A recent English High Court decision, S Franses Ltd v The Cavendish Hotel, examined a landlord's intention to carry out substantial construction work to a premises and its ability to oppose its tenant's lease renewal.
A landlord in England may oppose a lease renewal by demonstrating that it intends to carry out substantial construction work to the premises and that it could not reasonably do so without obtaining vacant possession. This is known as "Ground F". There is a similar provision in the Irish Landlord and Tenant (Amendment) Act 1980. Both require that the landlord must be able to prove a fixed and genuine intention to redevelop at the date of the lease renewal hearing. The major distinction between Ireland and England is that English legislation only requires a reasonable prospect of planning permission, whereas in Ireland a valid planning permission is required.
In this case, prior to the hearing the landlord put forward a number of schemes of development. The final scheme related to the conversion of the premises to two retail units, which did not require planning permission, and was designed to meet the vacant possession requirement under Ground F. The landlord admitted it would not carry out this scheme if the tenant left voluntarily, but would carry them out in full if the court ordered vacant possession. The tenant argued that given the landlord's intention to carry out this scheme was conditional on these works being necessary in order to satisfy Ground F, this was not a sufficient intention to satisfy Ground F.
The court determined that the landlord had the requisite intent to carry out the scheme and this intention satisfied Ground F. In...