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Tenants who are faced with unexpected demands in respect of repair costs would be well advised to seek legal advice. In a recent case, leaseholders of units of student accommodation successfully argued that they were not liable to pay service charges in respect of replacing the buildings' windows.
The leaseholders held long leases over rooms in two blocks of student accommodation. Since 2019 there had been problems with damp: the landlord's surveyor attributed this to poor workmanship in relation to the supply and installation of the windows, and recommended that they be replaced. The leaseholders received service charge demands for replacement of the windows, which was expected to cost around £4.8 million. They claimed that they were not liable to pay for the work, and their own surveyor claimed that the windows could be repaired at a much lower cost.
The leaseholders argued that the windows of their properties had not been 'demised' to them under their leases and did not fall under the repairing covenants in them. In point was a clause stating that the property demised excluded 'all communal windows and communal doors and windows ... on the external walls'. As the word 'communal' did not appear before the second reference to windows, they argued that all the external windows were excluded. They also pointed out that it would be difficult for individual leaseholders to carry out such extensive repairs. However, the court agreed with the landlord's interpretation of the clause, noting that it would be odd if it excluded the windows as another clause expressly included them.
However, the court found that none of the problems amounted to disrepair but were defects in construction or installation, so remedying them did not fall under the repairing covenants. Concluding that the windows would have to be replaced, the court went on to rule that an obligation to replace items beyond repair was not engaged as there had been no disrepair. The landlord could therefore not recover the costs of any works carried out by means of service charges.