Stonecrest v Shepherds Bush Housing Association: repairs and insurance obligations

The High Court case of Stonecrest Marble Limited v Sheperds Bush Housing Association Limited [2021] EWHC 2621 (Ch) is an interesting case concerning a landlord’s repairing obligations and how these relate to its insurance obligations and judicial interpretation of legal documents.

Facts

The tenant’s (Stonecrest) property was significantly damaged by water ingress that was caused by the gradual deterioration of a drainpipe causing water to backup and ultimately overflow. As part of the lease, the landlord was obliged to allow the tenant quiet possession, clean, maintain and repair the common parts and insure against “insured risks”. Per the lease the landlord was not obligated to repair elements of the retained parts where it had no obligation to insure.

It was held that gradual deterioration by wear and tear was beyond the scope of the landlord’s insurance obligations and as such there was no need for the landlord to repair the drainpipe and therefore the landlord was not liable. The tenant accepted that the gradual deterioration was not included in the insurance obligations but maintained that the landlord should still repair the guttering as it was not demised to the tenant.

However, the court as it often does gave affect to the ordinary meaning of the lease and did not imply more onerous obligations on one party where it had not been agreed between them. The judge held that it was not for the court to determine how the lease would work in practice and then plug any gap in the repairing obligations that might arise, it was the court’s role to give effect to the meaning agreed between the parties.

Comment

This case does not create any new bespoke legal principles, it was a case decided largely on its facts and it follows a long line of cases where the court has refused to unwind or imply clauses into an agreement even if on the face of it the outcome seems rather surprising. The tenant can probably be forgiven for assuming that the landlord would have to repair the retained parts of the property but where there is no express obligation there are likely to be difficulties in enforcement.

The case is a stark reminder for parties to have their leases or any legal documents checked by a competent legal professional before they are agreed as judges will not interpret leases broadly. A comprehensive review prior to agreement will hopefully ensure responsibilities do not slip between the cracks and will save a significant amount of time and resources should an issue arise.

How can Birketts help?

Birketts have a specialist team of housing management and property lawyers who can assist clients with the preparation and review of lease agreements.

If you have any queries regarding the content of this article or wish to discuss any other housing management issue, please contact Clive Adams, Jonathan Hulley or any member of the Social Housing Team, to see how Birketts can help you.