Landlord must pay damages for noisy renovation work

A landlord has been ordered to pay damages to a commercial tenant after carrying out noisy and intrusive renovation work over a two-year period.

The case involved an art gallery that occupied the basement and ground floor of a multi-storey building. The lease entitled the landlord to carry out building works but it also contained a covenant granting the tenant quiet enjoyment of the premises.

In August 2014, contractors began the construction of new apartments from the first floor upwards. The works were expected to be concluded by August 2016.

The tenant took legal action, claiming that because of the noise generated and the encasing of the whole building in scaffolding, the work had substantially interfered with its use and enjoyment of the premises.

The court found in favour of the tenant.

It held that the landlord had not acted reasonably in exercising its right to build and had breached the covenant for quiet enjoyment.

The premises were let for use as a high-class art gallery. That required that the right to build should be exercised with particular regard, so far as reasonably possible, to the tenant’s need to keep the gallery running and with as little disturbance to it and its customers and staff as possible. The landlord had not done that.

Damages were assessed at 20% of the rent, payable from August 2014 until the date when the work is completed later this year.

Please contact Janice Young if you would like more information about the issues raised in this article or any aspect of commercial property law.