Landlord and tenant — Covenant to keep in repair — Whether landlord in breach at any time when premises out of repair — Whether landlord in breach only after expiration of a reasonable time from having notice of disrepair
By an
underlease the defendant, as landlord, covenanted ‘to . . . keep in complete
good and substantial repair and condition the demised premises . . .’. By three
subunderleases, the terms of which were held by the plaintiff, the defendant,
as landlord, covenanted to perform the tenant’s covenants in the underlease. In
1986 part of the exterior brickwork became out of repair and the defendant
carried out the necessary work which commenced in 1988. The plaintiff contended
that the defendant was in breach of the covenants as soon as the premises were
out of repair; on behalf of the defendant it was said that no breach arose
until after the expiration of a reasonable time from receiving notice of the
disrepair.
in complete good and substantial repair’ referred to the state of the premises
and not the duty of repairing. Accordingly, the defendant was in breach as soon
as the premises fell into disrepair.
The following
cases are referred to in this report.
Bishop v Consolidated London Properties Ltd (1933) 102 LJKB 257; 148
LT 407
Loria v Hammer [1989] 2 EGLR 249
Lurcott v Wakely and Wheeler [1911] 1 KB 905, CA
Luxmore
v Robson (1818) 1 B&Ald 584
This was the
hearing of a preliminary issue in proceedings by the plaintiff, British Telecom
plc, against Sun Life Assurance Society plc.
Christopher
Nugee (instructed by Ashurst Morris Crisp) appeared for the plaintiff; Wayne
Clark (instructed by Church Adams Tatham & Co) represented the defendant.
Giving
judgment, ALDOUS J said: On June 11 1993, Master Moncaster ordered that
this preliminary issue be tried: whether, on the true construction of the
leases referred to in paras 1, 2(a), 5, 6(a) and 9 of the amended statement of
claim, the defendant’s obligation to repair the external walls and main structure
of the building, referred to in para 1 of the amended statement of claim, at
fifth-floor level: (1) was, or included an obligation to keep the said property
in repair at all times, such that the defendant was in breach of covenant, so
soon as the same ceased to be in a state of repair; or (2) of some other and,
if so, what obligation.
The relevant
facts for determination of that preliminary issue are not in dispute. At all
material times, the plaintiff was the tenant and the defendant its landlord, of
parts of a building known as Randolph House, Wellesley Road, Croydon, under
three subleases, to which I will refer as ‘the 1969 lease’, ‘the 1973 lease’
and ‘the 1976 lease.’
In 1986, part
of the exterior brickwork of the building at first-floor level became out of
repair. The defendant put in hand works to carry out the necessary remedial
work, which was commenced in February 1988. The plaintiff believes that the
repairs were not carried out as quickly as was proper, but that is not a
material matter for my decision.
The
plaintiff’s case is that the defendant was in breach of covenant as soon as the
brickwork became out of repair. If so, the plaintiff submits that it will be
entitled to such damages as it may prove, without the necessity of considering
whether the defendant proceeded to carry out the repairs with sufficient
promptness.
The
defendant’s submission is that it was not in breach of covenant, as its duty to
repair required it to carry out the repair in a reasonable time from when the
defect became apparent.
In the 1973
lease, the covenant on which the plaintiff relies is that contained in clause
5(b), whereby the defendant covenanted:
(b) To pay the rent reserved by and to observe
and perform the tenant’s covenants contained in the lease under which it holds
the building so far as the same are not required to be performed by the Lessee
under the covenants on its part hereinbefore contained and to indemnify the
Lessee against the same as far as aforesaid.
The lease
referred to in clause 5(b), under which the defendant held the building, was an
underlease dated June 24 1968, whereby the land and building was let by
Franthorne Investment Ltd to the defendant for a term expiring on June 1 2091.
I will call that lease ‘the Franthorne lease’. By clause 3(5) of the Franthorne
lease, the defendant covenanted as follows:
3. The Lessee
hereby covenants with the Lessors in the manner follow that is to say . . .
(5) from time to time and at all times during the
said term to uphold, maintain, cleanse and keep in complete good and
substantial repair and condition the demised premises and car parking
accommodation for the time being erected or built thereon and all the windows
(including the glass therein) doors, locks, fasteners, water closets, sinks,
cisterns, pipes, drains, roads, pass yards, central heating installation, lifts
and all Landlord’s fixtures and fittings and appurtenances thereunto belonging,
of whatsoever nature and including all party and other walls, boundary walls
and fences and drains belonging to the demised premises.
It follows
from that arrangement that Sun Alliance, the defendant, held the lease of the
whole building, with obligations to, inter alia, keep in good repair.
