Dilapidations — to repair or not to repair?

By Anna Mullins

The Court of Appeal has confirmed some fundamental points in relation to liability for dilapidations (Sunlife Europe Ltd v Tiger Aspect Holdings Ltd [2013] EWHC 463 TCC):

  • A landlord’s more extensive works caused by a tenant’s breach will not prevent recovering the cost to remedy the breach.
  • Where market conditions require upgrading in order to re-let premises, a tenant is not liable for works that would be subsequently abortive by supersession.
  • A tenant must comply with its lease obligations although he is entitled to perform his covenants in the manner that is least onerous to him.

The tenant, Tiger Television, occupied commercial premises in Soho under two leases granted in 1973. When the leases were granted, the premises were built to a state-of-the-art standard and the leases contained full repairing covenants.

Tiger acquired the premises in 2000, by which time they were already in a poor state of repair. Tiger carried out some works of refurbishment and repair to the premises but simply to make them suitable for its own needs…

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