The decision of the High Court (Mr Justice Charleton) on 25 March 2013 in the case of Ickendel Limited -v- Bewleys Café Grafton Street Limited (the Bewleys case) has caused some head scratching amongst the legal and business community.

Essentially, the judge decided that there was some degree of ambiguity in the clause setting out how the rent was to be determined on review, which required him to decide that “upwards only” was by reference to the 1987 rent when the Lease was signed, rather than to the rent prior to the 2012 rent review provided for in the Lease.

Although the Lease stated that (and I am paraphrasing) the rent on review was to be the greater of the rent payable during the preceding period and the rent which might be determined on review (being the full open market yearly rent), the Court held that the “preceding period” did not mean just before the review date, but in fact right back to 1987.  

There was some ambiguity in the wording of the Lease, but on foot of this ruling, language often found in rent review clauses does not in fact have the effect previously understood.

It is quite possible (and in the writer's view probable) that the landlord (of its own volition, or at the urging of NAMA – its banker) will appeal this decision to the Supreme Court.

It should be noted that in any event, no commercial lease entered into on or after 28 February 2010 can have an upwards only rent review clause.