Q&As

The landlord of a suite of offices plans to replace the air-conditioning units. The leases oblige the tenants to make on account service charge payments on the usual rent payment dates. Can the landlord require on account payments in respect of the air-conditioning works or must it incur the cost itself and seek reimbursement at the end of the service charge year? Is the landlord obliged to warn the tenants that there will be a shortfall between the on-account payments and the reconciled sum?

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Produced in partnership with Helen Galley of XXIV Old Buildings
Published on LexisPSL on 12/12/2018

The following Property Q&A produced in partnership with Helen Galley of XXIV Old Buildings provides comprehensive and up to date legal information covering:

  • The landlord of a suite of offices plans to replace the air-conditioning units. The leases oblige the tenants to make on account service charge payments on the usual rent payment dates. Can the landlord require on account payments in respect of the air-conditioning works or must it incur the cost itself and seek reimbursement at the end of the service charge year? Is the landlord obliged to warn the tenants that there will be a shortfall between the on-account payments and the reconciled sum?

The landlord of a suite of offices plans to replace the air-conditioning units. The leases oblige the tenants to make on account service charge payments on the usual rent payment dates. Can the landlord require on account payments in respect of the air-conditioning works or must it incur the cost itself and seek reimbursement at the end of the service charge year? Is the landlord obliged to warn the tenants that there will be a shortfall between the on-account payments and the reconciled sum?

The question is whether the landlord of commercial property can seek to recover the estimated costs of the replacement of the air-conditioning units in the building from the tenants by way of on account payments in relation to service charge or must actually incur the costs first and seek to recover the cost at the end of the year.

The answer will depend mainly on the terms and proper construction of the service charge

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