Mayfair restaurant Hush has taken its landlords to court in a dispute over an option in its lease.
The case centres on whether an option to extend the lease by five and a half years can be reinstated by the court after it was terminated by the freeholder during the Covid pandemic.
The lease and the option can be forfeited in the event of non-payment. During the pandemic, the restaurant fell into rent arrears. The landlord forfeited the option but didn’t forfeit the lease. Instead, they waived some of the rent and allowed it to be paid off in instalments.
Now, a year later, lawyers for Hush are asking High Court judge Jonathan Klein to reinstate the option, arguing that, like the lease, in this situation a court can grant relief from forfeiture.
“The right to forfeit the option operates in just the same way,” Hush’s lawyer, Mark Sefton KC, told the judge today.
Forfeiture, in both cases, is “a sanction” for non payment, he said. With regards to the lease “the court is entitled to say that the debit has been paid,” and stop the termination of the lease. The same, he said, could be done for the option.
Specifically, he argued, “proprietary or possessory rights”, which engage relief from forfeiture, are currently in operation.
Lawyers for the landlords disagreed. They argued that, according to the case law, the option cannot be treated in the same way as the lease, so the court isn’t entitled to reinstate it.
The case is being heard in the Rolls Building of the High Court.
Hush Brasseries Ltd v RLUKREF (UK) One Ltd; RLUKREF (UK) Two Ltd
Business and property courts (Mark Sefton KC) 16 November 2022
