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Landlord warning after tenant wins compensation

24 August 2009

Landlords are being warned they face court action if they fail to tell tenants about their intentions.

Shoosmiths says commercial property landlords should always keep tenants ‘in the loop’, or risk being hit with a claim for misrepresentation.

The warning comes after the Court of Appeal awarded a tenant compensation under the Landlord and Tenant Act 1954.

A landlord wanting to carry out work on a commercial property served notice to end a tenant’s lease relying on the intention to redevelop, but later decided not to go ahead with the work due to the economic downturn.

The landlord did not advise the tenant of its change of heart.

After vacating the property and renting alternative premises, the tenant discovered that the landlord had postponed its plans and re-marketed the property.

The tenant began legal proceedings for compensation, and the Court of Appeal found in the tenant’s favour due to the landlord’s misrepresentation.

Shoosmiths partner and property litigation specialist Darren Clegg said: “It is unclear in this case whether failing to keep the tenant in the loop was intentional or an oversight.

“What is clear, is the fact that tenants must be told about changes and kept informed about what landlords intend for their properties, otherwise landlords can expect to face costly and time-consuming legal action.

“They can also be ordered to pay compensation for any loss the tenant suffers as a result.”

 

For further information please contact:
Name: Alastair Gray
Phone: 08700 864096
Email: Alastair.Gray@shoosmiths.co.uk

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