A recent departure from reality by the Court of Appeal could leave tenants paying over the odds when it comes to rent reviews.
In Beegas Nominees Ltd v Decco Ltd [2003] EWHC 1891 (Ch); [2003] 43 EG 138, a dispute arose over the lease of a warehouse in the largely undeveloped Stone Business Park. The rent review clause required the valuer to take account of evidence of the rental value of premises within a five-mile radius of Tamworth or Minworth as if they were situated in Stone. The landlord argued that, by this clause, such evidence could not be discounted to reflect the fact that the comparable premises were situated in a location that attracted higher rents. The tenant, on the other hand, contended that this was contrary to the presumption of reality.
And the court’s ruling? Reality can be manipulated. For a full discussion, see Sandi Murdoch’s legal note
A recent departure from reality by the Court of Appeal could leave tenants paying over the odds when it comes to rent reviews.
In Beegas Nominees Ltd v Decco Ltd [2003] EWHC 1891 (Ch); [2003] 43 EG 138, a dispute arose over the lease of a warehouse in the largely undeveloped Stone Business Park. The rent review clause required the valuer to take account of evidence of the rental value of premises within a five-mile radius of Tamworth or Minworth as if they were situated in Stone. The landlord argued that, by this clause, such evidence could not be discounted to reflect the fact that the comparable premises were situated in a location that attracted higher rents. The tenant, on the other hand, contended that this was contrary to the presumption of reality.
And the court’s ruling? Reality can be manipulated. For a full discussion, see Sandi Murdoch’s legal note Through the looking glass Estates Gazette 25 October 2003, p135.
