The Rugby club, known for its facilities, faced a Covid-era-related dispute with another party regarding the maintenance of its facilities. This case, typical of pandemic-related claims, involved contractual obligations, cost accumulation, and force majeure considerations.

To find our more, or how our Dispute Resolution team can help you, contact Paul Marmor. 

This ambitious expansion was flawlessly orchestrated through a strategic alliance with the Commercial Property team at Sherrards, under the guidance of Terry Fendt.

PLAYGROUND Brand’s Dance Legacy Broadens Its Horizon. Boasting acclaimed studios in LA, Playground London stands as the newest addition to the illustrious PLAYGROUND Brand, gearing up to offer master classes and dynamic daily sessions helmed by industry-leading choreographers.

Seamless Expansion: Thanks to the diligence and expertise of the Commercial Property team, Playground LA Limited secured a smooth lease agreement, culminating in a mid-July completion. With eager anticipation, PLAYGROUND LONDON is poised to swing its doors open on Oct 2nd!

Frequented by stars like Jennifer Lopez and Justin Bieber, and associated with brands such as Nike and Adidas, Playground LA’s legacy is set to continue in London. Dive into the PLAYGROUND brand and check out PLAYGROUND LONDON.

We asked Chris Hovington, Group Leasing Manager at Praxis Real Estate Management to sit down with us and talk about working alongside the teams at Sherrards.

Thanks to Chris for taking the time to speak about our Commercial Property teams whom he has worked with for over twenty years.

He says, “We work with Sherrards as often as we can.”

We say “The feeling is mutual!”

Erin, a trainee solicitor in our Dispute Resolution team, explores the recent judgment in BMW (UK) Ltd v K Group Holdings Ltd highlighting the balancing act required in respect of a landlord’s business aspirations and a commercial tenant’s rights when negotiating break clauses in a lease.

Introduction

The realm of commercial leases is a complex landscape governed by legal provisions aimed at balancing the interests of both landlords and tenants.

One such provision that plays a pivotal role in commercial lease agreements is the break clause.

Break clauses in a commercial lease are provisions that allow either the tenant or the landlord to terminate the lease before its designated end date. These clauses offer flexibility within the lease agreement, allowing parties to adapt to changing circumstances or business needs.

However, a recent decision in the County Court highlighted the difficulties that landlords can face when seeking a break clause for their business needs in a renewal lease protected by Part II of the Landlord and Tenant Act 1954 (the Act).

BMW (UK) Ltd v K Group Holdings Ltd

The case concerned a car showroom in Mayfair, demised under four separate leases from the landlord, K Group Holdings Limited, to the tenant, BMW (UK) Limited.

These leases were subject to renewal proceedings under the Act and therefore, were to be granted on essentially the same terms as the previous leases.

The previous leases did not, however, contain a landlord break option. Accordingly, the onus was on the landlord to demonstrate the proposed terms were fair and reasonable and should be granted. 

If a break clause was to be included, the landlord accepted that it would have to prove a ground of opposition under s30(1) of the Act in order to exercise the break option.

HHJ Monty KC, in considering whether to grant a break clause, made it clear that the court must try and strike a balance “between granting a reasonable degree of security to the tenant on the one hand, and not preventing the landlord from recovering possession if one of the statutory grounds can be proved on the other”.

Section 30(1)(g) – Landlord’s intention to occupy the premises for the purpose of a business to be carried on by the landlord

The relevant ground in this case was ground (g), namely that on termination of the tenancy, the landlord intends to occupy the property for the purposes of a business to be carried on by the landlord.

The renewal leases themselves were unopposed and so it was for the landlord to prove that they would be able to establish ground (g) at some point in the future when exercising the break option. That is, the landlord needed to show a bona fide intention to operate the break clause if one was granted.

When giving evidence, the landlord agreed that a car business would be an entirely new business for K Group Holdings Ltd. It was further contended by the landlord’s witness that members of his family who controlled entities within the same group as the landlord were only a “little bit inclined to have a study and see the possibilities” of the electric car market. 

