2 Maintenance and Repair of Fixed Equipment: the ‘Model Clauses’

6.63 The Agricultural Holdings Act differs from other protective legislation in that it lays down standard terms as to the repair, maintenance and insurance of fixed equipment (including buildings) that apply unless the parties have otherwise agreed.

6.64 The predecessor to the 2015 model clauses, the Agriculture (Maintenance, Repair and Insurance of Fixed Equipment) Regulations 1973, remain in force for the time being in Wales until replaced and updated.¹⁰⁹ Both will therefore be covered in the discussion below. It should also be added that the 1973 Regulations may still be relevant, also, to establish the repairing obligations in a farm business tenancy where the latter has expressly incorporated the 1973 model clauses, but without providing an interpretation clause that allows for any updating or replacement of the 1973 Regulations.¹¹⁰

6.65 The underlying principle applied by the model clauses is that the landlord should be liable for the structural integrity of fixed equipment through maintenance, repair and insurance against fire, and the tenant should be liable for day-to-day maintenance and repair of equipment and its operational components. The 2015 Regulations updated the model clauses to deal with a variety of types of fixed equipment now in common use – such as central heating, silage and slurry systems, power and heating generation systems (for example wind turbines and solar panels).

(a)Principles of incorporation

6.66 The model clauses are deemed to be incorporated into every contract of tenancy of an agricultural holding ‘except in so far as they would impose on one of the parties to an agreement in writing a liability which under the agreement is imposed on the other’.¹¹¹ They will, for instance, apply where there is an oral agreement. The policy of the legislation is to promote certainty by ensuring that the obligations of the parties in respect of fixed equipment are clearly expressed either in a written agreement (eg the tenancy) or in the regulations. Where there is a written agreement that incudes some, but not all, of the matters enumerated in the model clauses, the latter therefore fill the ‘gaps’ in the agreement – and in so doing promote certainty in the obligations as between landlord an tenant for the maintenance and repair of fixed equipment.

6.67 The principle of freedom of contract is preserved by excluding the model clauses where the tenancy agreement makes contrary provision. Nevertheless, the 1986 Act also seeks to promote the standardisation of repairing obligations by providing¹¹² that where the terms of a tenancy agreement substantially modify the operation of the model clauses either party can request a variation so as to bring the tenancy into conformity with the latter – and they can (if agreement cannot be reached) refer the contested terms to arbitration. The arbitrator’s duty¹¹³ in this event is to consider whether the terms concerned are justifiable having regard to the circumstances of the holding, and the circumstances of both landlord and tenant (but without reference to the rent). If satisfied that the terms concerned are not justifiable, the arbitrator can vary them ‘in such a manner as appears to him to be reasonable and just as between the landlord and tenant’.

6.68 Where an arbitrator’s award¹¹⁵ (or the agreement of the parties) shifts liability for repair and maintenance from one party to the other, s 9 enables any dispute as to prior failure to carry out repairing obligations to be decided at the date of the variation of the tenancy (and not it’s later termination) by reference to arbitration.¹¹⁶ Where a variation of the tenancy agreement as to fixed equipment is brought about by the introduction of new model clauses by regulation,¹¹⁷ an arbitrator is empowered, for a prescribed period of 3 moths from the new model clauses coming into effect, to disregard the variation when settling the terms of the written tenancy agreement on a reference under s 6.¹¹⁸

6.69 The principles governing incorporation of the model clauses were considered in Burden v Hannaford.¹¹⁹ The court of appeal considered the breadth of the proviso excluding the model clauses where ‘they would impose on one of the parties to an agreement in writing a liability which under the agreement is imposed on the other’.¹²⁰ The tenancy agreement in this case expressly relieved the tenant of liability to repair hedges and fences – an obligation the model clauses otherwise impose on tenants. It was held that any inconsistency between the tenancy agreement and the model clauses must be resolved by giving effect to the express contractual term. The model clauses were incorporated, as there was no positive obligation to fence at variance with the regulations. But reading the contract of tenancy and model clauses together, the former prevailed – with the (surprising) result that neither party was liable to repair hedges and fences.

