Argyll Stores has been permitted to appeal to the House of Lords against an injunction forcing it to reopen a Safeway store in the Hillsborough shopping centre, Sheffield. The retailer is challenging the Appeal Court’s decision last December to override the judiciary’s traditional reluctance to enforce keep-open leases. Instead, where a tenant wished to close down, it could do so provided it was willing to pay damages to the landlord.
In particular, Argyll is disputing the judges’ ruling that as an anchor store amounting to 30% of total letting space in the centre, “an award of damages would be unlikely to compensate the landlords fully.” The retailer argues that the store’s trading loss of £70,000 during 1994 justified its decision to close what was clearly a commercially unviable unit held on a 35-year lease.
Titmuss Sainer Dechert’s Steven Fogel, acting for Argyll, commented: “The issue is of major public importance and great concern to tenants and landlords…[The question is] whether it is right to allocate scarce economic resources to areas which are keenly depressed when they could be put to better use elsewhere.”
EGi News 18/04/96
