Analysis of Repair Obligations in Property Law and Lease Agreements

This report delves into the critical aspect of repair obligations within property law, focusing on lease agreements and the responsibilities of both landlords and tenants. It begins with an introduction to repair obligations, establishing the importance of clear contractual terms in lease agreements. The report examines the specific duties of landlords, including maintaining premises and ensuring fitness for occupation, as well as the obligations of tenants, such as avoiding waste and adhering to repair clauses. The standard of repair is then discussed, emphasizing that it depends on the contract terms, the nature of the property, and relevant circumstances. The report also addresses reinstatement, outlining the conditions under which alterations to the property must be reversed. It further explores remedies for breaches of repair obligations, including interim damages during the lease and terminal damages for disrepair, considering relevant legal precedents and acts. The report offers a thorough analysis of repair obligations, providing a comprehensive overview of the legal framework governing property maintenance and the consequences of non-compliance.

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Table of Contents
Repair Obligations...........................................................................................................................1
Introduction......................................................................................................................................1
Repair Obligations towards the Landlord........................................................................................1
Repair Obligations towards the Tenant...........................................................................................1
Standard of Repair.......................................................................................................................2
Reinstatement...............................................................................................................................2
Remedies..........................................................................................................................................3
Interim Damages during the lease................................................................................................3
Terminal damages for disrepair...................................................................................................4
Debt claim of damages.................................................................................................................4
Conclusion.......................................................................................................................................4
List of References............................................................................................................................6
Articles.........................................................................................................................................6
Statute...........................................................................................................................................6
Case Law......................................................................................................................................6
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Repair Obligations
Introduction
In a lease agreement like any other contract there needs to be agreement between the lessor and
lessee or parties involved. There needs to be clear terms of contract which will obligate certain
duties upon the relevant parties involved. In a lease agreement the parties have to comply with
certain terms that are provided for expressly or impliedly. These terms must also be legally
binding for them to take effect. A crucial term to be considered is the repair obligation in a lease
agreement. This is vital in that the demised premises may require some maintenance or some
alterations carried out. In ascertaining this the terms of contract need to be looked into and their
implications are vital. The definition of repair was considered in Brew Brothers Ltd v Snax
(Ross) Ltd (1970), which stated that it will dependent on the context and usage but it will take the
normal English meaning of the actual fixing of a particular part of the subject matter depending
on the terms of contract and the nature of the lease. The repair obligation is therefore vital to be
considered. (Law Commission, 1995)
Repair Obligations towards the Landlord
This is a duty which the landlord has to comply with if it is expressly provided in the agreement,
in order for there to be a properly established landlord and tenant relationship within the law.
However this obligation may be mandatory in the following:
a) The landlord will have a duty to make sure that the retained premises shall be maintained
in such a manner that does not cause harm to the tenant
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b) The landlord will also have a duty to ensure that the demised property is completed
accordingly in order for it to be fit for occupation.
c) The landlord also a duty to ensure that once the construction is complete it should not
have any defects that may cause harm to the tenant.
d) The landlord will have to comply with any implied terms with regard to repairing the
premises, but an implied term shall not include those terms that may be contained in a
detailed code concerning repair for instance.
e) The landlord has a duty to comply with the statutes in place that create an implied term
with regard to repair. This may be seen in the Housing Act 1985 section 11 which
provides for repairing obligations for short residential leases.
f) Mostly landlords will be comply with repair obligations in instances where there are paid
a service charge in order for some level of maintenance to be done. (Law Commission,
1995)
Repair Obligations towards the Tenant.