(b)The 1973 Model Clauses

(i) Structural and exterior repairs and replacements

6.70 The 1973 model clauses placed liability for most repair and replacements of a structural nature on the landlord, and contain detailed clauses to govern the liabilities of the latter where the tenancy agreement is silent.¹²² The general repairing covenant for structural repairs imposed on many landlords by the Landlord and Tenant Act 1985¹²³ does not apply to agricultural holdings.¹²⁴

6.71 Under the 1973 model clauses the landlord is obliged to execute all repairs and replacements to both main and exterior walls and roofs of farmhouses, cottages and farm buildings, including walls and fences of open and covered yards. This obligation extends to interior decoration and repair made necessary by structural defects to floors, walls, roofs, ceiling joists and timbers. Liability is also placed on the landlord for repair of items such as exterior and interior staircases and ladders, doors, windows and skylights (excepting glass). The obligation is qualified in that, in the case of repair to floorboards, staircases, ladders and windows, and guttering, the landlord can recover one half of the reasonable cost of the work from the tenant.¹²⁵ The landlord is placed under an additional obligation¹²⁶ to paint and/or treat with preservatives all outside wood and ironwork of the farmhouse and other buildings at least once every five years.

6.72 In addition to the farm buildings, the landlord is under a duty to execute repairs/replacement to any underground water pipes, wells, bore holes and reservoirs, together with ancillary underground installations.

(ii) Non structural repairs

6.73 The primary obligation imposed by the 1973 model clauses on the tenant is to ‘repair and keep and leave clean and in good repair, order and condition’ the farmhouse, cottages and farm buildings together with any fixtures and fittings on land or buildings, except in so far as structural repairs are imposed by the regulations on the landlord.¹³⁰ This obligation is extended to replacement and repair of all items of fixed equipment if this is rendered necessary by his own wilful negligence or his failure to repair it.¹³¹ Because the tenant’s general liability is to keep and leave in good tenantable repair buildings and fixed equipment, it has been held that it will not suffice to leave buildings or equipment in as good a condition as they were at the beginning of the tenancy.¹³² However, it was there indicated, also, that when considering whether the obligation with regard to any particular item has been discharged regard should be had to its age and character, and its condition at the commencement of the tenancy. The time available to the tenant to effect repairs will also be relevant.¹³³

6.74 The tenant’s general obligation to repair the interior of the farmhouse and farm buildings is supplemented by a further obligation to clean, paint and/or treat with preservatives at least every seven years the inside of the farmhouse, cottages and farm buildings, including doors and windows.¹³⁴ He is also liable to replace slipped and cracked tiles and slates, but only in so far as the cost doing so does not exceed £100 in any one year of tenancy.¹³⁵ On termination of the tenancy, the tenant must pay a proportion of the cost of painting, calculated by reference to the period since it was last effected, or alternatively the reasonable cost of effecting the work, whichever is less.¹³⁶

(c)The 2015 Model Clauses

(i) Reform Proposals

6.75 DEFRA carried out a consultation on reform proposals in 2014, prior to the introduction of the new model clauses in 2015.¹³⁷ The DEFRA consultation posited introducing new liabilities to reflect modern farming methods and equipment, producing a more pragmatic allocation of liabilities between landlord and tenant, and increasing or removing the monetary caps on recovery of costs as between landlord and tenant.

6.76 Among the new liabilities that it proposed were liabilities for:¹³⁸

(a)Reed beds (landlord to repair/replace, tenant to keep clear and in good working order).

(b)Slurry, silage and effluent systems (landlord to repair and replace, tenant to keep clean and in good working order.

(c)Fixed equipment generating electricity/heat/power, eg solar panels, heat pumps and wind turbines (landlord to replace, tenant to repair).

