Prohibited alterations made to leasehold property – should retrospective consent be given?

In the case of Duval v 11-13 Randolph Crescent Ltd [2020] UKSC18,  the Supreme Court held that, where there is a covenant by the landlord to enforce the terms of the lease against other tenants of the building and where (as in this case) there was a total ban against the tenants carrying out structural alterations, the landlord could not give consent to structural alterations. To do so would amount to a breach of the landlord’s covenant to the other tenants in the building: namely that the landlord would enforce the tenant’s covenants in the other flat leases. 

Varying the lease to the subject property to remove the prohibition will not resolve the matter. Each lease is a stand-alone contract.  Most leases for a development or building will require the landlord to grant all leases on substantially the same terms and to enforce the covenants in the lease against other owners.  To vary one lease would still amount to a breach of those landlord’s covenants in the other flat leases.

Whilst it may be possible to obtain the consent of all of the other registered leaseholders, this is not advisable as it could set a precedent and an assumption by other leaseholders that “anything goes”. 

It may also be possible to vary all of the leases, but this will require the consent of all leaseholders and their mortgagees.  Leaseholders are unlikely to want to incur this expense unnecessarily.

The facts of the case will need to be considered carefully, with retrospective consent only given with extreme caution.  At the very least, a full indemnity should be sought from the leaseholder to cover any and all damages, together with losses incurred by the landlord/management company arising out of a claim brought against them by others.

SE-Solicitors advise clients about alterations. For more information about our Property Portfolio Management services, including Debt Recovery, please click here.