Landlords – heave a sigh of relief, tenants – look the other way.
Following from my earlier article on this subject, the European Medicines Agency (“EMA”) has announced that it will not be appealing the High Court’s ruling which determined that Brexit would not frustrate its 25 year lease. Instead, the EMA has managed to settle the dispute with the landlord, the Canary Wharf Group, and successfully sublet the premises to WeWork (a company that provides shared workspaces) for the rest of the contractual term of the lease. This was, of course, one of the remedies already available to the EMA under the terms of the lease and rightly pointed out by the High Court.
This case highlighted the narrow constraints of the doctrine of contractual frustration and emphasised the difficulty a party would encounter when seeking to get out of a commercial agreement as a result of Brexit.
It would have been interesting to see how the Court of Appeal addressed this issue and their take on the possibility of Brexit acting as a frustrating event in relation to other commercial contracts which were entered into prior to Brexit becoming a foreseeable event.
If you need advice on the terms of or getting out of your commercial lease, please contact any member of our Commercial Property team.