(d)Fuel, oil tanks, gas pipework and fixed liquid petroleum and gas tanks (landlord to replace, tenant to repair).

(e)Fire, carbon monoxide, smoke and similar detection systems (landlord to repair and replace, but with provision for the tenant to repair and replace and then recover reasonable costs).

(f)Insulation including roof, wall and pipes (landlord to replace, tenant to repair).

(g)Livestock handling systems and sheep dips (landlord to replace, tenant to repair).

(h)Flood banks (landlord to repair and replace).

(i)Tiles and pipes for field drainage systems (landlord to repair and replace, tenant to keep field drains and their outlets clear from obstruction).

6.77 Provision should also be made for the tenant to repair and replace any signs or notices erected or displayed on the holding.

6.78 The consultation also recommended the expansion of the definition of main and exterior walls to include structural frames, cladding and interior plaster, liability for the replacement and maintenance of which would fall to the landlord. Electrical supply systems including consumer boards should be the responsibility of the landlord to repair and replace, but with the tenant having liability for switches sockets and light fittings.¹³⁹ The proposals also suggested expanding the definition of boilers to include central heating systems, immersion heaters, heating apparatus and ranges, with the liability allocated to the landlord to repair and replace. It was also recommended that the limits on recovery by the tenant of the cost of replacing slipped or cracked roof tiles should be increased from £100 to £500, and the cap on recovery of replacement costs should be removed altogether and the process for recovery aligned with that for repairs.¹⁴⁰

(ii) Rights and Liabilities of Landlord (Part 1)

Repair and Replacement of Fixed Equipment

6.79 The 2015 model clauses allocate responsibility to the landlord to repair or replace the following parts of the farmhouse, cottages and farm buildings, namely:

Roofs, bargeboards, fascias and soffits, eaves guttering and downpipes; chimney stacks, chimney linings and chimney pots; main walls and exterior walls, however constructed, including structural frames and cladding; interior repair or decoration made necessary as a result of structural defect to the roof, bargeboards, soffits etc or chimney stacks, linings or chimney pots; walls and fences of open and covered yards and garden walls; floors and floor joists; ceiling joists and timbers; exterior and interior staircases and fixed ladders (including bannisters or handrails) of the farmhouse and cottages; doors, windows and skylights and their frames and sills but not door and window furniture including sash cord, locks, fastenings and glass and glass substitute unless the repair or replacement of glass or glass substitute is a consequence of the condition of the doors, windows, skylights or their frames; roof and wall insulation; and fireplaces, fire backs and firebricks.¹⁴¹

6.80 The landlord must also repair and replace a number of specified features of water and drainage systems, namely: underground water supply pipes, wells boreholes, reservoirs and connected underground installations (but excluding removable covers and tops); sewage disposal systems (including septic tanks and cess pools); reed beds for water and sewage treatment; and silage, slurry and other effluent systems excluding anaerobic digesters (again excluding removable covers and tops).¹⁴²

6.81 The 2015 model clauses also place the liability for repair and replacement of a number of gas electricity and safety detection systems on the landlord. These are: gas pipes, fixed liquid petroleum and gas tanks; the electrical supply system including the consumer board (but excluding sockets, switches light fittings and ‘similar electrical furniture’); and fire and carbon monoxide detectors and alarms.¹⁴³ In respect of the electrical supply system the landlord is under an obligation to have the system regularly inspected, maintained and serviced, to keep full records of any work carried out and to make the records of any work carried out available to the tenant should s/he request to see them.¹⁴⁴

6.82 The landlord is under a general obligation to replace anything that falls within the tenant’s liability to repair (as to which see below), if the item has worn out or become incapable of further repair. This obligation does not apply if the tenant is under a duty to replace it as a consequence of his/her wilful act or negligence.¹⁴⁵

Insurance

6.83 The landlord must insure the farmhouse, cottages and farm buildings to their full value against loss or damage by fire. And where any of the farmhouse, cottages and farm buildings, or any part of them, is damaged or destroyed by fire the landlord must: (i) execute all repairs and replacements to make good such damage or destruction; and (ii) cause all money received from insurance entered into in respect of such damage or destruction to be expended on those repairs and replacements.¹⁴⁶ The landlord is unable to recover half of the reasonable costs of repairs and replacements following fire damage or loss, if it falls within (ii) above.¹⁴⁷ As we shall see, in other situations the landlord can recover up to 50% of the cost of repairs and replacements under the 2015 model clauses.

