(d) 1 Davidson, Prec. Conv. 537, 624, 648 and n. (y), 4th ed.

(c) Stat. 44 & 45 Vict. c. 41, s. 3 (4).

(f) See Bull v. Hutchens, 32 Beav. 615; Lawrie v. Lees, 14 Ch. D. 249; 7 App. Cas. 19, 30 - 33, 37 - 39, 42.

Waiver of forfeiture by receipt of rent.

We have seen (m) that if a man buy land with notice, either oral or written but not contained in the contract for sale, that a good title cannot or will not be made.

Purchaser buying leaseholds with notice of a breach of the vendor is exonerated from showing title to the extent indicated by the notice, unless he should have expressly agreed by the contract for sale to show a good title. It follows, therefore, that if one buy leasehold land with notice so given to him that there has been a breach of covenant, which cannot or will not be remedied by the vendor, he is precluded, unless the contract contain an express stipulation that the vendor shall show a good title, from requiring the evidence, to which he would otherwise be entitled, that the covenant in question has been duly performed. Thus, where houses held under a repairing lease are obviously dilapidated and the purchaser agrees, outside of the written contract, to take them as they are, it is thought that he could not insist on the vendor furnishing evidence of his performance of the covenant to repair. The rule in question, though perfectly well established, was, however, unaccountably overlooked both by the vendor's counsel, by Swinfen Eady, J., and by the Court of Appeal in the case of Re Highett and Bird's Contract (n). In that case the purchaser bought under an open contract a leasehold house, which was obviously out of repair, and the vendor accepted a reduced price in consequence. Before the title was accepted, the vendor was served with a "dangerous structure" notice from the London County Council under the London Building Acts, 1894 and 1898, requiring him to pull down or render secure a part of the house. The notice not being complied with, a police court order was made requiring him to do the repairs within fourteen days. This order was made before, but not served on the vendor till after the acceptance of the title. The vendor, who had produced the receipt for the last quarter's rent (o), took out a vendor and purchaser summons for a declaration that he had shown a good title, and that the expense of complying with the police court order was an outgoing (p) which ought to he home by the purchaser. The vendor's counsel mainly contended that this expense had not ripened into a charge or liability until after the proper time for completion (p), and that under the Conveyancing Act, 1881 (q), production of the last receipt was conclusive evidence of performance of the covenant to repair. It was held (and in this respect, no doubt, rightly) that under the statutory stipulation such production is only evidence prima facie of performance of the covenant, and that the purchaser is not obliged to accept it as conclusive where he has notice of a breach of the covenant. It was, however, decided in both Courts that the vendor was under an obligation to prove that the covenant to repair had been performed, and was for this reason bound to defray the expense of complying with the notice and order; and the Courts declined to consider at what time this liability became a charge. But it is submitted that this decision cannot be supported on the ground so assigned for it. The Courts rested their judgment on the supposed authority of the case of Barnett v. Wheeler (r). That case, however, was an action of assumpsit by a purchaser, in which the declaration stated a sale of leaseholds on the express condition that the vendor should make a good title, and was argued on demurrer to a plea that the vendor made a good title in all respects except as to compliance with a covenant to repair, and that the purchaser knew that the property sold was out of repair. It was considered that the plea was bad, but Parke, B., particularly mentioned that there was an express contract to make a good title. This accords with the rule stated above (s). As already mentioned, this rule was not brought to the notice of either Court in Re Highett and Bird's Contract, nor were any of the authorities cited by which it is established. No doubt under an open contract for the sale of leaseholds, without more, the vendor is bound to prove that there is no liability to forfeiture by reason of the non-performance of a covenant to repair (t); and this may be the case notwithstanding that the property is obviously out of repair, for it may be contemplated that the vendor shall perform the covenant before completion (u). But where a vendor is induced to accept a lower price than he would otherwise take on account of the property being out of repair, it is submitted that the parties plainly intend to waive all objection to the title caused by the non-performance of a covenant to repair, and must be taken to have contracted on that footing. This view appears to have commended itself to Lord Justice Romer, who explained in a subsequent case (x), that Re Highett and Bird's Contract was decided on the footing that the vendor was in the same position as if he had expressly agreed to make a good title; and declared that that case was not to be taken as an authority for any case in which there is not an express contract by the vendor to make a good title. To avoid all question, however, of the application of the decision above criticised, a vendor selling houses held under a repairing lease should be most careful to stipulate expressly in the contract for sale that the purchaser shall be deemed to have notice of the actual state and condition of the property, and shall take the houses as they are. And a vendor of leaseholds should always employ an express stipulation, such as was generally used before the Conveyancing Act, making production of the last receipt for rent conclusive evidence of the performance of all covenants, and providing further, if necessary, that the person giving such receipt, though not the original lessor, shall he assumed to be the reversioner or his agent (y). In default of this last proviso, the vendor would have to prove that the giver of the receipt, if not the lessor, was the reversioner or his agent.