A disgruntled tenant challenged an "expert" surveyor's rent review decision on the basis that it erred in law. The tenant argued that the surveyor had asked the wrong questions and the decision therefore, should not be binding. The surveyor had been appointed pursuant to the terms of the lease which stated that disputes would be referred to the expert whose decision was to be final on both fact and law. The court had "no hesitation" in agreeing with the Landlord that the expert's decision was final, conclusive and not open to review.
It is important that parties to leases include an appropriate mechanism in the lease to resolve disputes. If disputes are referred to a surveyor to act as an "expert", that decision cannot be challenged. This is often the most appropriate mechanism in transactions where it is a benefit to both parties that disputes are resolved relatively quickly at low cost. For more complex and higher value transactions in may be more appropriate to allow the parties to enter into arbitration and be able to challenge any determination. If parties want decisions to be open to challenge then the lease should allow for disputes to be arbitrated. Most importantly, parties should understand what they are agreeing to if they agree to "expert" determination.
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