What Constitutes a Change of Layout?

The question of just how far a lessee can go in altering the layout of a property without either the landlord’s consent or breaching other terms of the lease can be a vexing one. The 2006 case of Waycourt Ltd. v Viscount Chelsea looked at the issue of what constitutes a ‘change of layout’ for the purposes of a prohibition on changing the plan or internal layout of premises under a lease.

The property in point consisted of two substantial terraced houses, in Sloane Gardens, which had been divided into flats with a basement area comprising a caretaker’s flat and two subterranean storage vaults. The basement flat consisted of a kitchen-diner, a bedroom and a bathroom. The flat was too small for the caretaker and her family and so her husband altered the premises, converting the two vaults into a kitchen and dining area.

There was a complaint by the landlord that the caretaker had altered the layout of the basement by the conversion works and that this was in breach of the lease. The caretaker claimed that the landlord’s consent had been unreasonably withheld and that she had not herself been in breach of the covenant ‘not to alter the plan layout height or elevation of the demised premises’.

The Court of Appeal agreed with the judgment of the lower court, which ruled that the change in the internal arrangement of the premises did constitute a change in layout and that the caretaker was in breach of the covenant in her lease.

Tenants who are considering making internal alterations to their premises, such as removing walls or making new door openings, should take this decision as a warning to ensure that they are within their legal rights before undertaking building works.