The Covid-19 global pandemic is changing usual working practices. How does the government’s requirement that people only leave their homes to work if it cannot be done from home affect the usual operation of buildings?
In this legal insight, we look at this, and other practical issues for building occupiers and owners.
In theory, the landlord cannot derogate from grant. This means that if the landlord has granted the tenant rights over common parts (for example to get to and from their premises), then the landlord cannot stop the tenant from exercising them.
However, even if tenants have a right to use common parts, they should look carefully at their leases to see if the rights are only exercisable during ‘permitted hours’. If so, can the landlord change the permitted hours (acting reasonably or otherwise)?
It might be reasonable, for example, for the landlord to drastically reduce the ‘permitted hours’, for example if they can only get security or receptionist staff at certain times and/or on certain days.
The landlord’s obligations will depend on the drafting in the lease. It is usual for a landlord to be under an obligation to use ‘reasonable endeavours’ to provide services. The services could be quite broad and range from matters such as cleaning of common parts, lighting and heating in the common parts, to the provision of security and reception staff.
Covid-19 will almost certainly give landlords a reasonable excuse for not being able to provide services, owing to lack of staff and shortage of supply, etc.
Therefore, it could be that the tenant can continue to use common parts, but will have to accept that the landlord is not going to be arranging for them to be cleaned. Given the enhanced cleaning regime that is currently recommended, this could put tenants at risk.
A lack of security could also be an issue for tenants. Individual tenants will need to consider the health and safety implications for their employees should they require some staff to continue to work on the premises.
We are likely to see situations like this becoming fairly common. The landlord may, if you are the only tenant in the building, ask you to assume responsibility for carrying out the weekly alarm test, for example. You should think carefully about whether you do this and, if so, how it is documented. Also consider what happens if you are unable to do it, and what happens if a fault develops. Whilst you will want to be as accommodating as you can, you don’t want to be liable if the alarm is not tested and this invalidates the insurance.
It might be that commercial agreements are entered into, with money changing hands for the provision / procurement of ‘services’ by the tenant in the landlord’s ‘absence’. Legal advice should be obtained before such agreements are entered into.
Commercial landlords’ forfeiture rights for non-payment of rent are suspended until at least 30 June under measures contained in the Coronavirus Act 2020. See our legal insight on this specific topic for more details.
The requirements in relation to the service of the break notice will be set out in the lease. These need to be strictly complied with. Therefore, you need to make sure that you are serving the correct form of notice, at the correct time, on the correct party. The Covid-19 pandemic does not change this, although it may well make the requirements more difficult to satisfy.
Landlords and tenants are going to need to work together to navigate through this crisis. That may involve coming up with innovative solutions to ensure that buildings that need to remain open (to a greater or lesser extent) can do so. If you’d like to talk about how any of these issues affect you, please get in touch.
Contributor: Alexandra Holsgrove Jones
This publication is intended for general guidance and represents our understanding of the relevant law and practice as at March 2020. Specific advice should be sought for specific cases. For more information see our terms & conditions.