of non-payment of rent, on condition that the tenant should pay:

• Full rent arrears plus interest to the date of the peaceable re-entry; and
• Half of the rent plus interest from the date of peaceable re-entry to the date on which possession was regained

At the heart of the appeal was the question of whether the Judge exercised his discretion correctly to require a payment of only 50% of the rent arrears since the date of re-entry as a condition of relief.

High Court

The landlord appealed to the High Court. The High Court found that the relief conditions imposed by the County Court Judge were wrong in law and the Judge did not have a discretion to reduce the rent to 50% as a condition of relief from forfeiture between peaceable re-entry and the grant of relief from forfeiture.

The only order the Court could make, due to statutory rules, was to award relief from forfeiture upon:

• payment of the entire rent from the date of peaceable re-entry to the date of relief (with account being taken to any sums that Mr Malik had attempted to pay);
• Payment by Mr Malik of interest on that rent (subject to the account referred to above); and
• Payment by Mr Malik of the costs of peaceable re-entry together with the reasonable costs incurred in the forfeiture proceedings.

Key takeaways

• It is common to seek to defend a possession claim arising from forfeiture as well as seeking relief in the alternative. Tenants should be careful to avoid running hopeless points in defence that simply lead to an increase in the costs they have to pay. There are occasions where it is more sensible simply to concentrate on a relief application and not contaminate the credibility and increase the cost of this with a bad defence.
• The terms of relief, if granted, will often include payment of the arrears which gave rise to the right to re-enter the premises plus payment of the costs of the proceedings (usually on an indemnity basis).
• Relief from forfeiture can only be granted by the Court - only the Court has the power to “resurrect” the original Lease by granting relief from forfeiture for unpaid rent under sections 138 and 139 County Courts Act 1984. If the parties agreed relief from forfeiture between themselves (without obtaining a Court Order), this would not have the effect of resurrecting the original Lease. Instead, a new tenancy would be created.
• A tenant can apply for relief from forfeiture as soon as the landlord is proceeding with the forfeiture. A landlord will be proceeding with the forfeiture as soon as a section 146 notice has been served, if a section 146 notice is necessary (which it was not in this case because forfeiture was based upon unpaid rent).
• The process for claiming relief from forfeiture varies depending on the nature of the breach. If the breach in question relates to rent arrears, where the application is dealt with in the:
  County Court: If the forfeiture is by court proceedings, the application must be made within 6 months of the date on which the Landlord recovers possession. If the forfeiture is by peaceable re-entry (i.e. changing the locks), the application must generally be made within 6 months of the date of the Landlord taking possession.
  High Court: If the forfeiture is by court proceedings, the application must be made within 6 months of execution of the judgment. If the forfeiture is by peaceable re-entry then there is no prescribed period within which an application for relief must be sought It should be noted however that relief will not be given in respect of “stale” claims and the Court is likely to adopt a similar time limit of 6 months from the forfeiture by peaceable re-entry.
• The landlord should consider the risk of an application by the tenant for “relief from forfeiture” being made before granting a new lease to a new tenant. It is therefore sensible to keep the old tenant informed of the landlord’s intentions as to the re-letting of the premises to encourage the Court against exercising its discretion to grant the old tenant relief.

Please do not hesitate to contact Andrew Ross or Harriet Durn, or your usual Charles Russell Speechlys contact if you have any queries.