P & S Amusements Ltd v Valley House Leisure Ltd & Anor, Court of Appeal - Chancery Division, February 02, 2006, [2006] EWHC 99 (Ch)

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P & S Amusements Ltd v Valley House Leisure Ltd & Anor, Court of Appeal - Chancery Division, February 02, 2006, [2006] EWHC 99 (Ch)

Case No: HC04 CO3315

Neutral Citation Number: [2006] EWHC 99 (Ch)

IN THE HIGH COURT OF JUSTICE

CHANCERY DIVISION

Royal Courts of Justice

Strand, London, WC2A 2LL

Date: 02/02/2006

Before :

MR JUSTICE PARK

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Between :

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Nigel Gerald (instructed by Turner Parkinson LLP) for the Claimant and Part 20 Defendant

Stephen Cogley (instructed by Shammah Nicholls) for the Defendants and Part 20 Claimants

Hearing dates: 28-30.11.2005 & 1-2, 5.12.2005

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Judgment

Mr Justice Park:

Abbreviations, dramatis personae, etc

1. These are as follows.

Overview

2. This case is about a beer tie in a lease of a bar and night club, known as Gaiety's, on the Golden Mile in Blackpool. The claimant, P&S, is the landlord. The first defendant, VHL, is the current tenant. The second defendant, Mr Peter Valentine, is the controlling shareholder in VHL, and for a time was the tenant of the bar himself. The lease was granted to a predecessor of Mr Valentine and VHL as tenant in 1991. The term of the lease is 20 years. The landlord, which has at all times been P&S, has the right under the beer tie provision to require the tenant to purchase its requirements of beer from the landlord's nominated supplier. In 1991 P&S nominated the brewery company, Matthew Brown. (Matthew Brown was and is a member of the Scottish & Newcastle group. Another member of that group was and is John Smith's. Scottish & Newcastle, Matthew Brown, and John Smith's have tended to be referred to interchangeably in the events which underlie the case and in the trial. For most purposes of this case they should be regarded effectively as the same person.) There was an arrangement or agreement between P&S and Scottish & Newcastle whereby, on quantities of beer purchased by the tenant, Scottish & Newcastle made payments, described as `discounts', to P&S.

3. That continued until 2002, but in that year Scottish & Newcastle terminated the arrangement between itself and P&S. Its subsidiary, John Smith's, continued to supply beer to the tenant, but Scottish & Newcastle stopped paying discounts to the landlord, P&S. P&S then gave notice under the beer tie provision that the tenant should buy its supplies of beer from a new nominated supplier, Carlsberg-Tetley. The tenant has not complied with the notice, which it says is not binding upon it, and has continued to buy its supplies from the Scottish & Newcastle group.

4. By this case: (1) P&S seeks an injunction restraining the tenant from purchasing its supplies of beer from John Smith's or any person other than its (the landlord's) nominated supplier; (2) P&S seeks an inquiry as to damages which it claims to have suffered by reason of breaches of the tie by the tenant; and (3) the tenant counterclaims for an order that P&S should pay to it an amount equal to the discounts received from Scottish & Newcastle, for which the tenant contends that P&S is accountable to itself...

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