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Repairing obligations
A modern commercial lease contains what is known as a "tenant’s full repairing and insuring obligation". Typically, this binds the tenant to maintain, repair and renew if necessary, irrespective of the cause of damage. The words in Italics have very specific technical meanings, and specialist advice is essential to ensure that the tenant understands the position and that adequate protections are put in place.
For example, a tenant should not be liable for maintenance etc. where damage is caused by a risk, which should be covered by the Insurance policy the Landlord is obliged to take out.
The tenant should not have to repair etc. where damage is caused by the Landlord in the course of inspection. A standard lease drafted by a Landlord's lawyer will not contain these protections and they must be drafted in by the tenant's lawyer, who has to be alive to the finer points of drafting.
Landlords didn't used to expect short leases to be on a full repairing and insuring basis. The tenant would normally be liable for internal repairs only. There has been a disturbing change in recent years, however, which seems to have been given some strength by tenants agreeing to full liability, in some cases with inadequate legal advice.
Destruction of Property
The common law provides that if a property is destroyed through no fault of the landlord or tenant, the lease comes to an end.
Modern full repairing and insuring leases are normally drafted on the basis that this does not apply. Instead, the lease continues subject to an abatement of rent while the property cannot be occupied. The landlord normally insures against loss of rent (at the tenant's expense). Some leases provide that if the property is not reinstated within a set period of two or three years, either party can terminate the lease.
It is possible, therefore, that a tenant could have to find alternative accommodation for a reasonable period, but still be liable for rent again after reinstatement some years later. This issue has to be addressed and discussed at the negotiation stage.
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