The importance of appearance in dilapidations

In the wake of the publication of the 7th edition of Dilapidations: The Modern Law and Practice, co-author Nick Dowding QC uses a colourful example to explore the importance of appearance. Some years ago, the owner of a three-storey Kensington townhouse painted the entire front facade in vertical red and white candy stripes, allegedly out of pique at neighbours who had objected to their redevelopment plans. The planning authority served them with a notice under section 215 of the Town and Country Planning Act 1990 (which entitles the authority to require remedial work where “the amenity of a part of their area… is adversely affected by the condition of land in their area”) requiring them to repaint the front elevation white. The court on a judicial review (R (on the application of Lisle-Mainwaring) v Isleworth Crown Court and another [2017] EWHC 904 (Admin); [2017] PLSCS 96) quashed the notice, holding that section 215 cannot be used “to deal with questions of aesthetics, as opposed to disrepair or dilapidation”: it was an improper use of the section to use it to “alter a lawful painting scheme, when there is no suggestion that there is any want of maintenance or repair in the land”. So much for section 215. But what about the law of dilapidations? Is there a bright-line distinction between aesthetics and disrepair for the purposes of covenants to repair in leases? In one important sense, there is. It is well-established that a covenant to repair is only engaged where the subject matter is in disrepair, ie where it has suffered physical damage or deterioration from some previous physical condition. A building which, as originally constructed, is ugly, unsightly or idiosyncratically decorated will not ordinarily be, on that account alone, in disrepair, however unattractive it may otherwise be. But once admitted or proven disrepair has occurred, aesthetic factors may have an important role to play when deciding whether the remedial work has been carried out to an appropriate standard. One aspect of this is that the tenant may be obliged to ensure that the work matches the surrounding areas, or existing decor, of the premises. The case law Two examples from the cases may be given. In Sunlife Europe Properties v Tiger Aspect Holdings at first instance [2013] EWHC 463; [2013] 2 EGLR 55, the judge agreed with the landlord’s expert that, in relation to suspended ceilings, it would not be acceptable to “create a patchwork effect by fitting some new tiles into a ceiling that contained a substantial proportion of existing tiles”. He went on to say in relation to window cills: “Once it became necessary to replace a significant proportion of cills because they were damaged, I consider that it was very likely necessary to replace the others in order to achieve an acceptable consistency of finish and appearance.” Likewise, in Sirhowy Investments v Henderson [2015] EWHC 3562 (Ch); [2015] EGLR 19, the patching of holes in fencing by sheeting was held not to be a satisfactory repair, because “the Lease required [the tenants] to effect repairs in keeping with the remainder of the fencing… They had to ensure that the end product was consistent with what already existed.” So, depending on the circumstances, it may not be enough for the tenant to say that, in terms of the end result, the work carried out has remedied the physical defect constituting the disrepair, or that the work was carried out with proper materials and to a good standard of workmanship: it may be necessary in addition to demonstrate that the work is aesthetically in keeping with the existing appearance of the undamaged parts of the premises. As always with dilapidations, however, the question depends on the detailed facts. Take, for example, the replacement of isolated defective floor tiles in a toilet. Where the toilet in question is on the shop floor of a 1930s factory in an industrial area used for a manufacturing business, it may not much matter that an exact match with undamaged tiles cannot be achieved. It may be possible to conclude in such a case that, having regard to the age, character and locality of the premises, a mix and match of tiles would not make the premises unfit for the occupation of a reasonably minded tenant of the class who would be likely to take them. But quite different considerations may apply to a toilet in the client area of a top-specification office block in the City of London, where it may be essential that there is a high-quality and uniform finish over the entire floor area. A further, related, aspect of the same principle is that work which results in the visual appearance of the premises being materially worse than it was prior to the occurrence of the disrepair may be held to fall short of the requisite standard of repair. This was the case in Blue Manchester v North West Ground Rents [2019] EWHC 142 (TCC); [2019] PLSCS 30, where the question was whether temporary remedial works to the external panels of a modern tower building, which involved the use of “stitch plates” to hold the panels in position, were sufficient to satisfy the applicable standard of repair. It was held that they were not. The unitised appearance of the glass facades was an important aspect of the original design of the building, and the works had a “significant adverse impact” on that appearance. An alternative scheme put forward by the landlord after the trial was also rejected (at [2020] EWHC 2777 (TCC)), on the ground that, although its aesthetic impact represented “an obvious and significant improvement on the stitch plates”, it was nonetheless “an obvious and significant worsening compared with the original unitised appearance”, and to require the tenant to accept it would involve requiring it “to accept a visual appearance which is materially different from and significantly less visually impressive than the original appearance”. Cleaning and decorating Much the same is true in principle where the covenant in question requires cleaning. Depending on the facts, the tenant may be held liable to do the work in such a way as to produce a reasonably uniform appearance. So, in Shortlands Investments Ltd v Cargill plc [1995] 1 EGLR 51, the landlord recovered by way of damages the cost of cleaning stained or discoloured ceiling tiles, on the basis that: “To clean some tiles and not to clean others would produce an appalling patchwork effect. All the tiles had to be cleaned and coated.” Modern leases invariably contain express covenants to decorate in some form or another. Many require the tenant to redecorate in colours to be first approved by the landlord. But even where that is not the case, it seems likely that, in the ordinary case at least, the requisite standard of redecoration is to be judged by much the same factors that apply to a covenant to repair, so that the use of a wholly inappropriate colour scheme may not suffice. Equally, the obligation will ordinarily require the covenantor to decorate in such a way as to achieve an acceptable match. So, for example, in Commercial Union Life Assurance Co Ltd v Label Ink Ltd [2001] L&TR 29, the court held that the redecoration clause required the tenant either to repaint low-level blockwork in a matching colour or to repaint the whole blockwork in one colour. Earning one’s stripes To return to the red and white-striped Kensington townhouse, what, if anything, would have been the position if the owner had been the tenant under a lease? Clearly, the answer will depend on the detailed terms of the lease. Treating the question as one of general principle, however, if the repainting had been necessary because the exterior was in disrepair, it might be argued (by analogy with the position in Blue Manchester) that the tenant was liable not merely to repaint, but also to do so in a way which did not result in the visual appearance of the premises being materially worse than it was prior to the disrepair. Equally, if the repainting was done pursuant to an express covenant to redecorate at specified intervals, the tenant might have been in breach by failing to use an appropriate colour scheme. But if there was no existing disrepair and the repainting was done purely out of a desire to change the building’s appearance (and using proper materials and to a good standard of workmanship), the position may be more nuanced as regards the covenant to repair. On one view, since the premises are physically undamaged, and indeed newly decorated, there is no disrepair, and therefore no breach of covenant. Might it be said that the use of an inappropriate colour scheme constitutes disrepair? Or alternatively, might the landlord base a claim on voluntary waste? As always, the ability of the law of dilapidations to throw up new problems and discussion points seems never-ending. Nick Dowding QC is a barrister at Hollis, and co-author (along with Kirk Reynolds QC and Alison Oakes) of Dilapidations: The Modern Law and Practice Photo © Shutterstock