The lease contained a clause where the rent was to be set according to the ‘gross amount of the total sales’ of the tenant. The tenant argued that this figure did not include the VAT charged on sales, the landlord argued that it was the total sums paid by purchasers.
Held: The words were not plain and unambiguous. The commercial purpose was to ensure that the rent reflected the trading conditions, and that both parties shared the risks and returns of trading. To include VAT would not give a true and fair picture of the tenant’s profit and loss, and VAT was to be excluded from the calculation.
Judges:
Etherton J
Citations:
Times 11-Nov-2004
Cited by:
Appeal from – Debenhams Retail Plc and Another v Sun Alliance and London Assurance Company Ltd CA 20-Jul-2005
The landlord appealed against a decision that VAT was not to be included when calculating a rent based upon the turnover in the premises, when it had been expressed to include purchase taxes.
Held: The appeal succeeded: ‘it would be wrong to . .
Lists of cited by and citing cases may be incomplete.
Landlord and Tenant
Updated: 30 April 2022; Ref: scu.219515