JD Wetherspoon chairman Tim Martin has warned agents and investors to be wary of back-to-back freehold deals after settling another alleged fraud claim.
The high street pub chain has collected around £10m in damages and fees as a result of high court battles with various agents and investors over the past eight years.
The battles have largely related to a claim in which Wetherspoon successfully argued that its former retained agent, Van de Berg & Co, had fraudulently diverted freehold properties to third parties, while recommending Wetherspoon take leases on them, thereby boosting the value.
This week the pub operator settled its final claim, accepting a £400,000 payment from property investor Jason Harris.
Wetherspoon had sued Harris, formerly of First London and now of First Urban Group, as an accessory to frauds committed by Van de Berg & Co.
Harris contested the claim and has not admitted liability.
The investor had his call for dismissal of Wetherspoon’s claim refused this week, with the chancellor of the high court, Sir Terrance Etherton, saying that the pub group’s claims were “more than fanciful” and had a real prospect of success at trial.
The case related to the Rhinoceros pub in Rotherham and the Lord Burton pub in Burton-on-Trent.
Wetherspoon first launched its claim against Van de Berg & Co in 2006 and was awarded almost £8m in damages in 2009.
It has sued a number of other parties in connection with the initial claim, including Anthony Lyons, formerly of Davis Coffer Lyons, and Paul Ferrari, of agent Ferrari, Dewe & Co, and settled them all.
Lyons agreed a £1.2m settlement and Ferrari a £500,000 payment.
Martin said: “Although liability was denied by all of the defendants in each of the cases which followed the Van de Berg judgment, I believe that these cases contain an important message for agents and property investors. If you are offered very profitable back-to-back freehold deals by the retained agent of a retailer or another principal, it is advisable to verify in writing from the retailer itself that it has consented to the transaction.”
samantha.mcclary@estatesgazette.com
