Dilapidations Case Law Update – Gill v Lees News [2023]

A recent case and its subsequent appeal to the Court of Appeal have provided valuable insights into what constitutes a successful challenge to a new lease under the Landlord and Tenant Act 1954.

In this case, the landlord sought to oppose the renewal of a lease on several grounds, including persistent delays in rent payments and the tenant's failure to meet their repair obligations. The tenant had agreed to maintain the premises in good and substantial repair, a commitment they had not fulfilled during their tenancy. Consequently, the landlord served counter notices opposing the new lease.

The Court of Appeal upheld the trial judge's decision, which favoured the tenant and granted a new lease. However, there were significant points regarding the repair obligations that should be considered.

Key Considerations from the Court of Appeal:

  • Relevant Date for Grounds of Opposition: The Court of Appeal determined that while the state of repair at the hearing date is most relevant, the tenant's historical behaviour and compliance with covenants are also important. In this case, the tenant had remedied the disrepair before the trial date, and the Court of Appeal deemed it unlikely they would allow the property to fall into disrepair again.
  • Impact of Poor Compliance History: The court clarified that if a tenant has a poor compliance record and only addresses issues at the last minute, this could influence the court's decision on whether to grant a new tenancy.
  • Conduct and Lease Renewal: There are situations where a tenant’s conduct may lead a judge to decide against granting a new lease. Although this benchmark was not met in the current case, tenants should be mindful of their overall conduct concerning compliance with repair covenants throughout the lease term.

Implications for Tenants:

Tenants should take away several important points from this ruling:

  • Proactive Maintenance: If there is any possibility of seeking lease renewal in the future, tenants should diligently consider their repairing obligations throughout the lease term. Addressing disrepair promptly and maintaining comprehensive records of ongoing maintenance and service is crucial.
  • Planned Maintenance Programs: Depending on the building's nature, implementing a planned maintenance program to address issues on a cyclical basis may be beneficial.

In summary, the Court of Appeal’s decision underscores the importance of tenants maintaining their properties and adhering to their repair obligations consistently, not just at the lease's end. This approach will significantly bolster their position should they seek a lease renewal in the future.

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