Lease — Commercial premises User restriction — Claimant wishing to sublet premises for sale of pre-prepared sandwiches etc — Whether proposed use constituting prohibited trades of victualler or coffee-house keeper — Claim allowed in part
The claimant was the tenant of commercial premises under a 125-year lease that had been granted in 1950. The lease contained a covenant that prohibited the claimant from using the premises for the trade or business of, inter alia, victualler, vintner, tavern keeper, vendor of malt liquor, restaurateur or coffee-house keeper. The claimant wished to sublet the premises to a company that sold pre-prepared sandwiches, hot and cold drinks and so forth.
The defendant landlord, which owned the freehold interest in the premises, considered that the restrictive covenant prevented the claimant from subletting the premises for that purpose. The claimant applied to the court for a declaration that it was entitled to use the premises as a shop for the sale of: (i) pre-prepared sandwiches and ancillary products for consumption off the premises; or (ii) such products for consumption off the premises and for ancillary consumption on the premises.
A company related to the claimant was joined as a Part 20 defendant because it occupied premises that were subject to a similar restrictive user covenant.
Held: The claim was allowed in part.
The proposed user of the premises was not precluded by the restrictive covenant since it did not constitute the trade of “victualler”. However, purchases could not be consumed on the premises because such use could amount to the trade or business of a “coffee house keeper”, which was prohibited by the covenant.
Bearing in mind the words surrounding the user covenant, and taking into account the meaning that would have been attributed to the words “victualler” and “coffee house keeper” when the lease had first been granted, the court was satisfied that the word “victualler” should be narrowly interpreted to mean a licensed publican, rather than a business that provided pre-prepared sandwiches to busy office workers.
On the other hand, the words “coffee house keeper”, which, in 1950, could have extended to a snack bar where food was consumed on the premises, could be open to a broad interpretation: Mortimer Investments Ltd v Mount Eden unreported 26 March 1997 and Fitz v Iles [1893] 1 Ch 77 considered.
Philip Kremen (instructed by Brecher Abram) appeared for the claimant/Part 20 defendant; Jonathan Small (instructed by Stephenson Harwood) appeared for the defendant/Part 20 claimant.
Eileen O’Grady, barrister
