Statutory Obligations Under Commercial Leases – Landlord & Tenant – Leases

Fire Risk Assessments and Asbestos Surveys

Legal requirements, known as statutory obligations, are often
imposed within commercial leases. Such obligations include the
non-exhaustive list of:

The question of whose responsibility these obligations fall to,
either the landlord or the tenant, will be determined by the terms
of the lease or that which has been laid down in legislation. It is
therefore important to understand who is responsible for these
provisions so that certain health and safety standards are
satisfactory. This article will focus on the common statutory
obligations of Asbestos Surveys and Fire Risk Assessments.

Asbestos Surveys

The Control of Asbestos at Work Regulations 2006 (2006
Regulation) impose a duty to manage asbestos in non-domestic
premises. The Regulations impose a legal duty on those that are in
control of the maintenance and repair of any part of non-domestic
premises to make an assessment (the Asbestos Survey) as to whether
asbestos is present or is likely to be present. If asbestos is
present, they are required to prepare a plan for managing the
health risks arising (the Management Plan) and keep this up to date
as necessary.

Within a standard full repairing commercial lease (FRI Lease), in which the tenant takes on all
of the costs for repairs and insurance for the property being
leased from the landlord , the tenant will usually be responsible
for managing asbestos within the premises. This is because the law
places the responsibility on the person that has the most control
over the premises. As tenants under FRI Leases have full repairing
and insuring responsibility it is then unlikely that the landlord
will manage the asbestos, especially where they do not have
occupation of the premises.

Accordingly, it is important that, before a tenant takes a
lease, an asbestos survey is obtained from the landlord, so as to
check whether there is any asbestos present within the premises and
if there is, what asbestos management the tenant will become
responsible for.

However, the responsibility under the 2006 Regulation for
managing asbestos within the premises may fall to the landlord.
Such a circumstance includes where the landlord has clear
responsibility for the maintenance or repair of the premises under
the terms of the lease.

Where there is no plan in place to deal with asbestos this will
breach the duty under the 2006 Regulation. This could cause a
breach of the lease and in more extreme cases punishments such as
fines and imprisonment may be applicable. It is therefore important
to determine who will be responsible for the asbestos survey under
the lease.

Fire Risk Assessment

The Regulatory Reform (Fire Safety) Order 2005 (2005 Order)
requires persons responsible for properties (except private
dwelling houses) to prepare a Fire Risk Assessment. The
‘responsible person’, as with the asbestos survey above,
will be any person who has control of the premises.

Where the lease in question is a FRI Lease of whole, the tenant
will likely be the responsible person assuming that they have
control of the premises. This will mean that the tenant is
accountable for responsibilities such as:

• Carrying out the risk assessment




• Ensuring that the premises and any fire safety equipment are
  kept in working order




• Determining whether there are sufficient emergency exits and
  procedures in place




• Providing any necessary fire safety training any employees

As long as the lease is in effect, the tenant’s
responsibility for the Fire Risk Assessment will not extinguish
when the tenant vacates the premises. As such, it is recommended
that a Fire Risk Assessment should be obtained before a tenant
commits to a new lease in case works to the premises are required
to satisfy the specifications of the 2005 Order.

However, the landlord may be considered the ‘responsible
person’ where they have an obligation in respect of maintenance
or safety within the lease terms, or where they have control over
the premises. Such control might include the landlord’s
capacity to access the premises to carry out any maintenance or
repair works under the lease. Furthermore, where the demised
premises has multiple lettings, the landlord may be responsible for
the common areas. It should also be noted that the landlord may
take back control of the premises from the tenant where the lease
is surrendered or forfeited.

Where the Fire Risk Assessment responsibilities under the 2005
Order are not satisfied, depending on the severity, this could
result in a breach of the commercial lease, fines, and in extreme
cases even prison. As such, it is important to understand who under
the lease is the ‘responsible person’.

Conclusion

There is a vast range of health and safety commitments under
leases which are imposed by statutory obligations. A breach of
these obligations may result in consequences for the responsible
party. Accordingly, whether you are a landlord granting a lease or
a tenant taking a lease, it is important to understand who under
the lease has control of the premises as they may be responsible
for statutory obligations such as the Asbestos Survey and Fire Risk
Assessment.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.