High Court Rules On Bewley's Rent Reduction

The rent payable by Bewley's Oriental Café in Grafton Street, Dublin must be allowed to fall in line with the currently depressed open market rate, a High Court judge has ruled.

Landlord Ickendal Limited, owned by Johnny Ronan's Treasury Holdings Group, claimed they were entitled to a five-yearly upwards only rent review.

In his ruling Mr Justice Peter Charleton had said that to proceed towards ever-increasing sums in rent every five years, while deflation had decreased, was to substitute an unreal figure for the rent.

It is understood that within the lease agreement between Bewley's and Ickendel stipulates that the rent was never to fall below the initial agreement of 1987.

However, Judge Charleton said an open market clause in the agreement could only reasonably be construed so as to allow for a fall in rent which had increased to €1.5m because of upwards only reviews since 1987.

Adding that the parties had the opportunity to insert a clause explicitly stating that the rent could not fall below what had been agreed at the previous review but that they had not done so.

It is thought that the decision of Mr Justice Charleton could have huge repercussions for landlords who have been claiming upwards only reviews and is expected to be widely welcomed by hard pressed shop tenants.

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