Rent Reviews - it's never too late!
In the current climate a rent review under a long lease is a welcome opportunity for a landlord to improve the return on their property. This makes a recent case law decision that arose out of a late rent review of interest to both landlords and tenants.
The case of Bello v Idealview Limited [2010], though the facts of this case are rather exceptional, held that where a landlord overlooks a rent review, their inefficiency in triggering it late will not, generally, mean that they lose the right to an increase and a payment for “back-rent”.
There is no implication that time is of the essence in respect of time limits in a rent review clause, unless expressly dealt with in the lease or in the surrounding circumstances. The Idealview case confirms that even a 13 year delay was not enough, in the absence of other factors, to prevent the landlord from triggering a rent review.
A tenant could seek to rely on a defence of estoppel, though in simple terms the landlord would have had to make a representation that it did not intend to carry out the review and the tenant to have altered its position so that it would suffer hardship if the rent review were triggered late.
Where a tenant does not have a right under the lease to initiate any of the steps on a rent review process and wants to bring the rent review to a head, a tenant would be advised to serve a notice on the landlord requiring it to commence a rent review within a reasonable time.
This article contains information of general interest about current legal issues. It does not give legal advice and specific advice should always be sought about your particular circumstances. We will be happy to assist.
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