Property developer Berkeley Homes plc is facing a £127,000 lawsuit for failing to complete the redevelopment of seven central London luxury apartments in an adequate manner.
Restaurateur George Stavrinou claims that, in its refurbishment of the building in Dover Street, W1, the developer had used substandard materials and had failed to comply with building regulations.
He maintains that, as a result, he was unable to rent out five of the apartments while remedial works were being carried out.
The building, owned by third claimant, Dover Street Investments Ltd, of which Stavrinou is a director and majority shareholder, comprises Stavrinou’s wine bar and restaurant in the basement, a licensed betting shop on the ground floor, and residential accommodation on the first to fourth floors.
Stavrinou contends that, in July 1997, Berkeley Homes (Surrey) Ltd, a subsidiary of the second defendant, agreed with the then owner to carry out the development works and to enter into a long lease of parts of the building.
After Stavrinou’s restaurant company purchased the freehold of the building in 1999, he and his companies allegedly obtained long leasehold interests in five of the apartments, costing between £490,000 for a first-floor flat and £1.17m for the penthouse, with the intention of reletting.
However, Stavrinou claims that Berkeley Homes did not complete the refurbishment in an acceptable and workmanlike manner, and had not complied with building regulations.
He also contends that the developer did not use good quality materials and had failed to ensure that the flats were suitable for occupation.
In March 2002, Berkeley Homes allegedly commissioned a surveyor’s report into defects within the building, and agreed to carry out the necessary remedial works.
Stavrinou and his co-claimants are now arguing that, because of the defects and the defendants’ failure to complete the remedial works until September 2002, they have incurred considerable expense and have suffered loss and damage.
The claimants are seeking £71,628 for loss of rent during the relevant periods, on the basis that the flats could have been let at rents ranging from £800 to £1,600 per week, together with £30,000 for expenses and interest of £24,949.91.
Stavrinou and others v Berkeley Homes (Surrey) Ltd and another Queen’s Bench Division 18 May 2004.
References: EGi Legal News 2/6/04
