Judgment handed down in B&M Retail Ltd v HSBC Bank Pension Trust (UK) Ltd [2023]
Judgment has just been handed down by Miles J upon appeal in B&M Retail Ltd v HSBC Bank Pension Trust (UK) Ltd [2023] EWHC 2495 (Ch), upholding the decision of the trial judge to impose an immediate redevelopment break clause in a business tenancy renewal. Guy Fetherstonhaugh KC and Julia Petrenko, instructed by Andrew Myers and Kathryn Lister of Stephenson Harwood LLP, acted for the respondent HSBC.
In this case, B&M sought a new lease of a shop in Willesden. By reason of a mishap in its post room, HSBC did not oppose the grant of a new lease but did seek the inclusion of an immediately operable break clause in the same. Following a three day hearing, in March 2023, HHJ Saunders was satisfied that there was a “real possibility” of redevelopment and ordered that the new lease should contain an immediate redevelopment break clause.
B&M obtained permission to appeal on two grounds. Shortly before the appeal hearing B&M indicated that it did not intend to pursue the first ground of appeal, which concerned whether there was a real possibility of HSBC obtaining planning permission. B&M did however contend, by their second ground of appeal, that HHJ Saunders was wrong to grant a rolling break clause operable at any time during the term on the basis that this defeated the purpose of the Landlord and Tenant Act 1954, which was to give the tenant a reasonable degree of security of tenure.
Miles J rejected this argument holding that, reading the Judgment as a whole, HHJ Saunders directed himself in accordance with the correct legal test and further that he had considered the various factors for and against the inclusion of a break clause. The appeal was therefore dismissed.
Read the full judgment here.
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