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A breakthrough?

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11 July 2013 / Deborah Caldwell
Issue: 7568 / Categories: Features , Property
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Deborah Caldwell examines developments surrounding tenants’ break rights & recovery of overpayments

After a seemingly endless run of landlord-friendly decisions on break rights, the High Court has finally delivered a judgment in favour of tenants (Marks and Spencer Plc v BNP Paribas Security Services Trust Company (Jersey) Ltd [2013] EWHC 1279 (Ch), [2013] All ER (D) 214 (May)).

Background

Over the past couple of years, tenants have encountered difficulties exercising break rights where the specified date for termination of the lease has fallen in the middle of a rent quarter. On the quarter day before the break date, the tenant is obliged to pay a full quarter’s rent. That was made abundantly clear in QuirkCo Investments Ltd v Aspray Transport Ltd [2011] EWHC 3060 (Ch) and more recently in Canonical UK Ltd v TST Millbank LLC [2012] EWHC 3710 (Ch), [2013] All ER (D) 50 (Feb).

Where a tenant has successfully exercised its break right, the issue then becomes one of whether it can recover any “overpayments” it has made, meaning that part

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