What happens if a leasehold pharmacy is damaged or destroyed by an uninsured risk? Most pharmacy leases explain who is responsible for repairing damage and who pays any excess and/or shortfall in insurance following damage caused by an insured risk. Unfortunately, leases often do not detail the position where damage or destruction is caused by something that is not insured against “uninsured damage”.
Unless there are specific provisions setting out what happens following uninsured damage, a pharmacist may not only find themselves responsible for the cost of reinstatement, but might also have to continue to pay the rent, service charge and any other sums due under the lease, even though the pharmacy cannot be used. When buying an existing lease, taking on a new lease or renewing a lease, pharmacists should therefore negotiate the following into the agreement:
Failure to deal with uninsured damage at heads of terms stage could be costly to a pharmacist in terms of money and time.
The above is a general overview and we recommend that independent legal advice is sought for your specific concerns.
Michelle Noble is a solicitor and member of the pharmacy transactions real estate team at Charles Russell Speechlys LLP, email@example.com