Leases: what's in a name?

  • 3 mins read

Quite a lot actually, if you want to enter into a legally binding agreement.

In the recent case of Seafood Shack Ltd v Darlow [2019] EWHC 1567 (Ch) a lease was granted by Mr Darlow to Seafood Shack UK Ltd.

No such company existed in 2017, however, when the lease was granted.

The claimant, Seafood Shack Ltd, was incorporated in May 2016.  A subsidiary of the claimant, Seafood Shack (Cardiff) Ltd, was incorporated in November 2016.Seafood Shack (Cardiff) Ltd traded from the premises demised by the lease.  In January 2018, however, the company went into liquidation.  The liquidators disclaimed the lease.

Seafood Shack Ltd argued that the lease should be rectified and that it be named as the tenant.

HHJ Jarman QC, however, found that, on the facts of the case, it was not possible for a reasonable person, having all background knowledge, to have concluded that the lease was supposed to have been granted to Seafood Shack Ltd.

Accordingly, the lease was not rectified.

Probably, had the people who drafted the lease omitted the letters "UK" from the name of the tenant, Seafood Shack Ltd would still be serving up pescatarian dishes in Mr Darlow's property.

The decision in this case may seem like a pedant's dream. However, in the circumstances, HHJ Jarman QC was arguably right to conclude that a reasonable, i.e. objective, person could not have known who the tenant was supposed to be.

Send us a message