Lease of old building — Rust in steel frames — Recommended work of exposing steel and encasing in concrete — Lessees contended work not a repair — Whether lessor entitled to carry out works — Whether lessor entitled to access for works — Whether least expensive method can be insisted on
The plaintiff company granted leases of different floors in premises in Deansgate, Manchester. The defendant city council held a 20-year lease of a number of upper floors from October 1973. Eclipse, in the second action, held a similar lease from March 1974. In the former lease the lessor undertook to “repair exterior including walls roof main timbers and lift”; in the latter lease “to repair exterior and lift”. Under each lease the plaintiff lessor was entitled to recover a proportion of the expenditure on such repairs. The premises were constructed in 1925 of a steel frame, curtain walls and a flat asphalt roof. The steel frame appears to have rusted and, following a full structural survey and report, a firm of consulting engineers recommended that the frames be exposed, shotblasted and encased in concrete, the cost being in the region of £380,000 to £507,000. Neither lessee accepted that the recommended work amounts to a repair and accordingly they contended that they have no liability to make contributions to the expenditure.
The lessors brought proceedings for a declaration to establish: (1) whether they were entitled to recover their expenditure on removing the cladding, treating the steel and rebuilding; (2) whether the proposed work to the steel frames amounted to a repair; (3) whether they could use an alternative “Bagrat” method of renovation; (4) whether they had rights of access to the premises to carry out the work; and (5) whether they could compel the lessees to contribute to the preliminary expenses incurred on the structural survey and report.
Held No declaration. 1. The lessors’ repairing obligation does not include repairs which the lessor has no right to carry out, but the lessor has a right to carry out the work that is properly a repair within the covenants. It would be a repair to replace a particular area of damaged steelwork and cladding, but it was outside the scope of repair to treat the whole steelwork and cladding. One reason was because on the evidence the rusting to the steelwork had set in before the grant of the leases in question. The expression “exterior” in the leases includes the steel frame as “main timbers” or because exterior includes the cladding which is dependent on the steel frames.
2. The leases contained reservations in favour of the lessors to enter for specific purposes; therefore the parties did not contemplate, under the leases, that the lessors could enter for any other purposes. There was no implied right to enter to carry out even repairs, except to the extent that the leases specifically granted such rights: the lessors had no rights to enter to do the repairs.
3. On the evidence the lessors were not justified in removing all the cladding; repair is a question of degree. As to the “Bagrat” method of treating the steel frames, there was doubt as to the effectiveness of injecting the material and as to whether it would reach all the steel surfaces.
4. The expenditure by the lessors, in obtaining a surveyors and engineers’ report on the state of the steelwork and the recommended remedial work, was not recoverable from the lessees as the recommendations were excessive and went outside the scope of repair. However, any preliminary costs incurred in connection with work that was properly a repair within the covenants would have been recoverable. In summary, the recommended works were remedial and went beyond repairs.
Hazel Williamson QC (instructed by Stephenson Harwood) appeared for the plaintiff lessors; and Robert Wakefield (instructed by the solicitor to Manchester City Council, in the first action, and by Booth & Co, of Leeds, in the second) appeared for the defendant lessees in each action.