Maintenance of Fixed Equipment

6.84 The landlord must paint, decorate or treat, as appropriate, to a proper standard using materials of suitable quality at intervals of not more than five years or whenever necessary to prevent deterioration, the following (which have been previously painted, decorated or treated or which it is necessary to paint, decorate or treat to prevent deterioration): (i) all outside wood and ironwork of the farmhouse, cottages and farm buildings; (ii) the inside wood and ironwork of all external outward opening doors and windows of farm buildings; and (iii) interior structural steelwork of open-sided farm buildings.¹⁴⁸

6.85 The landlord is under no liability to repair, replace or insure buildings or fixtures that are the property of the tenant. This includes buildings or fixtures erected or provided by the tenant during the tenancy. Neither is the landlord liable to execute repairs or replacements rendered necessary by the willful act or the negligence of the tenant or of any of the tenant’s household members or employees.¹⁴⁹

6.86 The landlord may recover from the tenant one-half of the reasonable cost of repairs or replacements executed under the 2015 Regulations to some structural items.¹⁵⁰ These are: bargeboards, fascia and soffits, eaves guttering and downpipes; to floorboards; to interior staircases and fixed ladders (including bannisters or handrails); and to doors, windows and opening skylights and their frames and sills (including glass or glass substitute repaired or replaced as a consequence of the door, window, skylight and frame repair or replacement). Similarly, the landlord can recover from the tenant one-half of the reasonable cost of external painting and decoration.¹⁵¹ The only restriction here is that if the work is completed before the expiry of the fifth year of the tenancy, then the amount the landlord can recover is restricted to an amount equal to the total of one-tenth part of such reasonable cost for each year that has elapsed between the commencement of the tenancy and the completion of the work to: (i) bargeboards, fascia and soffits, eaves-guttering and downpipes; and (ii) doors and windows. If there is a dispute as to liability, then the right to recover the cost does not arise until the question of liability has been established by arbitration, or by third party determination, in which event the right of recovery arises from the date the arbitrators award, or third party determination, is delivered to the tenant¹⁵²

(ii) Rights and Liabilities of the Tenant (Part 11)

Repair and Replacement of Fixed Equipment

6.87 The 2015 Model Clauses provide that the tenant must repair and leave clean and in good tenantable repair, order and condition the farmhouse, cottages and farm buildings together with the following (which are in or upon the holding, or which during the tenancy may be erected or provided upon the holding)¹⁵³:

Fixtures and fittings; space heating and water heating systems (including the repair of any boiler but not its replacement), ranges, grates; drains, sewers, gulleys and grease traps; manholes and inspection chambers; water supply systems and fittings situated above ground (including pipes, tanks, cisterns, sanitary fittings and drinking troughs), pumping equipment, and hydraulic rams whether above or below ground; fences, hedges, field walls, stiles, cattle grids, gates and posts, and garden and yard doors; bridges, culverts, ponds, watercourses, sluices and ditches; roads and yards; fixed equipment generating electricity, heat or power (including solar panels, heat pumps, wind turbines and anaerobic digesters) which is wholly for the use or benefit of the tenant; vehicle fuel and oil tanks; radon pumps; insulation on water pipes; and livestock handling systems and sheep dips.