The tenant is also not required to repair the premises unless expressly provided for in the
agreement. The tenants in certain instances may be burden with the obligations to repair. The
tenant may not commit waste. There are various types of waste on including, ameliorating waste
whereby the property is changed and improved in such a way that the physical character of the
property changes. The tenant will have to repair the property. Another waste is the voluntary
waste which entails the tenant acting in such a way that it leads to changes in the nature of the
property or destruction of the property. Permissive waste is whereby the tenant failed to perform
a certain act and this omission causes harm to the property. Equitable waste is also another form
of waste whereby the tenant commits an act which causes gross damage to the property. It may
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also be known as aggravated voluntary waste. The tenant will have to comply with his obligation
to repair where there is waste and additionally where there is an implied duty towards the tenant
to properly utilise the property, unless an express term is include in an agreement with regard to
the duty to repair. (Law Commission, 1995)
Standard of Repair
The standard of repair will be dependent on the terms of contract that have been agreed upon by
the parties. Therefore, it will be dependent on the construction of the contract and the nature of
the subject matter or circumstances involved. Therefore, the definition of the retained or demise
property needs to be clear in order for there to be a scope on what actually the repairs may be
based upon. Additionally, the contract terms must also indicate what is actually meant by
disrepair, and this may for instance exclude reasonable wear and tear. The subject matter or the
property needs to be clearly established and who will take care of what part may also be included
in the terms of contract. (Law Commission, 1995)
The extent of the repair obligation is crucial to determine with regard to the property. This will
also be highlighted in the terms of contract agreed upon and the nature and circumstances of a
given case. Some instances repair may not suffice and it may require an act of replacement. This
may be include in the repair obligations expressly provided in the contract and in what instances
such a replacement will happen and who will be responsible to ensure that the obligation is
discharged. (Law Commission, 1995)
The formula for an appropriate standard of repair will consider the age, the character and
location that would meet the fit ness of occupation of a reasonable tenant of that particular
scenario. This was seen in the Twinmar Holdings Ltd v Klarius UK Ltd (2013) in which the court
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had to determine whether a tenant is required to repair at the end of a lease. There was a
dilapidations claim brought against a landlord for a warehouse and office premises. According to
the lease the tenant had the obligation of repair during the duration of the lease. The roof lights
were damaged and the court had to determine whether the tenant was liable for the repair. In
determining this the court looked into the extent of the standard of repair. Edward-Stuart J
considered the test mentioned above of the age, location and character that would be reasonably
considered fit for occupation by a reasonable tenant as seen in the Proudfoot v Hart(1890). The
tenant was seen to be liable in this instance because the standard of repair also included the roof
lights though reasonable wear and tear was also factored in.
Reinstatement
In considering repair obligations it also vital to consider whether alteration in the subject matter
can be reinstated. Some alterations that are legally binding may be left as such in instances where
there is no obligation to reinstate. Thusly at the end of the lease agreement the tenant will have to
vacate the premises and leave it with the alterations. However, there is a right to remove the
tenant’s fixtures up until the terms of the agreement have expired. This reinstatement has to be
clearly expressed in the contract. In cases whereby the alterations are undertaken in an unlawful
manner, the tenant may claim that the landlord had an impliedly consented to the changes or
waived his consent. It is vital to ensure that reinstatement will only happen to unlawful changes
to the demised premises. In order for the right to reinstatement to be established it must be
clearly stated in the contract and must indicated that upon yielding up of the demised property
reinstatement will be done automatically. It must also indicate that the reinstatement will be done
automatically lest a notice is given to the contrary. Moreover the clause must also indicate
whether notice will be required to be issued by the landlord to the tenant with regards to the
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demised property. Clarity and certainty is emphasized even when it comes to changes to the
clause that indicates the reinstatement.
The term has to be clear on the duration required for the reinstatement. It must also indicate the
when the notice ought to be issued and reasonable time for compliance. If this is not done the
right to reinstatement will fail. Such a notice that is included a letter illustrating a terminal
schedule of dilapidations, will include a paragraph that will clearly indicate the notice to
reinstate.
The Housing and Development Act 1960 and through the Housing and Development Board
established under section 3 regulates certain disputes regarding the application of damages for
reinstatement by providing that the section will determine the assessment of damages like other
damages. This assessment will consider the extent of the actual loss suffered by the landlord due
to the breach in the obligation for reinstatement. It provides for payment to the tenant on
improvements made to the demised premises by the tenant. Therefore, the terms of the contract
and circumstances in a given scenario will be considered in determining the disputes that may
emerge.
Remedies
Interim Damages during the lease
It is important to note that damages for dilapidations by the landlord may not be claimed during
the duration of the lease. This is because the Leasehold Property (Repairs) Act 1938 (LP(R) A) in
instances where it is applicable, provides that, leave of the court needs to be applied in order for
a claimant to claim damages during the duration of the lease. In the application the claimant must
prove that the property has diminished in a certain ascertained value to the detriment of the
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reversion. This application ought to be done in compliance with the Civil Procedure Rules.
Additionally a claim during the subsistence of the lease is limited in damages due to the
application of common law principles in the determination of damages, the term that has not
expired still remaining in force, the reversionary interest involved, and the landlord can still
enforce the obligation to repair upon the tenant.
