McDonalds Real Estate Ltd Liability Partnership v Arundel Corporation

McDonalds Real Estate Ltd Liability Partnership v Arundel Corporation

The building type to be valued under the rent review clause is a second generation standard warehouse constructed in accordance with planning permission for B8 use (storage/distribution), but the prospect of obtaining planning permission for retail use (A1) may be taken into account in the valuation. There is no express or implied term confining the future use of the notional building to storage and distribution, and restrictions on permitted use are to be disregarded as per the lease.

Parties
Claimant: McDonalds Real Estate Ltd Liability Partnership; Defendant: Arundel Corporation
Jurisdiction
England and Wales
Judgment Date
16 January 2008
Procedural Posture
Civil (landlord and Tenant) / Judgment
Outcome
Partially allowed
Legal Topics
Rent Review, Lease Interpretation, Planning Permission
Landlord and Tenant Real Property Rent Review Lease Interpretation Planning Permission

Case Brief

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Parties

McDonalds Real Estate Ltd Liability Partnership

Claimant

Arundel Corporation

Defendant

Procedural Posture

Civil (landlord and Tenant) / Judgment

Legal Issues

  1. 1 Proper interpretation of the rent review clause in the lease between the parties, specifically the meaning of 'warehouse' and whether potential for retail use can be considered in valuation.

Ratio Decidendi

The building type to be valued under the rent review clause is a second generation standard warehouse constructed in accordance with planning permission for B8 use (storage/distribution), but the prospect of obtaining planning permission for retail use (A1) may be taken into account in the valuation. There is no express or implied term confining the future use of the notional building to storage and distribution, and restrictions on permitted use are to be disregarded as per the lease.

Court Disposition

Partially allowed

Orders

  • First declaration sought by McDonalds granted; second declaration refused.