By Mashe Umaru Gwamna
An Estate Surveyor and Valuer, ESV. Kenechukwu Patrick Okeke, said Terminal redecoration deposit is very important to lessee in management of leased properties lease in the Nigeria .
ESV Patrick Okeke made the disclosure in Abuja yesterday.
He explained that “Lease is an arrangement between two parties, lessor and the lessee by which the lessor transfers the right to use the demised property within the agreed lease period to the lessee in exchange for rent .
He said this is in accordance with the specified terms of the lease agreement whether implied, expressed lease agreements is the legal binding contract outlining the terms under which both parties, the lessee and the lessors rights, obligations and liabilities are articulated and spelt out.
He however stated that, in some cases some tenancy terms and obligations can be implied, expressed in writing.
“Our major concern for today will be narrowed down to repair obligations in a lease contract”.
Obligation, Repair Clause Agreement
He said this kind of lease agreement provides lessees, tenants to have to keep the property in good repair, appropriately put full repairing lease’ meaning that the Tenant has full responsibility for repair of the property at their own cost at the determination of lease.
“ This repair clause pre-supposes either impliedly or expressly of the lessor obligation to must put the property in good repair condition before the lease.
It therefore beholds on the prospective lessee to carry out pre-entry inspection and well documented inventory taking and checklist before taking possession and also before entering into the full repairing lease contract”.
Reasons for Default in the Obligation
He emphasized that ignorance is one of the major reasons for default in this lease obligation, being ignorant is not an excuse by the law . “Omission of repair clause in Lease agreements”.
According to him, “Most often tenants lack full knowledge on this rational and incur cost after payment of rents in the duration of the lease”.
He said “Most leases ends up in a bad taste due to one reason or the other especially in failing on obligations by either or both parties.
Poor enforcement processes, duration time and cost is involved too “.
Need, Justification for Redecoration and Handling
The Surveyor reiterated that because most tenancies in Nigeria does not end well coupled with most tenants’ poor mentality of not taking the repair clause as priority, this calls for a pro- active device of means by property defaults. Managers to curb the adverse effects of these and that is introducing what we call “Terminal re decoration Deposit “, he said.
“This should be introduced at the inception of a lease contract. It is a well-articulated budget of cost of redecoration and projected repairs on the property and the tenant is made to pay the deposit at the onset of the lease”.
Benefits of Deposit to the Tenant and the Landlord to the Tenant
He noted that, “This reduces the burden of liability at the end of the tenancy.
The money or deposit remains his damages on the property are established and repairs effected.
“He may get balance refund if the deposit is not exhausted.
He will be fully carried along in the spending of the deposit in carrying out the repairs.
While the deposit is put down, it is not meant to be used by the property manager rather to be invested to yield interest during the duration of the lease.”
He said “In other words, the amount deposited is increased by yielding interest.
It also enables the tenant to exercise care and caution in the use of the demised property knowing fully well the onus of repair lies with him”.
To the Property, the Owner and the Property Manager
He said the property is handled with improved care and further preserve.
“The owner is less worried over cost of repairs at the determination of the lease.
The property manager is less burdened with unnecessary litigation to effect enforcement of obligation to repair.”
He also eliminates unnecessary rancour between the property owner and the property manager especially as concerns competence and professionalism.
“It reduces void period on the property given that maintenance is carried out immediately possession is yielded.
The full rental values realized on the property is not reduced if the owner has to carry out repairs at the expense of the tenant”.
He said, It will also improve the general harmonious relationship between all the parties to the lease contract.
He concluded by saying that given the pros and cons of this proactive pleasure of introducing the terminal redecoration deposit, we are convinced that effective property management is enhanced.
