Ultraworth Ltd v. General Accident Fire & Life Assurance Corporation [2000] EWHC Technology 172 (27th January, 2000)

Ultraworth Ltd v. General Accident Fire & Life Assurance Corporation [2000] EWHC Technology 172 (27th January, 2000)

The proper measure of damages is the diminution in value of the reversion, not the cost of repairs, as the claimant did not intend to carry out repairs and the market evidence showed no higher value would have been achieved if the premises had been in repair. The works required to comply with the repairing covenant did not extend to full renewal of the air conditioning and heating system; re-conditioning and targeted repairs sufficed. The quantum of damages is limited to the actual diminution in value, which was not shown to exceed the price achieved on sale.

Citation
[2000] EWHC Technology 172
Parties
Original Lessor: Pebble Hall Investments Limited; Original Lessee: Chase Manhattan Bank; Defendant/assignee of Lease: Ultraworth Limited; Part 20 Defendant/underlessee: Buhler-Miag (England) Limited / Buhler; Claimant/current Freeholder: Enterprise House (Claimant)
Jurisdiction
England and Wales
Procedural Posture
Civil Property/landlord & Tenant / First Instance Judgment
Outcome
Claim dismissed
Legal Topics
Dilapidations, Repairing Covenants, Damages, Diminution in Value, Section 18(1) Landlord and Tenant Act 1927
Property Law Landlord and Tenant Law Contract Law Dilapidations Repairing Covenants Damages Diminution in Value Section 18(1) Landlord and Tenant Act 1927

Case Brief

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Parties

Pebble Hall Investments Limited

Original Lessor

Chase Manhattan Bank

Original Lessee

Ultraworth Limited

Defendant/assignee of Lease

Buhler-Miag (England) Limited / Buhler

Part 20 Defendant/underlessee

Enterprise House (Claimant)

Claimant/current Freeholder

Procedural Posture

Civil Property/landlord & Tenant / First Instance Judgment

Legal Issues

  1. 1 What is the proper measure of damages for breach of repairing covenants in a lease?
  2. 2 Does the cost of repair or diminution in value of the reversion apply?
  3. 3 What works are required to comply with the repairing covenant?

Ratio Decidendi

The proper measure of damages is the diminution in value of the reversion, not the cost of repairs, as the claimant did not intend to carry out repairs and the market evidence showed no higher value would have been achieved if the premises had been in repair. The works required to comply with the repairing covenant did not extend to full renewal of the air conditioning and heating system; re-conditioning and targeted repairs sufficed. The quantum of damages is limited to the actual diminution in value, which was not shown to exceed the price achieved on sale.

Court Disposition

Claim dismissed

Orders

  • Claim for damages for breach of repairing covenants dismissed.
  • No order for damages as no diminution in value proven beyond sale price.