Describe the Different Obligations Imposed by the Implied and the Express Repair Covenant in a Lease.
Describe the different obligations imposed by the implied and the express repair covenant in a lease. (list the various terminologies used and explain their meaning) A repair is ‘making good the damage so as to leave the subject as far as possible as though it had not been damaged’ defined in Clathorpe v McOscar 1924 Ultimately, the landlord wants to pass on the repairing responsibility to the tenant. Tenants will usually accept the responsibility as long as it is not too onerous.
The phrase caveat emptor buyer beware meaning the tenant should know the implications when taking on the lease show in Robins v Jones 1863 ‘fraud apart there is no law against letting a tumble down house’ There are two types of repairing covenants: fully repairing and insuring (FRI) and internal repairing and insuring (IRI). A FRI covenant is common and is where a tenant takes on full repair if the building in terms of structural damage as well as general damage. An IRI covers the internal parts.
An IRI covenant usually means there is a higher because the tenant has not taken on the full responsibility of repair. Lease lengths will also determine whether the lease is FRI or IRI as tenants may be reluctant to take on a FRI lease on a short lease as well as the type of properties e. g. new builds or listed buildings. The type of covenant will have an effect on valuation. The repairing covenant should be read alongside the terms of the lease. Express covenants allow the tenant and landlord to be clear on their responsibilities.
A tenant should identify state of property before a lease is made however premises are assumed to be in a ‘tenantable repair’ when the lease was granted. Implied covenants in repair require the tenant to act in an appropriate ‘tenant – like manner’. Lord Denning ruled in 1953 that a ‘tenant must take proper care of the place…. which a reasonable tenant would do’ and not damage the property wilfully or negligently. It was also ruled that if a house falls into disrepair through ‘fair wear and tear, lapse of time or for any reason not caused by him the tenant is not liable to repair it’.
It is important that ‘fair wear and tear’ is included in the lease otherwise the tenant may be liable for repair where it is not through his own fault. There is also an implied covenant not to commit waste; permissive waste (the failing to maintain the property), ameliating waste (making improvements to land and property) and voluntary waste (structural changes to the property). Committing waste may affect the value of the property as well as the rental and capital value.
Other implied covenants include; allowing landlord entry to carry out repairs; At the start of the tenancy the property is fit for human habitation (Smith v Marrable 1843) and There is an undertaking by the landlord to keep it so during the tenancy; duty to repair common parts (Liverpool City Council v Irwin 1977) The express repair covenants/obligations that are written in to the lease are; to keep in repair – the tenant should keep the property in repair throughout the whole terms of the lease. As soon as there is a disrepair there is a breach thus there is a reasonable period to put the property back in to repair.
This is the most onerous obligation; (this is the liability of repair. ) There is also an obligation to put in repair – this is similar to keep in repair as you have to put the property in repair in order to keep it in repair. Yield up in repair – here a tenant only has to maintain and put the property back in to repair at the end of the lease terms when the property is handed back to the landlord. To keep in good condition – this is a more onerous as it is asking more than to keep in repair and will be stated if this is the case.
This is different to keep in repair. To keep in a tenantable condition – to do what you should want someone else to do (being a good tenant). The repairing covenant may go further than simply repair; there are also express obligations to repair and renew, to carry out structural repairs, and to rebuild or replace, depending on the terms of the lease. Fair wear and tear of the property is usually accepted without having an onerous repairing obligation by excluding the tenants from the responsibility of ‘making good “the ravages of time”.
A defence is available if the tenant can show that the use of the premises was reasonable; Manchester Bonded Warehouse v Carr 1980 The liability to repair occurs as soon as there is disrepair. If, however the specified party is unaware of the disrepair, the liability falls when the party has been served a notice informing of the disrepair (landlord to tenant or tenant to landlord). Once the party is notified (thus aware) then this is when the liability of repair falls, however a reasonable time limit is given in order to restore the disrepair.
There is also an obligation to repair formed when entering a lease. There is a general standard of repair which takes in to consideration the property itself, the locality, state of premises before. This is reflected in the ruling of Proudfoot v Hart 1890; it was ruled “what was acceptable in Grosvenor Square and that which would be acceptable in Spitafields”. There is usually a decorating covenant; it is where the tenant will undertake to redecorate the premises on a periodic basis. This redecoration clause will usually specify the method of decoration and the frequency.
If there is a breach in the repairing clause caused by the tenant than there are a range of remedies that the landlord can receive; forfeiture can be used if the tenant is in breach. When a landlord wishes to forfeit he must not act in a way that would indicate that the tenancy is still continuing e. g. receiving a rent payment. This remedy however is becoming increasingly scarce. Damages – damages can be recovered by a landlord however statutory restrictions often prevent landlords enforcing this.
Specific performance is a court order requiring the party in breach to do what they are contracted to do. Rainbow Estates Ltd. V Tokenhold Ltd 1988 ruled that specific performance should be granted where the tenant had failed to comply with his repairing covenants. Carrying out the works and recovering the costs from the tenant- the landlord has a right to enter the premises in order to carry out the repairs where a tenant has failed to do so. Non-renewal of the lease (s30) can be used if the tenant has breached his repairing obligation.
The remedies for the tenant also include damages, specific performance and a form of self-help. Where the landlord has committed breach of the contract, the tenant can sue for damages where there is a measurable financial loss due to the disrepair of the premises. Set off allows the tenant to retain out of the rent a substantial amount to compensate the tenant. Specific performance is a court order requiring the landlord to carry out what they are contracted to do. Self Help –carrying out the works and recovering the costs from the landlord.