In Yorkbrook [1985] L’s service charge obligations were ‘subject to the receipt by L of the maintenance contribution from T’. Despite that, T’s obligation to pay the service charge was held to be independent of L’s responsibility to maintain the premises; thus, L had to carry out maintenance even though T was in arrears.

In contrast, in Bluestorm [2004] L’s performance of maintenance, etc was ‘subject to T paying the maintenance contribution’. L successfully sued for non-payment of the service charge, but T’s counter-claim for damages (because of L’s failure to provide the services) failed. The court took the view that T’s wilful refusal to pay had caused L’s inability to perform, and thus T’s claim was cancelled out by the damages to which L was entitled. At the same time, the court cast some doubt over Yorkbrook [1985] by pointing out that the words in that case (‘subject to’ these payments) must have had some meaning and yet the court decision gave them no effect. Thus, Bluestorm can be seen as undermining Yorkbrook to a limited extent. But, overall the position does seem to be clear: L’s obligation to maintain and provide services will generally be regarded as independent of T’s obligation to pay the service charge. Thus, a failure by T to pay will not normally entitle L to cease maintaining or to cease providing services. Having said that, as always, it depends upon the precise wording of the lease – although in Yorkbrook the wording was quite clear that L’s obligation was ‘subject to the receipt… of the maintenance contribution from the T’, and yet that was not sufficient to prevent L’s obligations from continuing. Whilst it may be that Yorkbrook is a dubious decision, it will be a brave L who ignores it. For further commentary see [2007] EG 24 March 149.  © Practical Lawyer