Plaintiff landlord granting defendant three-year lease – Plaintiff landlord carrying out long-term roofing works towards end of lease – Whether defendant liable to pay service charges in respect of works – Plaintiff’s claim failed
On 14 October 1992 the plaintiff landlord granted the defendant tenant a lease of premises that formed part of second-floor offices at Waynflete House, Esher. The lease expired on 29 September 1995. By clause 4 of the lease the defendant was to contribute towards expenditure incurred “in respect of the services, particulars of which are set out in the Third Schedule”. These services included “Maintaining, repairing and (if necessary) renewing . . . the structure of the building”. In 1995 roofing works were carried out. It was common ground that the roof was in a state of disrepair. The plaintiff claimed £30,173.77 in service charges under the lease.
The defendant disputed liability to contribute towards the cost of the works on two grounds. Notably, it said that a number of requirements that would need to be established before liability for service charges arose were not satisfied. First, it was submitted that the roofing works did not fall within the ambit of schedule 3. The defendant submitted, inter alia, that the works constituted “renewal” of the roof, and part 1 of schedule 3 provided that renewal was only justified if “necessary”. Further, the defendant submitted that renewal was not “necessary” for the adequate performance of the roof over the remainder of its term. Second, it said that its liability was limited to expenditure that was “reasonably and properly expended”, and the roofing works did not constitute reasonable and proper expenditure.
Held: The plaintiff’s claim failed.
1. Whether works, including works to remedy an inherent defect, went beyond “repair” and amounted to “renewal” was a question of fact and degree in every case: Ravenseft Properties Ltd v Davstone (Holdings) Ltd [1979] 1 EGLR 54 and McDougall v Easington District Council [1989] 1 EGLR 93 applied. The roof was in a state of disrepair prior to the execution of the works. Neither the works necessary to overcome the effect of the inherent defect nor the totality of the works went beyond “repair”. The roofing works fell within the terms of schedule 3.
2. The lease did not entitle the plaintiff to charge the defendant for the cost of carrying out works that would fulfill its obligations over a period of 20 years or more, when such works were not necessary to fulfill those obligations over the shorter period of defendant’s lease. The works had been executed not for the purpose of fulfilling the plaintiff’s obligation to the defendant but for the purpose of satisfying the requirements of a prospective tenant. Considerable moneys had recently been expended on short-term repairs, and there was no evidence that those works had been ineffective. There was therefore no pressing need to commence long-term repairs prior to the end of the defendant’s term, which was imminent. The total amounts expended by the plaintiff were not “reasonably and properly expended or incurred”.
3. It was, however, reasonable for the plaintiff to expend money on short-term repairs, as the roof was in a state of disrepair and had the potential to leak. Therefore, in respect of those items or elements of the works, the defendant was liable to make a contribution of 40%.
Stephen Bickford-Smith (instructed by Hardwick Stallards) appeared for the plaintiff; Alexander Hill-Smith (instructed by Howletts) appeared for the defendant.
Sarah Addenbrooke, barrister
