The High Court decision in London Trocadero (2015) LP v Picturehouse Cinemas Ltd  EWHC 2591 (Ch) represents the latest in a growing line of cases arising out of the Covid-19 pandemic in which the courts have refused to be swayed from established legal principles to accommodate difficulties faced by contractual counterparties, and commercial tenants in particular. Here, the court refused to imply a term into two leases excusing the tenants from the payment of rent and service charges, or accept that there had been a failure of basis, in circumstances where it had at various points during the pandemic been either illegal or unviable for the tenants to use the leased premises.
The court granted summary judgment to the landlord of commercial premises in a claim for rent arrears and service charges which had fallen due over the course of the pandemic, despite the tenants having been unable to use the premises in question at various points because it would have been either illegal or unviable to do so. In previous cases in this area, tenants have largely sought (unsuccessfully) to excuse themselves from contractual performance on the basis of frustration or prior breach of contract by the landlord. Here, the tenants' arguments were based on alleged implied terms excusing them from payment in the circumstances, and an alleged failure of consideration / failure of basis. However, those arguments were equally unsuccessful.
The tenants have been granted permission to appeal the decision, together with a stay on enforcement of the judgment pending the appeal. Landlords and tenants alike will now be watching to see whether the Court of Appeal is more amenable than the High Court has been thus far to legal arguments advanced by tenants to the effect that they should be excused from their payment obligations on account of the pandemic.