There are also alternative remedies that may be utilised during the duration of the lease. The
Jervis and Harris clause may be in place according to the terms of the lease in which the landlord
has a right to enter and repair and claim the costs from the tenant. The landlord may also
terminate the lease due to the disrepair. Therefore in order to claim for these damages in the
interim there needs to be service of an interim schedule of dilapidations. (Law Commission,
1995)
Terminal damages for disrepair
When there is a terminal breach in the obligations to repair a claim for terminal damages for
disrepair is claimed. The assessment of these damages will consider what the tenant obligation of
repair were and due to non-compliance of the obligation what loss was suffered by the landlord.
This may include a calculation of what costs will be incurred by the land lord to ensure that the
property is return to its actual reasonable value had the repairs being duly done by the tenant.
These damages may also include loss of rent during the time of disrepair. Additionally such a
claim will not be in excess of the diminished value of the reversion, due to the lack of
compliance of the obligation to repair the demised property. Further such a claim may also not
succeed if the property will be demolished upon termination of the lease or where the repairs
would have not made changes to the value of the property.
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The landlord that claims for these damages has to prove that the breach in the obligations to
repair by the tenant is what actual caused the loss suffered. In a claim whereby the assessment of
damages will consider works that are done or will be done by the landlord to repair the property,
the tenant has to prove that those cost of those works may not affect the value of the reversion or
to what extent those costs of the works may affect the value of the reversion. The connection
between the losses suffered has to be linked to the actual breach in the obligation to repair. (Law
Commission, 1995)
Debt claim of damages
A debt claim may be also claimed by the landlord for the repair of the demised property carried
out during the subsistence of the lease. In order for the landlord to carry out the necessary works
to the demised premises during the subsistence of the lease there needs to an express the right to
enter and carry out the repairs, the Jervis and Harris clause as mentioned earlier. The clause may
indicate that notice is necessary to be served upon the tenant indicating the repairs to be taken
and the duration for those repairs. Failure of the tenant to undertake those repairs the landlord
may enter the demised property and carry out the works necessary to repair the premises. The
costs of the repairs will be debt claim upon the tenant. The court in the determination of this will
consider the damages in line with the breach in the right to the peaceful enjoyment and use of the
property, the time undertaken to repair and the reasonable costs of the works. (Law Commission,
1995)
A tenant may also claim for a breach of the obligation to repair by the landlord. The residential
tenant may rely on an express term of contract in which the landlord has the duty to maintain and
repair the property and may be even certain areas of the property. The standard of repair will be
determined by the principles mentioned above. Where the landlord had knowledge of a certain
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defect and has failed to render the property in the appropriate way, the landlord will be liable for
the breach of this term. (Law Commission, 1995)
Conclusion
In leases the repair obligation has fundamental implications. The clause is preferably expressed
in clarity the agreement. The implication of it being considered to be impliedly are limited to
certain scenarios. It would be therefore vital to consider the form it takes in the lease agreement.
The obligations towards both parties have to specifically state the areas of the subject matter that
are to be repaired, and to what extent that the repair has to be done. In addition, there should be
clarity to who is responsible or obligated to ensure that this is done. There should be measures to
ensure that upon failure the lessor or lessee may be prompted by a notice to rectify the breach
and what will be done if the breach is not rectified within a certain period. It will be also vital to
consider whether reinstatement may apply in that a further clause is inserted to recognise
improvements and what will happen upon termination of tenancy. It still no solution is found
alternative dispute resolution mechanisms may be contacted to determine liability and damages.
This may also be include in the lease agreement. These damages will be awarded depending on
when they are claimed; at termination or during the subsistence of the lease. Additionally they
will consider the terms of the lease agreement and the nature of the lease in order to determine
the matter in a just manner.
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List of References
Articles
Law Commission, (1995) Landlord and Tenant: Responsibility for State and Condition of
Property Item 5 of the Sixth Programme of Law Reform: Landlord and Tenant (LAW COM No
238) London:HMSO
Statute
Housing and Development Act 1960
Leasehold Property (Repairs) Act 1938
Case Law
Brew Brothers Ltd v Snax (Ross) Ltd [1970] 1 QB 612
Proudfoot v Hart (1890) 25 QBD 42
Twinmar Holdings Ltd v Klarius UK Ltd [2013] EWHC 944 (TCC)
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