Break Clause: Ending the Lease Early

The Court of Appeal has overturned the first instance decision in Marks and Spencer plc v BNP Paribas Securities Services Trust Company (Jersey) Ltd and another [2013] EWHC 1279 (Ch).

The tenant had exercised a break clause, ending the lease early. It sought a refund of rent it had paid in advance, which related to a period after the break date.

The Court of Appeal ruled that it was not appropriate to imply a term into the lease that entitled the tenant to a refund of the rent it had paid in advance in accordance with the express terms of the lease.

Arden LJ, who provided the leading and only substantive judgment, stated that the parties could easily have incorporated wording in the lease that required the landlord to repay any rent (or other charges) attributable to the period after the lease came to an end.

Marks and Spencer plc v BNP Paribas Securities Services Trust Company (Jersey) Limited and another [2014] EWCA Civ 603 (14 May 2014)

Written by James Naylor

Partner, CG Naylor LLP.