James Naylor warns against succumbing to advances to delay proceedings
Is a landlord (in administration) permitted to delay litigation by up to a year to facilitate an improvement in the value of its premises by £2m? In making the argument, can it rely on its own insolvency, to the detriment of its tenant? These ostensibly wacky contentions were examined by the High Court in Somerfield Stores Ltd v Spring (Sutton Coldfield) Ltd [2009] EWHC 2384 (Ch), [2009] All ER (D) 68 (Oct).
In Somerfield, T had a lease of commercial premises. T’s lease expired and it applied to court to renew its lease pursuant to the Landlord and Tenant Act 1954 (LTA 54). L opposed the claim, arguing it intended to redevelop the premises, in accordance with s 30(1)(f), LTA54. L then entered administration. Paragraph 43.6 of Sch B1 to the Insolvency Act 1986, states: “No legal process…may be instituted or continued against the company or property of the company except – (a) with the consent of the administrator, or (b) with the permission of the
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