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Archive for November, 2014

Game, set and match for landlords

In March 2014, we reported on the Court of Appeal case, Pillar Denton Ltd and others v Jervis and others [2014] EWCA Civ 180.  Not satisfied with the decision, the tenant’s administrators (whom, as the appropriate office holders, had been ordered to pay rent for any period of time property was occupied for the benefit of the winding up or administration) applied to the Supreme Court for leave to appeal.  Landlords held their breath.  The sigh of relieve was audible as the Supreme Court ordered that permission be refused there being raised no point of law of general public importance.  Be that the case or not, the consequence is that the Court of Appeal decision stands.

Hence, as held by Lord Justice Lewison, 

The true extent of the principle, in my judgment, is that the office holder must make payments at the rate of the rent for the duration of any period during which he retains possession of the demised property for the benefit of the winding up or administration (as the case may be). The rent will be treated as accruing from day to day. Those payments are payable as expenses of the winding up or administration. The duration of the period is a question of fact and is not determined merely by reference to which rent days occur before, during or after that period.

Interestingly, and as reported by us in May 2014, the Court of Appeal in the case of Marks and Spencer plc v BNP Paribas Securities Services Trust Company (Jersey) Ltd and anor [2014] EWCA Civ 603 had held that rental paid quarterly in advance of a break date was not apportioned on a day to day basis if the break date fell between quarter days and the full quarter’s rent fell due on the appropriate payment date.  The case was of course decided upon the facts and circumstances of the case and the particular wording of the lease in question.  In consequence, it is worth considering whether a differently worded lease might lead a judge to a different conclusion.  Watch this space?

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