Goldman Sachs International v Procession House Trustee Ltd & Anor

Goldman Sachs International v Procession House Trustee Ltd & Anor

The natural and ordinary meaning of clause 23.1 is that the only precondition to the tenant exercising the break clause is yielding up the premises with vacant possession; compliance with clause 11 is not a precondition but a separate contractual obligation. The drafting does not make strict compliance with clause 11 a precondition, and if the landlord wished to impose such a precondition, it should have done so expressly.

Parties
Claimant: Goldman Sachs International; Defendant: Procession House Trustee Limited; Defendant: Procession House Trustee 2 Limited
Jurisdiction
England and Wales
Judgment Date
03 May 2018
Procedural Posture
Part 8 Claim (originating Summons) / Judgment on Construction of Lease Break Clause
Outcome
Declaration granted in favour of the claimant (tenant) that compliance with clause 11 is not a precondition to exercising the break clause; parties to agree precise form of declaration.
Legal Topics
Lease Construction, Break Clauses, Yielding Up Premises, Vacant Possession, Contractual Interpretation
Property Law Contract Law Lease Construction Break Clauses Yielding Up Premises Vacant Possession Contractual Interpretation

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Parties

Goldman Sachs International

Claimant

Procession House Trustee Limited

Defendant

Procession House Trustee 2 Limited

Defendant

Procedural Posture

Part 8 Claim (originating Summons) / Judgment on Construction of Lease Break Clause

Legal Issues

  1. 1 Whether compliance with clause 11 is a precondition to the exercise of the tenant's break option under clause 23.1 of the lease
  2. 2 Proper construction of the break clause in the lease

Ratio Decidendi

The natural and ordinary meaning of clause 23.1 is that the only precondition to the tenant exercising the break clause is yielding up the premises with vacant possession; compliance with clause 11 is not a precondition but a separate contractual obligation. The drafting does not make strict compliance with clause 11 a precondition, and if the landlord wished to impose such a precondition, it should have done so expressly.

Court Disposition

Declaration granted in favour of the claimant (tenant) that compliance with clause 11 is not a precondition to exercising the break clause; parties to agree precise form of declaration.

Orders

  • Declaration that the only precondition to exercising the break clause is yielding up the premises with vacant possession, not compliance with clause 11.
  • Parties to agree the precise wording of the declaration, with liberty to apply if not agreed.