Riley Sports Bars (2014) Limited (in Administration) Against Cgw Snooker Llp
| Jurisdiction | Scotland |
| Judge | Lord Braid |
| Neutral Citation | [2022] CSOH 4 |
| Date | 18 January 2022 |
| Docket Number | CA9/21 |
| Court | Court of Session |
| Published date | 18 January 2022 |
OUTER HOUSE, COURT OF SESSION
[2022] CSOH 4
CA9/21
OPINION OF LORD BRAID
In th e cause
RILEYS SPORTS BARS (2014) LIMITED (IN ADMINISTRATION)
Pursuer
against
CGW SNOOKER LLP
Defender
Pursuer: Lake QC; TLT LLP
Defender: Barne QC; Davidson Chalmers Stewart LLP
18 January 2022
Introduction
The issues
[1] The defender is the landlord, and the pursuer the tenant, of premises at 9 Bridge
Place, Aberdeen. Th e pursuer is in administration. It wishes to assign its interest in the
lease of the premises to a new company, WPC7 Ltd (WPC7), offering as a guarantor the
ultimate parent company of both the pursuer and WPC7, Weight Partners Corporate
Limited (WPCL), which is a guarantor of the pursuer’s obligations under the lease. The
defender has refused to consent to that assignation. The first issue for decision is whether
that refusal of consent is reasonable. The pursuer seeks decree o f declarator that it is not.
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[2] Separately, in January 2020 the parties entered into a Minute of Agreement whereby
the defender agreed to contribute £425,000 towards the cost of building works to the
premises to be undertaken by the pursuer, which was to use all reasonable endeavours to
complete th e works by 21 January 2021. The work has not yet been done. The second issue
for decision is wheth er the defender breached its obligation of good faith under the
Agreement by failing to agree plans and specifications forwarded by the pursuer, thereby
preventing the pursuer from completing the works. A related but distinct issue is whether
the pursuer is entitled to a force majeure extension of 6 months for completion of the works,
due to Covid. The pursuer also seeks decree of declarator in respect of these matters.
The proof
[3] The action called before me for proof. Evidence was led remotely over 5 days. All of
the evidence (apart from that of the pursuer’s expert, Mr Peter Graham, who spoke to his
reports dated 8 and 21 October 2021) was given by means of witness statement, augmented
by oral questioning. To the extent that they spoke to the history of events, I found all of the
witnesses generally to be credible and in the main reliable, except insofar as stated otherwise
in this opinion. The controversy centres on what were the defender’s reasons for refusing
consent to the assignation; and on why the building work has not yet proceeded.
The WPCL group
[4] At the outset, it is helpful to say something of the Rileys business, and the corporate
structure of the WPCL group of which the pursuer and WPC7 form part. The ultimate
holding company and beneficial owner of all the companies within the group is WPCL. Its
financial standing was the subject of much of the evidence, and I will return to it later. It is a
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private equity business investor established in or about 2008 which focuses on consumer
and health care services at the smaller end of the market in the UK and Ireland. It is
registered with the FCA. Its sole shareholder and director is James (Jim) Weight. All of
the companies in the WPCL group are managed by Weight Partners Capital LLP.
[5] In 2014, Mr Weight decided to acquire, as an investment, the Rileys sports and
leisure club business from the administrators of the previous owners of that business, Rileys
Sports Bar s Limited. The main trading activity of the business was, and is, the operation of
licensed premises: in particular, the provision of facilities to allow customers to play
snooker, darts and pool and to watch sports on TV and media channels. The pursuer was
incorporated on 27 November 2014 for the purpose of making the acquisition. Valley Topco
Limited (VTC) was incorporated at the same time as a wholly owned subsidiary of WPCL,
as the pursuer’s holding company, and as the vehicle for funding the acquisition, and
subsequently for funding the pursuer. As part of the acquisition, the pursuer acquired the
lease of the premises by way of assignation with the consent of the defender, subject to a
guaran tee from both VTC and WPCL.
[6] Rileys was, until the pursuer went into administration in 2020, one of the two major
investments of the WPCL group, the other being a company called Boxclever Ltd, which
is the major player in the UK electrical goods rental market, mainly televisions. It is a
subsidiary of WPC2, another subsidiary of WPCL. Dividends from Boxclever are in practice
ultimately paid to the pursu er via WPC2.
[7] The pursuer itself went into administration in 2020, precipitated by Covid. Four new
companies (WPC7 through to WPC10) have been formed by Mr Weight for the purpose of
acquiring the Rileys business from the administrators, the relevant company for present
purposes being WPC7, which has acquired what are seen as the pursuer’s better sites. The
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