The measure of Success …… or Failure?

Valuations involve measuring a property and this is standardised according to the RICS Code of Measuring Practice (5th edition). This code is not mandatory but provides a quality assurance with succinct and precise definitions on a common and consistent basis. This is why it is often quoted in lease documentation.

Premises in Fleet Street  were to be used as a city centre supermarket and convenience store for Safeway. The claimant developer was to provide the defendant with a basic shell of 1852.7 sq m. Net Internal Area (NIA) as part of an agreement for a 25-year lease.

The scheme did not fit into the Morrisons concept when they took over and they sought to break the deal on the basis that the net area was not provided.

The question at stake rested on the meaning of what was included in  “useable area” as defined in NIA within the code. Was this all the area capable of use according to the claimant or did these exclude areas, which had undue restrictions as put forward by the defendants?

The Court (*see below) allowed the claim emphasising the definition was on the usability of the area, which need not just include floor area but other areas capable of use.

Solicitors should check with valuation surveyors the precise wording of any draft leases so that this is consistent with the needs and wishes of the client. The code is also an opportunity for solicitors to provide the clearest and succinct advice for their client in conjunction with the surveyor.

*The case Kilmartin SCI (Hulton House) Ltd v Safeway Stores  [2006] EWHC 60 (Ch)

This is part of a regular series of articles intended to be of topical interest. If you would like any further information or add your own comments please reply to this e mail or contact Roger Nelson on 0800 902 0466