Cases - Gibson Investments Ltd v Chesterton plc (No. 2)
Record details
- Name
- Gibson Investments Ltd v Chesterton plc (No. 2)
- Date
- [2003]
- Citation
- 1 EGLR 142, Ch D
- Legislation
- Keywords
- Commercial property - property management - dilapidations - air-conditioning - repair - renewal
- Summary
-
Air conditioning - The defendant landlord granted the claimant tenant a new lease for office property. A clause in the lease provided that the tenant was responsible for the repair, renewal or replacement of the air-conditioning system. It was common ground that the original system was inadequate and that, when the tenant replaced it, the replacement would fall within the terms of the lease. Two replacement systems were available. The one chosen by the tenant resulted in the relocation of various elements of the system, thereby creating more floor space. The tenant contended that the creation of this additional space amounted to an improvement, and it applied to the court for a declaration to that effect. The landlord maintained that works of repair could not constitute improvements, and that the work carried out merely represented the tenant’s obligation under the lease.
The court held, allowing the tenant’s claim, that the obligation to repair the system was an obligation to replace the system (if repair was insufficient) with something similar, and, if possible, included locating it in the same, or a similar, position. On the facts of the case, the tenant could have installed the new system in the same position as its predecessor, but it chose not to do so. Relocating the system was not, therefore, necessary for the purposes of the repair. The installation of the new air-conditioning system had discharged the tenant’s repairing obligation, but it had also altered the property so as to increase the letting space. That alteration required consent under the terms of the lease. Upon the grant of such consent, the work would be classed as an improvement to be disregarded on rent review on the assumption that the obligation under the original repair clause had been met.