Supreme court rules on retail tenant's service charge bill
Supreme court ruling: Sara & Hossein Asset Holdings Ltd v Blacks Outdoor Retail Ltd
The Supreme Court has ruled that whilst a landlord’s service charge certificate was initially conclusive of the sums payable by a tenant, such wording did not ultimately preclude the tenant’s right to dispute liability for such a payment.
In this Sara & Hossein Asset Holdings Ltd v Blacks Outdoor Retail Ltd case, the tenant’s service charge bill was nearly eight times higher than the previous year. The tenant argued that certain costs were not properly due under the terms of the lease.
The lease stated that the landlord's certificate of the total cost and sum payable by the tenant was conclusive (in the absence of manifest or mathematical error or fraud). The High Court originally decided that this meant that the landlord’s certificate was conclusive as to the costs incurred in providing the services, but not as to whether the landlord was entitled to charge for such services in the first place. The Court of Appeal had since overturned that decision and ruled that the landlord’s certificate was conclusive as to all elements which made up the “total cost” of the tenant’s bill.
The Supreme Court came to a compromise between the decisions of the High Court and the Court of Appeal. The landlord could initially enforce by way of summary judgement the sums certified by the landlord, but this did not stop the tenant disputing its service charge bill at a later date. This was referred to as a “pay now, argue later” provision.
This case shows that a tenant should still be wary about agreeing a service charge provision which provides that a landlord’s certificate as to the amount of service charge due is conclusive. However, if such a provision exists, the tenant is likely to be out of pocket initially as it would be required to pay the sum demanded first, but it would not prevent a tenant from disputing the landlord’s determination.
Discover more
Our expertise
You may be interested in...
Opinion
Law Commission initial consultation published on reforming Part 2 of the Landlord and Tenant Act 1954
Press Release
Browne Jacobson advises retail giant The Range on its acquisition of Homebase
Opinion
Power for local authorities to conduct compulsory rental auctions of vacant high street properties to come into force next month
Legal Update
Building an inclusive workplace: strategies for attracting and retaining disabled talent
Legal Update
Roundtable report: Community engagement in high street regeneration
Legal Update
Reform of Gambling Regulation in Ireland
Press Release
Browne Jacobson sponsors public sector think tank on new report
Press Release
Browne Jacobson continues expansion in Ireland adding real estate and construction practices
Legal Update - Building Safety Act
The Building Safety Act 2022: Managing risks for private equity investors and acquirers
Press Release
Browne Jacobson bolsters Real Estate team with two partner appointments
Opinion
Publication of The Renters’ Rights Bill: Major changes to the private rented sector are on their way
Legal Update
ASA bans “misleading” Huel and ZOE ads endorsed by Dragon’s Den Star
Opinion
Choose your words wisely: Balancing inclusivity and employees’ beliefs at work
Guide
Guidance for manufacturers of EVs and HEVs in the UK: ASA's non-exhaustive electric vehicle advertising guidance
Press Release
Browne Jacobson advises Howard Farms on phased sale of Mulberry Logistics Park site
Legal Update
Future-proofing real estate: The rise of green leases
Legal Update
(Deep)fake it till you make it? The ASA's role in regulating false celebrity endorsements
Press Release
Browne Jacobson advises Montagu Evans on integration of its UK property management services into Savills
Published Article
The future of devolution: How a Labour majority could redefine local powers in England
Press Release
General election reaction from Browne Jacobson’s real estate team
Press Release
Browne Jacobson strengthens Irish Corporate team with appointment of Principal Associate James Byrne
Legal Update
Multi-occupancy building insurance: Latest tribunal decision
Legal Update
The benefits of good governance in sport
Press Release
Browne Jacobson appointed as legal adviser to major housing and care provider Sanctuary
Legal Update - Building Safety Act
Case update: Secretary of State for Levelling Up, Homes and Communities v Grey GR Limited Partnership
Opinion
Good news for landowners with appeal allowed under the Electronic Communications Code at the Upper Tribunal
Press Release
Browne Jacobson to lead discussions on the future of real estate and infrastructure at this year’s UKREiiF 2024 event
Press Release
Browne Jacobson acquires business of real estate practitioner Paul Taylor Solicitors
Legal Update
The Baltimore bridge collapse: One of the biggest losses in maritime insurance history?
Legal Update
Understanding the ICO's new fining guidance
Legal Update
Unravelling the challenges and opportunities in UK sports governance
Legal Update
JCT 2024: What’s new? An overview of the changes
Press Release
Browne Jacobson advises Greater Manchester Combined Authority on its investment in Beryl
Legal Update
ASA ruling on Calvin Klein FKA Twigs advertisement
Press Release
Browne Jacobson successful for National Lottery in Court of Appeal
Opinion
Caregivers at work: Navigating new carer's leave regulations
Opinion
EHRC publishes new guidance on menopause and the workplace
Opinion
Regulator warning on future dangers of asbestos
Legal Update
Welsh Government inks new regulations for Acupuncture, Body piercing, Electrolysis and Tattooing
