White v 29 Buckland Crescent Management Company Ltd ([2025] EWCA Civ 814)
New Principle: Where a settlement agreement contains a broad mutual release and a narrowly drafted carve-out, the landlord is precluded from bringing forfeiture proceedings founded on pre-settlement lease breaches unless the lease itself expressly preserves that remedy.

1. Introduction

29 Buckland Crescent is a Victorian building in London that has been converted into four flats. The freehold is owned by 29 Buckland Crescent Management Company Ltd (“the Company”). Mr White holds a 999-year lease of Flat 2 (the top-floor flat). Persistent leaks emanating from Mr White’s bathroom into the flat below triggered a series of legal skirmishes:

• Three applications were lodged by the Company in the First-tier Tribunal (Property Chamber) (“FTT”) in May 2021 – for a determination of breach under s.168 of the Commonhold and Leasehold Reform Act 2002 (“CLRA 2002”), and for outstanding service and administration charges.
• All proceedings were compromised by a Settlement Agreement dated 5 December 2021.
• Mr White failed to complete the specified remedial works by 28 January 2022. The Company then issued a draft s.146 notice and ultimately commenced forfeiture proceedings.
• HHJ Dight CBE (Central London County Court) held that the forfeiture claim was barred by the Settlement Agreement. On appeal, Richards J reversed that decision. The Court of Appeal (“CA”) has now restored HHJ Dight’s view.

The CA judgment, although ostensibly about costs, clarifies a point of recurring practical importance in landlord–tenant law: can a landlord revive the nuclear remedy of forfeiture after signing a settlement agreement that contains an all-embracing release?

2. Summary of the Judgment

Nicola Davies LJ (with whom Nugee LJ and Cobb J agreed) allowed Mr White’s appeal and held:

1. Clauses 6 (“Release”) and 7.1 (“Agreement not to sue”) of the Settlement Agreement extinguished or barred any claim—whether known or unknown—connected with the original FTT proceedings.
2. The carve-out in clause 7.2 (“shall not apply to any claims in respect of any breach of this agreement”) preserves only causes of action for breach of the Settlement Agreement itself, not breaches of the underlying lease.
3. The forfeiture clause in the lease was confined to breaches “herein contained”; therefore, breach of the Settlement Agreement—an external contract—could not trigger forfeiture.
4. Accordingly, the Company’s post-settlement forfeiture proceedings, which rested on the original repairing covenant (clause 3(1) of the lease), were contractually barred. Relief against forfeiture, costs orders, and all related steps taken in the High Court below therefore fell away.

3. Detailed Analysis

3.1 Precedents Cited and Their Influence

• BCCI v Ali [2001] UKHL 8 – Confirmed that ordinary principles of contractual interpretation apply to releases; broad words mean what they say unless commercial absurdity requires otherwise.
• FCA v Arch Insurance [2020] EWHC 2448 (Comm) – Emphasised that contracts must be construed against the full legal background (“matrix of fact” and law).
• Croft v Lumley (1858) 6 HL Cas 672 – Illustrated the courts’ historic strictness in construing forfeiture clauses; the trigger event must fall clearly within the clause’s wording.
• Bedford v Paragon Asra [2021] UKUT 266 – Clarified that a s.168 determination may serve purposes other than forfeiture (injunction or damages), highlighting why parties may seek such determinations pre-emptively.
• Eastpoint Block A RTM Co Ltd v Otubaga [2023] EWCA Civ 879 – Confirmed that s.168(4) applications are discrete steps, not themselves forfeiture actions, reinforcing the CA’s reasoning that the Settlement Agreement’s context included alternative remedies.

