Dreams Ltd v Pavilion Property Trustees Ltd & Anor

Facts

The defendants own a retail building in Margate, Kent, forming part of a retail estate. By a lease dated 11 August 2006 they let the premises to Dreams plc for a term ending in 2031 at a market rent, on full tenant's repairing covenants together with a covenant to remove the tenant's belongings and fixtures at the end of the term. Dreams plc went into administration in 2013, and on 25 April 2014, with the defendants' consent, it assigned the lease to the claimant. On the same day the parties executed a deed shortening the term to 2024, which took effect as a surrender and re-grant, a side agreement giving the claimant rent and other concessions, and an Agreement for Surrender incorporating the Standard Commercial Property Conditions (2nd Ed.), under which either party could require a surrender on notice. The claimant gave notice on 16 October 2018 to surrender on 25 April 2019. The defendants' surveyor inspected and served a priced schedule of dilapidations, and the defendants maintained that payment of the dilapidations sum was a precondition of completion; they also contended that a mezzanine floor and lift left in situ denied vacant possession. They refused to complete on 25 April 2019. The claimant issued proceedings on 3 June 2019 seeking specific performance, damages and declarations, and Deputy Master Bartlett ordered the trial of two preliminary issues.