Kingston Communications (Hull) Plc Ors v. Stargas Nominees Ltd & Ors [2004] ScotCS 270 (17 December 2004)

Kingston Communications (Hull) Plc Ors v. Stargas Nominees Ltd & Ors [2004] ScotCS 270 (17 December 2004)

The facts did not plainly imply that Stargas had renounced the lease to KSCL or created a new lease with Convergys. Acceptance of rent and tolerance of occupation did not amount to renunciation or creation of a new lease. The guarantee remained in force, and Stargas was entitled to require Kingston to accept a new lease. The call to accept a new lease was made within the contractual time limit.

Citation
[2004] ScotCS 270
Parties
Pursuers and Reclaimers (in First Action); Defenders and Reclaimers (in Second Action): Kingston Communications (Hull) plc; First Defenders and Respondents (in First Action); Pursuers and Respondents (in Second Action): Stargas Nominees Limited; Second Defenders and Respondents (in First Action Only): Convergys EMEA Limited
Jurisdiction
Scotland
Judgment Date
17 December 2004
Procedural Posture
Reclaiming Motions (appeals) in Parallel Actions (commercial Lease Dispute) / Inner House, Court of Session (appellate Decision After Outer House Judgment)
Outcome
Reclaiming motions refused; interlocutor of Lord Ordinary adhered to; action remitted for further proceedings on quantum.
Legal Topics
Commercial Leases, Guarantees, Receivership, Irritancy Clauses, Renunciation of Lease, Creation of New Lease, Guarantor Obligations
Commercial Law Property Law Insolvency Law Commercial Leases Guarantees Receivership Irritancy Clauses Renunciation of Lease +2 more

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Parties

Kingston Communications (Hull) plc

Pursuers and Reclaimers (in First Action); Defenders and Reclaimers (in Second Action)

Stargas Nominees Limited

First Defenders and Respondents (in First Action); Pursuers and Respondents (in Second Action)

Convergys EMEA Limited

Second Defenders and Respondents (in First Action Only)

Procedural Posture

Reclaiming Motions (appeals) in Parallel Actions (commercial Lease Dispute) / Inner House, Court of Session (appellate Decision After Outer House Judgment)

Legal Issues

  1. 1 Whether acceptance of rent from Convergys by Stargas constituted creation of a new lease and renunciation of the existing lease to KSCL, thereby extinguishing Kingston's guarantee obligations
  2. 2 Whether Stargas was entitled to require Kingston to accept a new lease under the guarantee provisions
  3. 3 Whether the time limit for calling on Kingston to accept a new lease was complied with

Ratio Decidendi

The facts did not plainly imply that Stargas had renounced the lease to KSCL or created a new lease with Convergys. Acceptance of rent and tolerance of occupation did not amount to renunciation or creation of a new lease. The guarantee remained in force, and Stargas was entitled to require Kingston to accept a new lease. The call to accept a new lease was made within the contractual time limit.

Court Disposition

Reclaiming motions refused; interlocutor of Lord Ordinary adhered to; action remitted for further proceedings on quantum.

Orders

  • Kingston's action dismissed.
  • Decree granted in favour of Stargas in terms of first and third conclusions.