6.88 The tenant must also replace or repair and leave in good tenantable repair order and condition door and window furniture including sash cords, locks and fastenings, glass and glass substitute, except for glass or glass substitute which requires repair or replacement as a consequence of the condition of the door, window, skylight or their frames. The tenant is also liable to repair or replace and leave in good tenantable condition all removable covers to any manhole, inspection chamber, sewage disposal system, slurry, silage or other effluent system (excluding anaerobic digesters), and also electric sockets, switches, light fittings (on or outside the surface of walls ceilings or floors¹⁵⁴), and signs or notices. The liability also extends to replacing all broken or cracked roof tiles or slates and all slipped roof tiles or slates, as the damage occurs: the liability here only extends to work that does not exceed £500 in any one year of the tenancy, however.¹⁵⁵

6.89 The tenant is also obliged to repair and/or replace any time of fixed equipment (and to paint or treat it with preservative as appropriate) ‘where such repair, replacement or work is rendered necessary by the willful act or negligence of the tenant or of any of the tenant’s household members or employees’.¹⁵⁶ Similarly s/he must replace any item that has become incapable of repair substantially by virtue of the tenant’s failure to repair it.

Maintenance of Fixed equipment

6.90 The 2015 Model Clauses place liability on the tenant to carry out a wide range of maintenance to fixed equipment and moving parts.¹⁵⁷ S/he must: (i) keep clean and in good working order all roof valleys, eaves-guttering and downpipes, wells, septic tanks, cesspools, sewage disposal systems, slurry, silage and effluent systems excluding anaerobic digesters; (ii) keep clear and in good working order reed beds for water and sewage treatment; (iii) properly clean, paint or otherwise treat with materials of suitable quality the inside of the farmhouse, cottages and farm buildings, including the interior of outward opening doors and windows of the farmhouse and cottages, which have been previously so treated, whenever necessary, and in any case at intervals of not more than seven years; (iv) in the last year of the tenancy to lime wash the inside of buildings previously lime washed; (v) dig out, scour and cleanse all ponds, watercourses, ditches and grips as necessary to maintain them at sufficient width and depth; and (vi) cut, trim and lay a proper proportion of the hedges in each year of the tenancy to maintain them in good and sound condition.

(d)Remedies and enforcement

(i) Remedies under the Model Clauses

6.91 Where the model clauses apply, both the 2015 and 1973 regulations each provide a special procedure, designed principally to protect the tenant against costly legal proceedings but also to provide a speedier process to enforce repairs. The procedure for doing so is similar under both the 1973 and 2015 Regulations. The tenant can serve notice of disrepair, calling on the landlord to execute the repairs necessary to comply with the model repairing obligations.¹⁵⁸ The tenant can carry out repairs and/or replacements (other than to underground water pipes) if the landlord fails to execute the repairs specified in the tenants notice within 3 months of its receipt. S/he can carry out repairs to underground water pipes if the landlord does not carry the work out within 1 week of receiving notice from the tenant under the 2015 Regulations. Similar provision is made under the 1973 Regulations, and in either case if the landlord wishes to content his liability to execute any repairs or replacements specified in the notice, he must serve a counter notice within one month denying liability and referring the matter to arbitration.¹⁵⁹ If the obligation to repair is not challenged, and the landlord fails to carry out the necessary repair within 3 months of the tenant’s notice, both the 2015 and 1973 regulations empower the tenant to carry out the work himself and recover the reasonable cost of doing so from the landlord.¹⁶⁰

6.92 Similarly, the landlord can execute repairs that are tenant liabilities in some situations. Under both the 1973¹⁶¹ and 2015¹⁶² model clauses, the landlord can serve notice specifying the necessary works of maintenance replacement or repair to be carried out by the tenant. If the tenant does not commence work within 2 months of notice being served, and complete the necessary works within 3 months, then the landlord can enter and execute the repairs replacement or maintenance at issue. S/he can then recover the reasonable costs of doing so from the tenant. If there is a dispute as to liability, then the right to recover the cost does not arise until the question of liability has been established by arbitration, or by third party determination, in which event the right of recovery arises from the date the arbitrators award, or third party determination, is delivered to the tenant.¹⁶³

