HP sues over bill for #400,000

Manufacturer takes management companies to High Court over lease

Hewlett Packard (HP) is suing two management companies for damages after having to pay more that #400,000 to escape from a property lease, after failing to paint a fire escape.

According to a High Court writ, HP is suing project manager Rose Project Services and property portfolio managers, chartered surveyor Weatherall Green & Smith. The action centres on a London property which HP leased from Brixton Estate in July 1990, for an annual rent of #107,000.

In 1994 its managing agents Weatherall Green & Smith, advised that HP was paying too much and entered into negotiations with Brixton to renegotiate the terms of the lease. It later advised HP to break the lease, which was done on 23 June 1995. Breaking the lease meant HP had to ensure the building was suitable.

Rose Project Services provided a schedule of dilapidations, estimating works at about #20,000 plus VAT. But after the work was carried out, Brixton maintained that HP had not complied with conditions in the lease, claiming the lease was invalid, and that the lease continued in full force and effect.

HP started High Court proceedings in 1995, seeking a declaration that the lease was terminated from 23 June 1995. Brixton counterclaimed that the lease had not been determined and was still in full force, and alleged rent arrears were due on the grounds that HP had failed to paint all exterior metalwork during the past year.

HP settled the action with Brixton, paying #400,250, and undertaking to bear all outgoings on the property between 24 June and 19 December 1996. But the manufacturer is now claiming that Rose Project Services was negligent.