Sun Alliance covenanted with the plaintiff that it would comply with its
obligations under the headlease. It is accepted that the other leases contain
similar obligations, thus a decision based upon the 1973 lease will decide the
issue on the other leases. Therefore, it is not necessary for me to refer to
the other two leases.
The plaintiff
submitted that the defendant’s covenant in clause 5(b) of the 1973 lease was
not a mere covenant of indemnity, but was a covenant to perform the obligations
there referred to. That was accepted by the defendant. The defendant also
accepted that, so far as external walls and structure were concerned, the
defendant covenanted, in clause 5(b) of the 1973 lease, that it would comply
with the obligation in clause 3(5) of the Franthorne lease.
The dispute
between the parties concerns the true construction of the words ‘keep in
complete good and substantial repair and condition’. On behalf of the
plaintiff, it was submitted that those words imposed an obligation to at all
times keep the premises in repair, so that that obligation would be broken as
soon as the premises became out of repair. The defendant submitted that the
obligation was to repair when disrepair became evident.
Counsel for
the plaintiff submitted that the words ‘keep in complete good and substantial
repair’ referred to the state of the premises and not to the duty of repairing.
He submitted that there was a clear difference between a covenant to repair and
a covenant to keep in repair. The words ‘to keep in repair’ were used in
contrast to the words ‘to repair’, meaning to put into repair. He submitted
that the purpose of the covenant was not only to set out the obligations as to
which party should carry out the repairs but also to set out where the
liability should reside if the premises should for any reason fall into
disrepair.
I believe he
is right upon the meaning of those words and that his submission is supported
by authority. In Luxmore v Robson (1818) 1 B&Ald 584, the
court had to consider a lease which contained a covenant:
That the lessee
should and would well and sufficiently repair, and keep in proper repair, all
and singular the buildings, walls, fences, and hedges thereon standing and
being, or thereafter to be erected and made in and upon the said thereby
demised premises, or any part thereof, during the continuance of the term.
At p585, Lord
Ellenborough CJ said:
The common
sense, the practice, and the general inconvenience of mankind, require that a
construction different from that in the case cited should be adopted. By the terms
of the covenant the lessee is bound to keep the premises in repair; then to
keep them in repair he must have them in repair at all times during the term;
and if they are at any time out of repair, he is guilty of a breach of
covenant, which is the proper subject of an action.
Counsel for
the defendant sought to distinguish the present case from Luxmore v Robson.
He drew to my attention the submissions of counsel, which were that the
obligation to repair could be satisfied at any time during the term of the
lease. That, he submitted, was not the same as the submission made in this case
and therefore the judgment of Lord Ellenborough should not be read as decisive
of the present case. That is a distinction, but the Luxmore case is not
the only authority.
In Lurcott v
Wakely and Wheeler [1911] 1 KB 905, the covenant that was considered by
the Court of Appeal was that [at p906]:
. . . from
time to time during the said term at his and their own proper costs well and
substantially repair, paint, glaze, cleanse, and keep in thorough repair and
good condition all the said premises thereby demised, with the appurtenances
thereto belonging, and the said premises being so repaired and kept would at
the end or sooner determination of the term peaceably yield up to the lessors,
their heirs or assigns.
In that case,
the premises came into disrepair and, pursuant to a demolition order, a wall
was taken down. The defendant refused to pay the cost of demolition and
rebuilding. Fletcher Moulton LJ considered the words in the covenant and
concluded that they amounted to three separate covenants: namely a covenant to
repair, a
At p918, he said this about the covenant to keep in thorough repair:
Now I will go
to the second covenant, which is to keep in thorough repair. Here we get more
into the realm of previous decisions by reason of the fact that in some of them
it has been treated as a covenant the language of which pointed to the mode in
which or the means by which the covenantor is to perform his duty. They leave
it, however, a matter on which one is free to express one’s opinion, and
personally I think, that to keep in thorough repair does not in any way confine
the duty of the person who is liable under the covenant to the doing of what
are ordinarily called repairs. A house is spoken of as being in thorough repair
when it is a house to which no repairs have to be done. But it is a description
of a state and not a mode by which that state has been arrived at, and,
therefore, in my own mind I draw no wide distinction between keeping in
thorough repair and keeping in good condition; they both appear to me to
describe the condition of the house. What a surveyor would call in good
condition and what a surveyor would call in thorough repair may differ
somewhat, but they would be something very like, the one to the other. As I
have said, the legal obligation is to keep the house in that state, and I
confess that I do not think that from the legal point of view there is much
difference between the nature of the two obligations.
