Cases - Lloyds Bank plc v Bowker Orford and another

Record details

Name
Lloyds Bank plc v Bowker Orford and another
Date
(1992)
Citation
31 EG 67, ChD
Legislation

Landlord and Tenant Act 1985

Keywords
Commercial property - landlord and tenant – service charge – landlord covenanted to repair the outside of the building – extent of covenant
Summary

The tenant covenanted to pay a service charge comprising, amongst other things, a lift service, a caretaker, security, cleaning and lighting of common parts, cleaning and lighting of lavatories, constant hot water, and 'any other beneficial services which may properly be provided by the lessee'.

There was a specific landlord's covenant to repair the outside of the building but no reference to repairs in the list of services for which the landlord was entitled to recover.

The landlord sought to recover:

  • costs of external repairs to the building;
  • costs of the internal decoration and/or repairs of the common parts of the building;
  • costs of capital as opposed to revenue expenditure in respect of plant and equipment providing hot water to the lavatories, the heating of the common parts and the provision of lifts;
  • costs of employing managing agents to carry out and provide the specified services; and
  • notional cost of providing accommodation in the building for a caretaker.

It was held that:

  • 1) and 2): A proportion of the cost of external repairs and internal decorations and repairs of the common parts were not recoverable as not being 'beneficial services'.
    The landlord was under an obligation to carry out external repairs and, if it had intended to recover the costs, it would have been very simple to reserve the right by reference to it in the list of service charges.
    Therefore, if the landlord has in mind the provision of a service, but has not covered the right to include the cost of providing it in the service charge, that landlord will not generally be able to argue that he or she has the power to provide the service under the sweeper clause, and to recover the cost.
  • 3): The specified services are not limited to revenue items and the lessors were entitled to recover the 'total cost' of providing the services.
  • 4): The landlord was entitled to recover the cost of employing managing agents to organise and supervise the provision of services.
  • 5): The landlord was entitled to claim a notional rent in respect of accommodation in the building for a caretaker.