Where a lease contains a qualified covenant requiring a landlord to consent to any alterations, in what circumstances is that covenant breached?

Leases contain rafts of covenants which restrict and sometimes prohibit a lessee from doing certain acts and things.  A lease covenant might prohibit a certain act (an absolute prohibition) or might instead allow that act subject to a landlord giving their consent (a qualified covenant).

A common example of an ‘act’ that’s often the subject of a covenant is the making of alterations to a flat.  Some leases contain an absolute prohibition against alterations, whereas others contain qualified covenants which require the consent of the landlord (often in writing and prior to the alterations being carried out).

In Raja & Doe v Aviram [2016] UKUT 0102 (LC) the Upper Tribunal (Lands Chamber) considered:

  1. if holes cut in the wall to install a new boiler breached the covenant against making alterations etc, and
  2.  when and how should consent be sought.

 

Relevant background

The lease contained a covenant in the following terms:

“The tenant will not at any time ….cut maim alter or injure any of the principal timbers, roofs or walls of the Flat… or make any structural alterations or additions whatsoever in or to the [Flat] externally or internally…. or make any alteration in the architectural appearance or exterior decorations of the [Flat] without the consent in writing of the [Landlord] first obtained”

The boiler to the flat broke down, and as a result a new boiler was installed which required a new vent and pipe to be inserted through the side wall.

It was alleged that this installation was in breach of the covenant which prevented alterations etc without the landlord’s prior written consent.  As such, an application was made to the Fist Tier Tribunal for a determination that a breach of condition or covenant in lease had occurred.

Despite the FTT having found that a new opening had been created in the wall and that the landlord had not consented, they (rather surprisingly) found that there had been no breach of covenant.

 

Appeal to the Upper Tribunal

The sole breach of covenant was the cutting of the wall for pipes without first having obtained the landlord’s consent.

Despite the works having been carried out by the lessee’s plumber (rather than the lessee himself), the Upper Tribunal found that he was responsible for the consequences of his instructions to install a new boiler.  There was only one way the installation could be done, and that was by the creation of a new hole.

The second issue for the Upper Tribunal was consent, or rather the lack of it in this case.

Several important points were made:

  • where a covenant against alteration is qualified by a need to obtain the consent of the landlord before carrying out the works, the burden of showing that consent has been unreasonably withheld falls to the lessee 
  • where consent is refused unreasonably, the lessee will be free to proceed with the improvement without making any further request
  • if a request is made and not responded to, it will be inferred that consent has been withheld unreasonably, so that the lessee will be free to proceed with the alteration without the need for consent.

BUT it’s essential that consent be sought beforehand and that the landlord be given proper information about what’s proposed and time to consider the request.

If an alteration is carried out before consent has been requested, then the leaseholder will be in breach of the lease (even if the landlord could not have refused the request).

 

Commentary

This cases serves as a reminder:

  1. for lessees to check the terms of their lease before undertaking any alterations to understand whether those proposed alterations are prohibited or whether they need the prior written consent of their landlord;

  2. for lessees to take steps to obtain their landlord’s consent, giving the landlord proper information and time to consider the request

If not, then a lessee may well find that they have breached the terms of their lease, and very serious consequences can flow from this……