Over Taylor Biggs

Often, the genuineness of the Landlord's intention is brought into question.  The Courts have established clear guidance on what is required. Tenants sometimes make tactical applications to the Court to bring forward the date on which the Landlord must demonstrate that its intentions are genuine.

These matters recently came to a head for Somerfield Stores Limited for a site at Sutton Coldfield.  The supermarket and adjoining land were held under three Leases that the Landlord had bought in 2006, intending to redevelop.  The Landlord served notice under Section 30(1)(f) of the Landlord and Tenant Act 1954 to determine the tenancies and opposed renewal of the Leases on the basis of its intention to redevelop.

Somerfield applied to the Court on an accelerated procedure, seeking a Court Order, without a full trial, that the Landlord's grounds of opposition were not made out. 

The Judge in the Birmingham County Court had indicated that Somerfield would need to establish the Landlord could not satisfy the ground of opposition either at the date of the accelerated hearing or within a reasonable time after it and that Somerfield had failed to satisfy that test.  Somerfield therefore appealed and the matter was referred to the High Court.

The High Court dismissed Somerfield's appeal but for different reasons.  The High Court decided that the intention had to be shown at the date of the full trial.  The purpose of the accelerated hearing was to determine whether a party has a real prospect of establishing its case.  In most instances, the application for accelerated judgment is based on facts that have already occurred so the Court has the opportunity to consider whether there is a real prospect that the evidence available at trial will be sufficient to establish the facts.

Here, the intention to redevelop must exist at the date of the trial and not in the past.  On the accelerated judgment procedure, the Court should ask whether the Landlord has a real prospect of proving that he has formed the requisite intention at the date the full trial will take place.

The decision will be seen as a discouragement to Tenants from making tactical applications for an accelerated judgment simply to bring forward the date at which the Landlord has to prove its intention.  This is usually to embarrass the Landlord who might have steps still to take to form a sufficient weight of evidence of a genuine ability to bring a development forward.

The High Court did say that if a Tenant is concerned a Landlord was delaying in order to put forward a workable development at the date of the trial, the Tenant's alternatives were to deal quickly with the requirements in the timetable laid down by the Court for the full trial and to make any necessary applications to the Court to hold the Landlord to that timetable, so that the matter is brought to trial in the fastest time possible.

Somerfield Stores Limited v Spring (Sutton Coldfield) Limited (in Administration) 2010 High Court