SHERIFFDOM OF GRAMPIAN HIGHLAND AND ISLANDS AT ABERDEEN

CA2/12

ABERDEEN, 14 September 2012.

The sheriff, having resumed consideration of the cause, sustains the first plea-in-law for the defender, repels the fourth plea-in-law for the pursuer and dismisses the cause; reserves meantime the question of expenses and appoints parties to be heard thereon on 3 October 2012 at Aberdeen Sheriff Court at 9.45 am.

NOTE

[1] The pursuer in this action seeks declarator that the parties are bound by a valid and enforceable lease of premises at 35-39 Ann Street, Aberdeen in terms of a lease annexed to the pursuer's offer of let dated 13 September 2006 and an acceptance thereof by the defender of the same date, said lease signed by the pursuer on 23 March 2011 and delivered to the defender on 13 December 2011. The pursuer also seeks payment of sums of money in respect of rent which it is claimed is due for the period from 14 September 2011 to 27 February 2012.

[2] The defender contends that the lease ended on 13 September 2011 and that since the rent was paid in full up to that date no further payments are due.

[3] There was no real dispute between the parties as to the factual background and it was common ground that if I accepted the submissions of the defender the action would require to be dismissed. On the other hand, if I preferred the submissions for the pursuer, I would be bound to grant decree as craved. As Mr McMillan, for the defender, put it the outcome of the case turned upon the correct interpretation of the documents relied upon by the parties as forming the contract between them.

[4] The closed record, No. 17 of process, is relatively brief and it is unnecessary for me to repeat the essential facts in this note. Both parties lodged written notes of argument in advance of the debate and they are Nos. 18 (pursuer) and 19 (defender) of process. These notes present an accurate summary of the submissions which were advanced at the debate.

[5] I have dismissed the action because I accept the submissions advanced on behalf of the defender that the lease came to an end on 13 September 2011. Although the missives of let provided for a ten year term those missives, in terms of clause 13, ceased to be enforceable after a period of two years from the date of entry except insofar as founded upon in any court proceedings initiated within that period. No such proceedings were actually raised and, notwithstanding the terms of clause 6 of the missives of let, no engrossed lease document was ever presented by the pursuer to the defender for execution within the two year period. So the formal written lease came to an end on 13 September 2008. However, the conduct of the parties thereafter shows clearly that the lease was renewed on a year-to-year basis by tacit relocation until the defender served a notice to quit on 9 December 2010 and removed from the premises on 13 September 2011. I accept the submission for the defender that what happened was that the original missives of let were allowed by both parties to fall and that although they had the opportunity to enforce their terms, including terms relating to the signing of a lease, they chose not to do so.

[6] Essentially, the argument for the pursuer was that the missives of let provided for a ten year term and that although the missives ceased to be enforceable after a period of two years from the date of entry that did not affect the substance of what had been agreed between the parties. It was said that there had been agreement that the period of the lease would be ten years and to construe the missives as contended for by the defender would fly in the face of commercial good sense. I do not consider that this matter is quite as clear as suggested by counsel for the pursuer and I prefer the argument advanced on behalf of the defender that clause 13 put an onus on the parties to get on with finalising the terms of the lease. It also seems to me, as suggested by the solicitor for the defender, that the clause provided a way out for either party if a problem arose in the first two years and, on a certain view of matters, might be regarded as providing a degree of flexibility consistent with commercial good sense.

[7] Having determined these matters as I have it follows that the defender is entitled to decree of dismissal. But there was another issue in relation to the significance of the document purporting to be a lease which was subscribed by the grantor only on 23 March 2011 and delivered to the defender on or about 13 December 2011. For the avoidance of doubt I accept the submission for the defender that this document was not a lease because it was not signed by both parties. But, in any event, of course, it was delivered not only after the missives of let had fallen but also after the tacitly relocated lease had ended.

[8] I was asked to reserve the question of expenses and that is what I have done and there will be a hearing thereon in due course.