Don’t put it off – Rent Reviews
Warning – Even long outstanding rent reviews can be actioned
The case of Bello v Ideal View provides a stark reminder that rent review provisions can still be exercised by a Landlord even after a very long delay.
Facts
The case relates to a 50 year Lease with the provision for a rent review at year 25 (exercisable in 1994). Mr Bello, acquired the Tenant’s interest under the Lease in 2005 and Ideal View brought the Landlord’s interest in the Lease in 2006. Some 14 years after the right became exercisable, the Landlord initiated the rent review procedure.
The rent was increased significantly from £60 per annum to £1,700 per annum in 2007. The Landlord also claimed payment of the back dated uplift in rent from 1994. Mr Bello did not discharge the arrears and possession proceedings were issued and granted in favour of the Landlord.
On appeal, the Court again found in favour of the Landlord stating that if the rent review provisions do not put a time limit on initiating the rent review process (as most invariably don’t), then even in cases of a substantial delay, such as to be unreasonable or even causing prejudice or hardship to the tenant, this did not in itself negate the Landlord’s contractual right to implement a review. The only exception to this is where the Landlord is said to act in some way so as to equate to a waiver of his right to review the rent and the tenant then acts in reliance upon it.
This is perhaps a surprising outcome for some but in any event drives home the notion that both landlords and tenants should be alive to the extent of their obligations and rights under a lease and the need to carry out careful due diligence, particularly if acquiring a leasehold interest by way of assignment. It also reminds landlords and tenants alike as to the importance of careful drafting when composing their Leases.
