Michael Gerson (Leasing) Ltd v Loach & Ors [2002] EWCA Civ 1031 (10 July 2002)

Michael Gerson (Leasing) Ltd v Loach & Ors [2002] EWCA Civ 1031 (10 July 2002)

The court held that 'all arrears' in paragraph 9(C)(iv) of the lease agreement refers only to arrears of rental and other amounts accrued due before termination, and does not include future rentals. Interest is not contractually payable on future rentals after termination. Paragraph 3(D) applies only while the...

Source-derived case information.

Citation
[2002] EWCA Civ 1031
Parties
Claimant/respondent: Michael Gerson (Leasing) Ltd; Defendant/appellant: Jack Loach; Defendant/appellant: Sidney Loach; Defendant/appellant: Sylvia Hayley
Jurisdiction
England and Wales
Judgment Date
10 July 2002
Procedural Posture
Civil Appeal / Appeal From Chancery Division Judgment
Outcome
Appeal allowed in part
Legal Topics
Construction of Lease Agreements, Interest on Arrears, Guarantees, Repudiatory Breach, Statutory Interest
Contract Law Commercial Law Construction of Lease Agreements Interest on Arrears Guarantees Repudiatory Breach Statutory Interest

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Parties

Michael Gerson (Leasing) Ltd

Claimant/respondent

Jack Loach

Defendant/appellant

Sidney Loach

Defendant/appellant

Sylvia Hayley

Defendant/appellant

Procedural Posture

Civil Appeal / Appeal From Chancery Division Judgment

Legal Issues

  1. 1 Whether interest is payable on future rentals under the lease agreement after termination
  2. 2 Proper construction of 'all arrears' in paragraph 9(C)(iv) of the lease agreement
  3. 3 Applicability of paragraph 3(D) to post-termination sums

Ratio Decidendi

The court held that 'all arrears' in paragraph 9(C)(iv) of the lease agreement refers only to arrears of rental and other amounts accrued due before termination, and does not include future rentals. Interest is not contractually payable on future rentals after termination. Paragraph 3(D) applies only while the agreement is subsisting and does not apply post-termination. Statutory interest under section 35A of the Supreme Court Act 1981 is appropriate on the relevant sum from the termination date.

Court Disposition

Appeal allowed in part

Orders

  • Judge's order varied to disallow contractual interest on future rentals
  • Leave granted to amend particulars of claim to seek statutory interest under section 35A of the Supreme Court Act 1981