Weekly review: 27th February – 2nd March 2012

Contracts: equity: time of the essence

Equity took the view that time is not of the essence for performance of contractual obligations unless the express words of the contract, the nature of the subject matter or the surrounding circumstances indicated to the contrary. After the Judicature Act 1873, this is the common law rule too. Thus, time is not usually of the essence with respect to the timetable in a rent review clause; the right to a review is not lost because of  a delay in taking any step envisaged by the clause.

Rent is a contractual payment for the use of the landlord’s land. There is no legal reason why a rent review cannot operate retrospectively (United Scientific Holdings Ltd v Burnley Borough Council).

Deed of Mutual Covenant

Incorporated owners must do everything reasonably necessary to enforce the terms of the DMC (Bealieu Peninsula (IO) v Perfect China International Ltd).

Incorporated owners: locus standi

Incorporated owners have locus standi to bring actions to enforce rights (such as easements) on behalf of owners (Incorporated Owners of Block F1 – F7 Pearl Island Holiday Flats v Incorporated Owners of Pearl Island Garden).

Leases: implied covenants

An implied term that the property is reasonably fit for habitation is implied into a lease of a furnished house (Smith v Marrable).

Leases: repairing covenants

Any damage to property falls within a repairing covenant provided it is on the right side of the repair / renewal divide; that is provided that it does not involve giving back something substantially different from what had been demised. There is no exclusion for damage caused by an inherent design defect. Further, it may be that curing the design defect is the only acceptable way of repairing the property and, again subject to the question of degree, this curing of the inherent defect will fall within the repairing covenant (Ravenseft Properties Ltd v Davstone (Holdings) Ltd).

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