6.93 In any dispute arising under the 1973 model clauses ‘any claim, question or difference’ between the parties can be referred to arbitration in default of agreement.¹⁶⁴ In a case where a dispute arises under the 2015 model clauses, it can be referred either to arbitration, or to the determination of a third party.¹⁶⁵

(ii) Remedies under the General Law

6.94 Landlord and tenant can exercise the normal remedies for breach of covenant under the general law, whether repairing obligations are express or incorporated by the model clauses. Thus under the rule in Lee-Parker v Izzet¹⁶⁶ the tenant can deduct the reasonable cost of landlord’s repairs from rent prior to payment, provided notice of disrepair has been given. Likewise, an order for specific performance of landlord’s repairing covenants can be made in extreme cases, provided there is a clear breach of the repairing obligation and the court is of no doubt as to what needs to be done to remedy it.¹⁶⁷ Given the limitations on the tenants right to enforce the landlord’s obligations to repair under the 1973 model clauses, there have been a number of cases where tenants have sought to enforce repairing obligations under the general law. The decisions explore the inter relationship between the principles of liability in the general law and the terms of the model clause (including the financial limits on recovery that they impose). Although the cases discussed below were decided under the 1973 Regulations, there is no reason why in principle they should not also apply to determine issues arising in cases where the 2015 model clauses apply: although in these cases, the revision of the financial limits for recovery make the model clauses a more effective and speedy route for resolving disputes effectively, without recourse to the general law.

6.95 In Hammond v Allen,¹⁶⁸ the residual scope of the tenant’s remedies under the general law was considered. Substantial repair and replacement to farm buildings, at a cost of £35,000, were at issue. The tenant here served notice on 12 January 1990 requesting the landlord to make the required repairs. By a notice served on 1 November 1990, the landlord claimed the work involved improvements, not repairs, and claimed reference to arbitration. The tenant would, under the model clauses, have had the right to carry out the work himself and then claim reimbursement. He could not afford to do so, however, and so sued for specific performance of the ‘model’ repairing clause. It was here held that the landlord’s counter notice was invalid, because it was not served within the one month allowed. Having failed to contest liability in the manner provided for in the regulations, there no longer remained any ‘claim, question or difference’ between the parties under the model clauses, and on which arbitration could be claimed. Specific performance was therefore available to enforce the landlord’s repairing obligation, irrespective of the substantive merits of liability.

6.96 It follows that, if no counter notice is served, liability is conclusively presumed or found against the landlord at the end of the month following service of notice of disrepair. Furthermore, at the end of three months, the landlord loses his right to do the work and claim reimbursement. His liability vests, and can be enforced against him by an order of specific performance. The court refused to contemplate denying the tenant of this right by extending the period allowed to the landlord to challenge the tenant’s notice of disrepair. The availability of specific performance will be useful where a tenant has insufficient finance to carry out necessary repairs himself, and to seek reimbursement later, and gives the tenant a supplementary remedy in cases of serious disrepair. The decision also emphasises the importance to the landlord of serving a counter notice strictly within the month allowed by the regulations.

6.97 The scope of the general law remains limited, however, to cases where liability has been found (on arbitration) or conclusively presumed against the landlord. The tenant must choose to pursue his remedy under either the general law or the model clauses: he cannot do both. Hammond v Allen should be compared with the earlier decision in Grayless v Watkinson.¹⁶⁹ The tenant here, having given notice requiring the replacement of a barn roof, carried out the work himself (at a cost of £7,992) and sued to recover either the sum expended in full, or damages at common law. Paragraph 12(2) of the model clauses gives the tenant the right to carry out work of replacement if the landlord fails to do so himself within three months of being notified, and then to recover the ‘reasonable cost’ from the landlord. In the case of replacements, however, the amount recoverable in this way was limited by the 1973 regulations ‘in any year of the tenancy... to a sum equal to the rent of the holding for that year or £2,000.’ There is no limit on the recovery of costs of repairs. The Court of Appeal here held that the model clause was the sole source of the tenant’s right to recover. According to Dillon LJ. ‘The true position... is that para 12 (2) is the sole source of the tenant’s right to recover the cost of replacing the barn roof from the landlord, and the tenant must accept para 12(2) as a whole, including the proviso. The only liability of the landlord is a liability qualified by the proviso.’¹⁷⁰ On its true construction, however, the model clause was held to allow the tenant to claim up to £2,000 in successive years, until the cost of replacements has been covered. The crucial difference here was that the tenant had carried out the work prior to commencing proceedings.