In this case, the landlord’s inadequate evidence and the effect the break clause would have on the tenant meant that the court found in favour of the tenant in refusing the inclusion of the landlord’s proposed break clause.

Practical considerations

This decision highlights the raising of the bar in respect of the landlord’s intention to exercise a break option, particularly where the landlord may have aspirations to start a new business venture or expand an existing one.

A landlord should ensure they can evidence a real intention that the operation of the break clause is more than a vague possibility. Therefore, evidence of any steps taken to progress the possibility of occupation for the purpose of a business would be worth documenting.

Although a complete and comprehensive business plan may not be required, the landlord should seek to substantiate any request for a break clause with supporting evidence detailing any “genuine and workable” intention to occupy the premises.

Sherrards’ Real Estate Litigation team

This article has been fact-checked and authorised by the Head of the Real Estate Litigation team, and Training Partner Michael Lewis. If you have any questions or thoughts, please reach out to him by clicking here.

Our Real Estate Litigation team can support you with an entrepreneurial, commercial and considered approach to break options to help you achieve your goals. Our specialist team can advise you on your options, including, where appropriate asking the court to determine the matter.

For advice and assistance, contact the Real Estate Litigation team at Sherrards.

Leading food manufacturer, Around Noon, has acquired the Soho Sandwich Company to create an enlarged group with 800 employees.

Partner in the Corporate & Commercial department at Sherrards Solicitors, Leigh Head, supported the Soho Sandwich Company through the acquisition alongside Senior Associate Emma O’Meara from our Employment department who dealt with the Employment aspects.

They worked alongside WMT Chartered Accountants, ensuring a smooth deal.  

Around Noon was created over 30 years ago in Northern Ireland, and is now one of the major food producers and distributors in the UK.

The company will remain to be overseen by its current Managing Director, Daniel Silverston, as the company will continue to operate under its own brand inside the Around Noon group.

Daniel Silverston announced the deal in London on the 7^th of June 2023, where the story has now been released on BBC news and other various food article websites.

Click here to read the press release from The Food Manufacture

Click here to read the press release from Just Food

Partner Stephanie Kierans helped Giggling Squid open their 42nd restaurant, situated right in the centre of Welwyn Garden City.  

Giggling Squid is thai food with personality and a firm favourite for Team Sherrards.

Founded by husband and wife Pranee and Andrew Laurillard, Giggling Squid opened its first restaurant in 2002 in Brighton, but despite the recent difficult period for all in the hospitality industry, the restaurant chain continues to push ahead with their expansion plans opening beautiful restaurants all over the UK.

Click here to head to Giggling Squid’s website and book your table.

The Sherrards Dispute Resolution department led by Paul Marmor were retained by an international hotel group that was facing a very aggressive claim by a British clearing bank, which was looking to enforce its guarantees and security over the hotel group and its assets in the UK.

We were able to successfully resist the claim and, indeed, to assist the hotel group in procuring refinancing on much more favourable terms.

Charles Hodder, partner in the Commercial property team worked alongside the London Corporate and Commercial team to assist WatchHouse with the opening their ninth specialist coffee shop which boasts state of the art coffee technology including a Slayer Steam LPx and full brunch service seven days a week.

Sherrards are delighted to continue to support Watchhouse as their vision continues to grow.

You can read more about WatchHouse by clicking here. 

 

 

TOCA Social is the first of its kind interactive football and dining experience which combines immersive gaming and world-class food and drink.

The Sherrards Employment team was lucky enough to experience the game for themselves after a training session with Team TOCA just before the venue opened to the public.

Mark Fellows said: “TOCA Social is an amazing venue and it really was such a pleasure to be able to support the team as they start on this exciting venture – we’ve already booked to go back with several clients in Summer 2022!”

During the course of the last calendar year Stephanie and the team have advised Evapo on the renewal of three leases; the strategic re-gearing of two further leases and the acquisition of three new units.  This is typical of the type of work the commercial property team carry out for a number or retail clients.

The team are also now working with the owners of the company in connection with a new business venture and we have concluded the first, of what we hope will be many, acquisitions of premises for the new concept.