Suing a Tiger – Commercial Property

Tiger Aspect Holdings Ltd leased some offices in London’s Soho Square. The lease included terms to ensure they did various repair works while they were there. However, once the lease expired and Tiger had left the building, the landlord, Sunlife Europe Properties Ltd, found the premises were in poor condition.

In order to re-let the property, the landlord had to carry out extensive works. They then sued Tiger to recover the cost of the works. Here’s what happened next.

Both parties briefed specialist valuers to produce reports about the value of the property – this is not the role of a solicitor, although we are increasingly asked for our view on what works are required and who should be liable.

The judge looked at the following issues:

  • What was Tiger supposed to do under the terms of the lease
  • What was the reasonable cost of repairing the building to get it into the condition it would have been in if Tiger had done the required works
  • What was the different between the value of the property in its actual condition, compared with what it would have been worth if Tiger had kept it in good repair

The tenant should have returned the premises in ‘good and tenantable repair and condition, and with the mechanical and electrical systems in satisfactory working order’. According to the lease, Tiger did not have to replace the lift or air conditioning with new apparatus, as long as the existing equipment still worked.

In this case, the landlord decided to re-render the façade of the building to make it more attractive. They would have done this even if Tiger had left it in good repair, so this was not included in the judgement.

This area is known as ‘dilapidations’, and covers many detailed and difficult points of law. This is where a commercial property solicitor is indispensable.

Disputes like this can sometimes be resolved using Professional Arbitration on Court Terms (PACT). Rather than depending on a judge with legal expertise, the Law Society of Royal Institute of Chartered Surveyors will appoint an arbitrator who may be a building surveyor with professional expertise in buildings.

Some questions for you to consider…

  • Do you own or rent commercial property?
  • What’s covered in your lease?
  • Are repairs being done as required?

For more information, please call us on 020 7113 4003 or email and we will be happy to help. The initial telephone consultation is free.

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