Ellodie Gibbons appeared for the respondent landlord in this Court of Appeal case involving disrepair to a block of flats. The judgment explains the basis of general damages for such breaches.
The facts were simple enough. M had a leasehold flat. There was disrepair to the landlord’s parts of the block causing damage to (1) the interior of the flat and (2) the common parts. The flat was not uninhabitable and there was no damage the capital value of the flat. The common parts were described as “dilapidated, shabby and dingy”.
For part of the relevant period, M chose not to live in the flat for reasons unconnected with the disrepair. The main issue of principle in the appeal was whether M’s temporary loss during this period lay in:
(1) Impairment of the amenity value of M’s proprietary interest in the flat (if so, M would recover substantial damages), or;
(2) The experience of discomfort, inconvenience and distress which M actually suffered (if so, M’s damages were likely to be low or non-existent).
The Court of Appeal considered a quartet of leading cases on damages for disrepair, including Wallace v Manchester CC (1998) 30 HLR 1111. It adopted five principles, which can be summarised as:
- The loss consists in the impairment to the rights of amenity afforded to the lessee by the lease. Actual discomfort, inconvenience, distress etc. are only symptoms of this.
- It is therefore not a fatal obstacle to a claim for damages that the lessee chooses not to make full (or indeed any) use of the premises.
- However, residence elsewhere may be relevant to mitigation of loss.
- Even if relevant to mitigation of loss, residence elsewhere may well not cancel other forms of loss for ‘impairment of amenity’.
- In any event, in some circumstances, the court may quantify damages in excess of the current rental value.
Applying these principles, the Court of Appeal found that the judge had been wrong not to allow any general damages for the period when M lived elsewhere. The Court then went on to assess damages based on the notional rent of the flat for various periods.
A secondary issue related to a period of 3 years when M lived in the flat and there was disrepair to the common parts alone. The County Court judge had awarded £1,500 for general damages (£500 a year) based on three previous decisions involving damage to common parts. The judge then tested this award against her own assessment of rental value of the flat and a notional rentalisation of the loss of amenity at 1-2%, which confirmed her provisional view. Although Briggs LJ said he thought these damages were on the low side, the Court of Appeal decided not to interfere with them.
Alleged disrepair to common parts is an almost invariable feature of residential service charge claims. Moorjani is likely to provide very useful guidance in respect of such claims.