Last orders! High Court calls “reasonable time” on starting ground (f) works

The point arose in Pridewell Properties (London) Limited v Spirit Pub Company (Managed) Limited, a lease renewal originally heard in 2025. The landlord, Pridewell, failed to satisfy ground (f) due to lack of evidence of its ability to fund works to redevelop and convert a pub into multi-purpose premises.  Pridewell appealed and the tenant, Spirit Pub, cross-appealed on 4 different grounds, one of which was that the County Court judge was wrong to conclude that Pridewell had established an intention to undertake the works within a reasonable period of time after the statutory tenancy ended.  

The facts are slightly unusual in that, at the date of trial and the appeal, Pridewell had not applied for planning permission for the works.  Before it could do so, it needed to carry out acoustic and investigative surveys at the premises but its right of entry under the lease did not allow for this and Spirit Pub had refused access.  Pridewell’s evidence was that it would be 6 months before it would apply for permission and that, in total, it could be between 10 - 14 months before permission would be granted and development work could start on site.  The County Court judge had acknowledged that this was an exceptionally long period to count as a reasonable time from expiry but concluded that the reasons preventing Pridewell from undertaking the surveys any earlier justified the length of time.  That meant the works would begin within a reasonable period of expiry.

Fancourt J refused Pridewell’s appeal on the funding point and, for that reason the appeal failed.  Even so, he went on to consider what decision he would have made on the tenant’s cross appeal, had Pridewell’s appeal been successful.  He agreed with Spirit Pub that the wrong question had been considered.  It was not a case of whether the delay could be justified in all the circumstances but rather whether a 10-14 month delay meant that the landlord did not intend to carry out the works within a reasonable time.  The concept of “within a reasonable time” introduced by the courts is simply a way of indicating that literal compliance with the statutory timeline is not required.  What that reasonable time is will be fact and property specific:

“It is likely to include time to recover, secure and clear out the property, depending on its size and condition, and time to mobilise contractors and take other preliminary steps, before work actually commences on site.”

In most cases this will be a short period but the judge gave examples of where this could be longer, such as where the development works are extensive or involve logistically challenging property, like an upper floor in a high-rise building in a densely developed urban area.  Even so, the tenor of the judgment is that the delay before work starts must be modest.  If, however, the works cannot start because the landlord needs to do something first which will take more than just a short time beyond the possession date, then that is evidence of a lack of intention to do the works during the required reasonable period of time.

While what the judge says is strictly obiter, it will be highly persuasive, not least because he was formerly a highly respected property barrister.  Pridewell is therefore left with premises that it cannot redevelop according to its current plans.  As the judge made clear, if it still wishes to proceed with the development it will need to seek a redevelopment break clause and to extend its right of entry to allow it to carry out the necessary surveys prior to exercising the break. 

A takeaway from this case is that landlords contemplating development must prepare themselves well in advance to ensure that they have sufficient access to premises to enable them to carry out whatever pre-planning surveys are required for any planning applications.