6.98 The combined effect of the decisions in Hammond v Allen and Grayless v Watkinson is to present the tenant with an election. If the landlord fails to contest liability within the time allowed he can either sue for specific performance under the general law, or carry out the work himself and rely on the model clauses for recovery. If the work involves replacements (and not simply repairs) he will find his right to recovery limited to £2,000 pa in any case where the 1973 model clauses still apply.¹⁷¹ Where substantial replacement costs were involved, it could take many years to recoup the total cost under the 1973 model clause provisions (as interpreted in Grayless supra) – and in this case, the availability of specific performance was potentially important to the tenant. Where the cost of repairs alone were involved, the issues were more straightforward – the tenant could choose either to sue for specific performance, or to carry out the work and claim full reimbursement under the model clauses (no limit was placed on recovery of costs of landlord’s repairs). This will be less problematic where the 2015 model clauses apply, as there is now no limit on the recovery of replacement costs that are ‘reasonable’ on the facts.

6.99 A different problem arose in Tustian v Johnson.¹⁷² The landlords here had challenged the extent of disrepair, but put in no defence to claims for damages and specific performance of the 1973 ‘model’ repairing obligations. Grayless v Watkinson (supra) was distinguishable, because the tenant here had claimed specific performance – and specific performance is not available under para 12 or 15 of the 1973 model clauses. The facts did not infringe the rule established in Grayless, therefore, that ‘where the regulations apply to confer a remedy there is pro tanto an exclusion of common law remedies that overlap.’¹⁷³ However, the court discerned a second principle that underpins the regulations – there should be compulsory arbitration as to the extent and existence of breaches of the implied repairing obligations under the regulations. Until liability (or its extent) has been established by arbitration, the court will not entertain an action for specific performance or damages. The court therefore stayed the proceedings, pending an arbitration to clarify the extent of the landlord’s liability for the disrepair in issue.

6.100 It follows that, if the landlord challenges liability by giving notice under the 1973 regulations, a two-stage procedure must follow before specific performance can be awarded. The same principle will apply, it is suggested, where the 2015 model clauses are applicable. This highlights the importance to the landlord of challenging a notice of disrepair within the month allowed by the regulations. The Court of Appeal added a final complication in Tustian v Johnson by partially lifting the stay on proceedings – but only so as to allow proceedings for summary judgment against the landlord, on which the issues are broadly the same as in application to stay proceedings.¹⁷⁴

(e)Redundant Buildings

6.101 The model clauses also contain an arbitration procedure whereby buildings or fixed equipment can be declared redundant to the needs of the holding.¹⁷⁵ In this eventuality the parties are relieved from repairing obligations in respect of the items concerned under the model clauses, and from any prior breach of obligation. The procedure is initiated by either party serving two months’ notice requiring arbitration as to the redundancy of the equipment, in default of agreement. The arbitrator’s remit here is broad, the regulations directing him to have regard to the landlord’s responsibility to manage the holding in accordance with the rules of sound estate management, the length of time for which the holding may reasonably expect to remain separate, and both the character and situation of the holding and the needs of a tenant reasonably skilled in husbandry. The equipment must be redundant to the needs of the holding, and not simply aged or obsolete.