Rockford Trilogy Ltd v NCR Ltd
| Jurisdiction | Scotland |
| Judge | Lord Clark |
| Judgment Date | 19 October 2021 |
| Court | Court of Session (Inner House) |
| Docket Number | No 7 |
Second Division
Lord Clark
Gilchrist v Westren (1890) 17 R 363
McDonald v O'Donnell [2007] CSIH 74; 2008 SC 189; 2007 SLT 1227; 2008 SCLR 93
McFarlane v Mitchell (1900) 2 F 901; 8 SLT 35
Signet Group plc v C & J Clark Retail Properties Ltd 1996 SC 444; 1996 SLT 1325; 1996 SCLR 1020
Smith v Grayton Estates Ltd 1960 SC 349; 1961 SLT 38; 1960 SLT (Notes) 81
Cameron, JGS, and Colquhoun, JC, ‘Landlord and Tenant’ in Stair Memorial Encyclopaedia: The Laws of Scotland (Butterworths/Law Society of Scotland, Edinburgh, 1992), vol 13, para 450
Rennie, RR, Leases (W Green/Scottish Universities Law Institute, Edinburgh, 2015), p 144
Landlord and tenant — Termination of lease — Tacit relocation — Exclusion of tacit relocation — Informal notification of lack of consent to continuation of lease — Whether email stating that respondents would not remain as occupiers of premises unless new terms agreed sufficient to exclude tacit relocation
Rockford Trilogy ltd brought an action under the commercial cause rules (Act of Sederunt (Rules of the Court of Session 1994) 1994 (SI 1994/1443 (S 69)), Ch 47) in the Court of Session against NCR Ltd seeking declarator, inter alia, that the defenders' lease of subjects from the pursuers had been continued by operation of tacit relocation. The cause called before the commercial judge (Lord Clark) for a proof before answer. At advising, on 7 May 2021, the commercial judge assoilzied the defenders ([2021] CSOH 49; 2021 Hous LR 67). The pursuers reclaimed.
The reclaimers were the landlords and the respondents were the tenants under a commercial lease. The lease was due to come to an end on 26 March 2020. Beginning in late 2019, the parties' agents engaged in discussions regarding the possibility of entering into a licence of some parts of the premises after the 2003 lease expired. On 21 January 2020, the respondents' agents wrote stating that the respondents were ready to commit to a relocation elsewhere and were only prepared to consider remaining in the premises if certain terms as to dilapidations and a nil rent period were granted. Parties continued negotiations. Heads of terms were drafted by the reclaimers, on 4 February 2020. No new lease was ultimately entered into. Neither party served a notice to quit. On 26 February 2020, the reclaimers' solicitors emailed the respondents stating that as no notice to quit had been received the lease had continued by operation of tacit relocation.
The reclaimers brought an action against the respondents for declarator that no notice to quit had been served and that the lease had been continued by operation of tacit relocation. The commercial judge held that the respondents' agents' email of 21 January 2020 had conveyed a clear message that the respondents would not continue to occupy the premises unless a new arrangement were agreed. The commercial judge held that this statement was sufficient to exclude tacit relocation. A reclaiming motion was lodged by the reclaimers.
The reclaimers contended that the commercial judge had erred in failing to consider the email of 21 January 2020 as part of a lengthy negotiation. It did not constitute the clear and effective communication of intention not to continue with the lease required to prevent the operation of tacit relocation.
Held that it was sufficient that the circumstances be such as to exclude tacit relocation, with formal termination not required but simply intimation, whether formal or informal, of a lack of consent to continuation of the lease, and that the email of 21 January 2021 had made clear that the respondents would not remain in the premises on the existing terms, with the result that tacit relocation was excluded (paras 13, 14); and reclaiming motion refused.
Observed that it was unhelpful to term the required communication to exclude tacit relocation a ‘notice’, which was too easily conflated with notices to quit, and which wrongly suggested a degree of formality which was not required (para 12).
Signet Group v C & J Clark Retail Properties 1996 SC 444 followed.
The cause called before...
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