The Court of Appeal’s recent decision in Hipwell & Son v Szurek  EWCA Civ 674 sheds some interesting light on how the Court will approach situations where it is asked to imply terms in to commercial leases and is an important reminder that the lease should expressly deal with all respective obligations between the landlord and tenant.
In Hipwell a covenant on the part of the landlord was implied by the Court to the effect that the electrical installation and other service media was safely installed and that it continued to be covered by any requisite certificate. The landlord, having breached that implied term, meant the tenant was entitled to rescind the lease and recover damages, interest and costs.
In coming to its decision, the Court made the following points:
This decision highlights the importance of making sure all obligations are expressly set out in the lease, particularly in relation to the exterior of the premises, the plumbing and electrical installation and supply.
It also shows that in circumstances where such obligations are not expressly dealt with, landlords and tenants will not always be able to rely on an Entire Agreement Clause to prevent the Court implying terms in to a lease.
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