3.2 The Court’s Legal Reasoning

1. Construction of the Settlement Agreement
   The CA applied orthodox interpretative principles. Clause 6’s sweeping release covered “all claims … arising out of or connected with” the FTT proceedings. The phrase “connected with” extends beyond identical causes of action to those sharing the same factual substratum (the bathroom leaks).
2. Narrow Scope of the Clause 7.2 Carve-Out
   The carve-out is expressly limited to “claims in respect of any breach of this agreement.” The Company’s claim pleaded a breach of the lease, not the Settlement Agreement. Therefore, it lay squarely outside the carve-out.
3. Forfeiture Clause’s Reach
   The lease’s re-entry proviso allowed forfeiture only for breaches “herein contained.” Because the Settlement Agreement is extraneous to the lease, any breach thereof could not trigger forfeiture.
4. Statutory Context
   a) s.168 CLRA 2002 prohibits service of a s.146 notice unless breach is admitted or determined.
   b) The Leasehold Property (Repairs) Act 1938 imposes additional hurdles for forfeiture in long leases. The CA held that the parties, being assumed to know the 1938 Act, could not sensibly have agreed that forfeiture was an assured remedy.
   The legal backdrop thus favoured an interpretation that the landlord had traded potential forfeiture rights for the certainty of the Settlement Agreement’s terms (works deadline + large payment + indemnity costs).

3.3 Impact on Future Cases

This decision carries several practical implications:

• Drafting of settlements: Landlords (and tenants) must draft carve-outs with precision if they intend to preserve specific remedies (e.g., forfeiture). Use explicit language: “Nothing in this agreement shall prejudice the Landlord’s right to forfeit the lease for the admitted breach …”
• Forfeiture strategy: Reliance on a generic “breach admitted” clause is unsafe when combined with a broad release clause. Practitioners should cross-check the interplay between lease forfeiture triggers and the settlement contract.
• Section 168 applications: The judgment reinforces that such applications can function as leverage without guaranteeing forfeiture. Parties should consider whether alternative remedies (injunction, damages) meet their commercial aims.
• Repairing covenants in long leases: The Leasehold Property (Repairs) Act 1938 continues to present formidable obstacles to forfeiture. The CA’s reminder will likely revive attention to this under-used but potent statute.

4. Complex Concepts Simplified

s.146 Notice

A formal notice served by a landlord as a precondition to forfeiting a lease. It specifies the breach and allows the tenant time to remedy it.

s.168 CLRA 2002

Prohibits service of a s.146 notice for residential long leases until breach is either admitted by the tenant or determined by a court/tribunal.

Leasehold Property (Repairs) Act 1938

An Act protecting tenants of long leases from forfeiture/damages for repairing covenants unless strict conditions are met. Tenants can serve a counter-notice forcing the landlord to obtain court leave.

Release Clause

A contractual provision by which parties give up (release) present and future claims arising from specified circumstances.

Carve-Out

An exception to a release clause that preserves certain claims or remedies.

Forfeiture

The landlord’s right to bring a lease to an early end following certain tenant breaches. Often described as the landlord’s “nuclear” option.

Relief against Forfeiture

The equitable jurisdiction enabling courts to reinstate the lease on terms (commonly payment of arrears/costs) if justice requires.

5. Conclusion

The Court of Appeal’s decision in White v 29 Buckland Crescent Management Company Ltd establishes a clear rule: a general mutual release, combined with a narrow contractual carve-out, prevents a landlord from resurrecting pre-settlement lease breaches as grounds for forfeiture unless the settlement expressly reserves that right and the lease’s re-entry clause accommodates it.

The ruling underscores three broader lessons:

1. Settlement agreements must be read against their statutory and contractual matrix; unarticulated assumptions about future remedies are unsafe.
2. Forfeiture clauses are strictly construed; their reach does not extend beyond the four corners of the lease.
3. The 1938 Act remains an influential—often decisive—shield for tenants of valuable long leases against forfeiture for repairing breaches.

Landlords, tenants, and their advisers should therefore draft with surgical precision, explicitly preserving—or relinquishing—remedies, lest an expensive round of litigation be required to discover what their agreement already (did or did not) say.