Debenhams Retail Plc & Anor v Sun Alliance & London Assurance Company Ltd
VAT is to be included in turnover for the purpose of calculating the additional rent under the lease, as it is the modern equivalent of purchase tax, which was included in turnover at the time of the lease's negotiation. The lease wording and commercial context support this interpretation.
- Parties
- Respondent/claimant: Debenhams Retail plc; Respondent/claimant: Debenhams Properties Ltd; Appellant/defendant: Sun Alliance and London Assurance Company Ltd
- Jurisdiction
- England and Wales
- Judgment Date
- 20 July 2005
- Procedural Posture
- Civil Appeal / Appeal From High Court Judgment
- Outcome
- appeal allowed
- Legal Topics
- Lease Interpretation, Turnover Rent, Value Added Tax (vat), Purchase Tax, Commercial Leases
Case Brief
Summary, issues, holding and outcome
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Parties
Debenhams Retail plc
Respondent/claimant
Debenhams Properties Ltd
Respondent/claimant
Sun Alliance and London Assurance Company Ltd
Appellant/defendant
Procedural Posture
Civil Appeal / Appeal From High Court Judgment
Legal Issues
- 1 Whether VAT should be included in the calculation of turnover for the purposes of additional rent under the lease.
Ratio Decidendi
VAT is to be included in turnover for the purpose of calculating the additional rent under the lease, as it is the modern equivalent of purchase tax, which was included in turnover at the time of the lease's negotiation. The lease wording and commercial context support this interpretation.
Court Disposition
appeal allowed
Orders
- Declaration that VAT is to be included in turnover for the purpose of calculating the Turnover Rent under the lease dated 19 April 1971.
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