In Timothy Taylor Ltd v Mayfair House Corporation 2016, the High Court awarded a Tenant damages after deciding that the Tenant’s right to quiet enjoyment of the property had been breached by the Landlord.
The Tenant ran a top-end art gallery in Mayfair, London. The commercial lease contained an express covenant by the Landlord permitting the Tenant to peaceably and quietly enjoy the property.
The gallery was situated on the lower 2 floors of the property. In 2013, the Landlord commenced substantial redevelopment works on the upper floors. The scaffolding that had been erected enveloped the property and impeded access to the art gallery. This, together with the high level of noise generated by the redevelopment works led the Tenant to bring a claim for damages for breach of its right to quiet enjoyment.
Decision
The court held that the Claimant Tenant, was paying a significant rent for the property. Consequently, the Defendant Landlord should have been extra vigilant in ensuring that any disruption was minimal. The court confirmed that when considering the work that can reasonably be carried out the knowledge and/or notice given to the Tenant of the works at the commencement of the lease is a relevant factor along with any offer of compensation made by the Landlord for any disturbance. In this case the Landlord refused to pay any compensation, as such, the court held that this increased the level of care in executing the works required of the Landlord.
In reaching its decision the court also considered whether the works benefited the Tenant or whether they were being carried out for the sole benefit of the Landlord.
Taking all the above into account, the court held that the Landlord acted unreasonably in exercising its right to build and erect scaffolding in the manner in which it did. The scaffolding could have been constructed differently so as to reduce its impact on the Tenant. The Landlord elected not to liaise with the Tenant as to the duration of the works or the noise levels and how the impact of the noise could be mitigated. The court awarded the Tenant damages equal to 20% of the rent from the date the scaffolding was erected to the date that works are completed.
Comment
Landlords should maintain a good relationship with Tenants and open a dialogue at the earliest opportunity when works are being considered. Parties can then discuss mitigation, duration and even compensation. In this particular case, compensation would have lowered the bar of reasonableness which the Landlord’s works needed to reach.
