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A Brexit Sigh of Relief for Landlords

  • United Kingdom
  • Other

20-02-2019

Canary Wharf Management Limited v European Medicines Agency [2019] EWHC 335 (Ch)

The High Court has held that the lease of the European Medicines Agency’s Canary Wharf headquarters has not been frustrated by Brexit.  The judgment, in response to a request for a declaration brought by the  landlord rather than the tenant, will come as a significant relief for UK landlords.  Frustration of an English lease has always been a rare finding – and so the judgment follows established law.

Frustration in part being dependent upon the foreseeability of the relevant event, the judge held that at the time the lease was entered into Brexit was a possibility, but no inference could be drawn from the lack of a Brexit clause in the lease itself.  There was neither frustration by supervening illegality nor frustration of common purpose.

Several factors influenced the court’s decision –

  • The fact that it was perfectly lawful and possible for EMA to continue to operate from the UK, notwithstanding Brexit
  • The fact that EMA was legally able to continue to hold UK property post Brexit
  • The fact that the lease contained provisions as to assignment or underletting of the lease which EMA could rely upon if it no longer required the property

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