The alterations trap

The Problem
The lease contains an absolute prohibition on alterations. Can the tenant carry out any alterations? Yes, No, Maybe......

Whilst the logical answer is no, the correct answer is, in fact, maybe. There are three little known provisions which may entitle the tenant to apply to the Court to modify the covenants in the lease relating to alterations.

The Law
The Fire Precautions Act 1971 enables the Court to modify the covenants in the lease and to apportion the expense of carrying out fire prevention works required under this statute. Whilst the terms of the lease will be taken into account, the Court will exercise its discretion to make such an order as is just and equitable and the terms of the lease will not necessarily be conclusive.

The Offices Shops & Railway Premises Act 1963 also allows the Court to modify the covenants in the lease if it prohibits alterations required to comply with the Act.

The Disability Discrimination Act 1995 inserts an implied term in the lease to the effect that consent to any alteration by an employer with at least 15 employees required to comply with the statutory obligation to take reasonable steps to prevent the physical characteristics of the workplace acting to the substantial disadvantage of disabled people will not be unreasonably withheld.

Conclusion
Landlords should not assume that they can take action for breach of covenant or refuse consent without considering the impact of these provisions. Tenants should consider whether they can challenge a refusal or absolute ban by virtue of the statutory provisions.