Before signing up to a lease of premises, it is essential for the tenant to ensure that:
- (A) planning permission exists for the proposed use; and
- (B) the lease permits that proposed use.
This sounds obvious but the recent case of Purvis Plant Hire Limited v David Brewster and others shows what can happen when these basic steps are not followed.
In this case the lease permitted the premises to be used only for the storage of bulk materials or such other use as the landlord may permit. The tenant not only stored materials but also installed expensive equipment to recycle construction and demolition materials (a use to which he believed the landlord would consent).
Following a complaint to the Council about the noise and dust levels, a planning contravention notice was served and, on appeal, the planning Reporter decided that no planning permission existed for the recycling of materials. He also noted that the Council believed that there was no planning permission for storage of materials.
The tenant appealed to the court and argued that the Reporter's decision and the Council's position on planning permission for storage meant that the tenant could no longer use the premises for their business activities. The tenant claimed that this "frustrated" the lease i.e. the lease could no longer be performed and so now fell.
Unfortunately for the tenant, the court held that the lease remained enforceable as there had not been a supervening event (a requirement of frustration) during the period of the lease - the planning position had remained unchanged throughout. Accordingly, the tenant was left with a lease of premises which the tenant could not use for the purposes of their intended business.