In an economic downturn landlords frequently get premises back more quickly than anticipated and often in a less than desirable state. A landlord may forfeit a lease for non-payment of rent; alternatively, the tenant may choose to walk away because it can no longer pay the rent. Often this means that when the landlord takes back possession, the premises are full of the former tenant's goods. Although tempting, a landlord cannot simply throw the goods away.
This issue came before the High Court recently in the case of Robot Arenas Limited -v- Waterfield and Others. Robot Arenas had purchased the arena that had been used to film the television series "Robot Wars". It was proposing to use it for a world championship version of the show but this event was cancelled due to poor sales. Robot Arenas had the equipment in storage at an RAF base in Newton, Nottinghamshire and failed to collect the goods. The property owner defendant threw them away when clearing out the building. Robot Arenas claimed damages.
The court ruled that an involuntary bailee – someone who finds himself unintentionally in possession of another's property – cannot simply throw goods away. Although the law is unsatisfactory – indeed the court went so far as to call it a "blot on the law" - there is a statutory procedure to follow.
If the goods have been abandoned by the true owner, they may be disposed of. But in order to establish abandonment it was necessary to prove that the owner not only intended to abandon the goods but had actually done some physical act to relinquish ownership. However, if there is no clear act of abandonment then disposal would be unlawful unless the proper procedure has been followed. This procedure is laid down in the Torts (Interference with Goods) Act 1977. A notice is given to the owner and the goods can be sold if they are not collected within a reasonable period of time. In the meantime, reasonable care has to be taken of them. Any proceeds of sale have to be accounted for.
In this case, although, the goods had not been intentionally abandoned, the court was satisfied that the property owner had made reasonable enquiries about the ownership of the goods and that it had been entitled to believe no-one had claimed them.
This is a tricky and often frustrating area for property owners who cannot simply throw away goods left behind.
The Law: Robot Arenas Limited –v- Waterfield & Others [2010] All ER 67, [2010] EWHC 115
This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to www.law-now.com/law-now/mondaq
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The original publication date for this article was 11/02/2010.