He went on to
consider the third covenant and said:
I come now to
the third covenant, which is to repair. Here there is a duty to perform an
operation. No doubt, if you thoroughly repair, it will put the house in a good
condition and in a state of thorough repair. But it is plain that the word
‘repair’ refers to the operation to which the defendants bind themselves to
have recourse.
Counsel for
the defendant drew to my attention the fact that the main issue in that case
was whether ‘replacement’ could be termed ‘repair’ and that the other lord
justices disposed of the appeal upon deciding that question. He is correct as
to that, but the logic and clarity of the words of Fletcher Moulton LJ are very
persuasive: a house which is kept in repair describes a state and not a mode by
which the state has been arrived at.
In Bishop v
Consolidated London Properties Ltd (1933) 102 LJKB 257, a dead pigeon
had obstructed a downpipe, causing damage by overflow of water. The covenant
that was sought to be enforced was that the lessors also will:
keep the
exterior of the premises and all parts of the building including halls
staircases and passages not the subject of this or some other letting in good repair.
Du Parcq J, at
p260, said:
I have to
consider — and really it is the only question for me, being bound, as I am, by
that decision — whether it can properly be said that in this case the water
system was out of repair; in other words, whether there was a breach of
covenant to keep it in good repair. I have come to the conclusion that a pipe
which is choked and not able to perform its function as a pipe is out of
repair, and that the defendants are none the less liable as for a breach of
their covenant though they may show that the cause of the defect in the pipe is
fortuitous and beyond their control. I think one must remember that ‘to repair’
a thing means to make it fit again to perform its functions; to ‘repair’ means
to put in order, and I think it means no more. When once it is seen, as the
Divisional Court has held, that the lessor under such a covenant as this is
bound to have the gullies, pipes, and the rest of the system for conveying
water, in repair at all times during the tenancy, then it is irrelevant to
consider whether the pipe became out of repair suddenly or by a slow
accumulation of debris, or whether it became choked, with or without any
fault on the part of the lessor.
Counsel for
the defendant submitted that that case was also distinguishable. However, if
the defendant’s submission is correct, then the judge would have held that the
landlord had a reasonable time to extract the pigeon before he became in breach
of the covenant. The judge did not so hold.
In Loria v
Hammer [1989] 2 EGLR 249, Mr John Lindsay QC, sitting as a deputy judge
of the Chancery Division, considered the effect of a covenant to keep in good
and substantial repair and condition. At p258, he referred to Bishop v Consolidated
London Properties Ltd and said:
It was held
that a disrepair amounted to a breach of covenant even if it was, as there,
quite fortuitous. I accept this submission of Mr Powell-Jones. Its corollary
would seem to be that the landlord is in breach as and when a disrepair occurs,
and not only at some time afterwards, and, furthermore, Mr Powell-Jones thirdly
submitted that a lessor does not have a reasonable or indeed any period of time
between a disrepair occurring and his being liable for breach of covenant. The
moment there is a disrepair, he submits, the duty to keep in repair has been
broken. I accept this submission, although it must be recognised that in a
covenant as to a landlord’s retained parts that can conveniently be reached
only through tenant’s premises some time may need to be taken up in the
landlord’s giving notice to and arranging access with his tenants so as to
avoid his trespass in inspecting and repairing the retained parts.
I adopt
everything that Mr John Lindsay QC said, which appears to me to be in
accordance both with the proper construction of the words of the covenant he
had to consider and with the law to which I have referred.
I conclude
that there has been a continuous line of authority, since 1818, to support the
conclusion that I have reached — that a covenant to keep in good repair
requires just that, namely that the premises should not fall into disrepair.
Counsel for
the defendant referred me to a number of cases, but I did not find them of
assistance. They appear to me to throw light upon whether particular
circumstances amount to disrepair, but do not in any way help me to decide what
is the proper effect of a covenant requiring the premises to be kept in good
repair.
He also
submitted that there was no business efficacy in construing a covenant to keep
in good repair, such that it would impose an absolute liability, as opposed to
one which required the landlord to undertake work with reasonable expedition
upon the defect arising. I have, in effect, already given my reasons for not
accepting that submission. As I have said, the purpose of the obligation is
twofold: first, to ensure repair; and, second, to settle the liability for the
effect of disrepair. In those circumstances, it does give business efficacy to
the arrangement between the parties.
For the
reasons I have given, I have come to the conclusion that the question posed by
the order of June 11 1993 should be answered such that the effect is that there
was an obligation to keep the property in repair at all times, such that the
defendant was in breach as the same ceased to be in a state of good repair.
I will hear
counsel as to the appropriate order to make.
Orders
accordingly.
