[2002] EWCA Civil 1830,16 December 2002. The Halifax Building Society re-possessed in 1995 on default of the mortgagee, a flat, whose freehold was owned by the appellant (X). X claimed right of forfeiture on the lease, serving a notice on Halifax under the Law of Property Act 1925 s146, who in turn served a counter-notice claiming benefit of the Leasehold Property (Repairs) Act 1938 s1(3). Respondent (Y) purchased the flat from Halifax at auction in June 1995, whereon X commenced possession proceedings on the basis of the previously served s146 notice. The court found against X because the mortgagee in possession of the premises was the lessee for the purpose of s146 of the 1925 Act and s1 of the 1938 Act and X could not commence proceedings to enforce s146 in respect of breaches to which the 1938 Act applied without the leave of the court. Costs were ordered against X who subsequently appealed. "Held", appeal allowed. Halifax had not been entitled to serve a counter-notice under the 1938 Act. The lessor was not obliged to serve the s146 notice on Y who had not taken assignment of the lease. Proceedings had not been instituted in breach of the 1938 Act s1 and costs should not have been decided in part on that basis. View judgment at www.courtservice.gov.uk