HT-2022-000311 & HT-2022-000254 - [2024] EWHC 3179 (TCC)

As I have said, the primary basis for RTM’s claims against both defendants, arises under the FPA. In the FPA, Click St Andrews was referred to as the Seller, RTM as the Buyer and Click Group Holdings as the Guarantor. The Property was defined as the freehold and leasehold property known as St Andrew’s House, 381 Southwark Park Road, London SE16 2JT.

The FPA contained the following Recitals:

“Background

(1)

On 4 January 2019 the participating tenants (as defined by the 1993 Act) served upon the Seller a Notice pursuant to Section 13 of the 1993 Act (“Section 13 Notice”) claiming the right to purchase the freehold of the property.

(2)

On 11 March 2019 the Seller served upon the Buyer a Notice pursuant to Section 21 of the 1993 Act admitting that the participating tenants were entitled to exercise the right to collective enfranchisement in relation to the Property.

(3)

This Agreement is being entered into in pursuance to the Section 13 Notice whereby the Buyer was appointed as the Nominee Purchaser for the purposes of Section 15 of the 1993 Act.

(4)

The Guarantor has agreed to guarantee the performance of the Seller under this Agreement and be joined as a party.”

Clause 1 (Definitions) included the following definitions:

Clause 5 (Works) provided :

“…

5.2

The Seller shall use all reasonable endeavours to procure that the Works are carried out:

(a)

with due diligence and in a good and workmanlike manner;

(b)

using only good quality materials and well-maintained plant and equipment

(c)

In accordance with this Agreement, the Planning Permission, and the Requisite Consents in respect of the Works;

(d)

In accordance with all statutory or other legal requirements and the recommendations or requirements of the local authority or statutory undertakings:

(e)

in compliance with all British Standards, codes or practices and good building practice

…..

(g)

causing as little annoyance disturbance and nuisance to the Tenants as is reasonable possible;

(h)

and making good any damage caused to the Property to the reasonable satisfaction of the Buyer; ….”

Clause 6 was concerned with Works Insurance and will be referred to briefly below.

Clause 13 provided:

“13.1

This Agreement is conditional on the Seller completing the Works in accordance with the terms of this Agreement.

13.2

Immediately the Seller has completed the Works and obtained the necessary Building Regulations Completion Certificates in relation to the Works, the Seller shall give written notice of that fact to the Buyer including supplying the said Building Regulations Completion Certificates, such notice to be sent by courier to the Buyer’s Solicitor (the “Completion Notice”).

13.3

This Agreement shall become unconditional immediately on receipt by the Buyer’s Solicitor of the Completion Notice.

13.4

The Completion Date is 10 working days after this Agreement shall have become unconditional pursuant to clause 13.3 above.

13.5

If the Seller has not served the Completion Notice on the Buyer’s Solicitor in accordance with this clause 13 by the Initial Longstop Date then the Initial Longstop Date shall be extended for a further year (“Extended Longstop Date”). …

13.6

If the Seller has not provided the Completion Notice by the Extended Longstop Date either party may at any time afterwards but before receipt of the Buyer’s Solicitor of the Completion Notice serve written notice on the other rescinding this agreement and neither party shall have any claims against the other in respect of the Agreement and Standard Condition 10.1 shall apply.”

Clause 14 (Leaseback) provided that on Completion the Buyer will grant to the Seller the Leaseback.

Clause 17 Guarantee and Indemnity) was in the following terms:

“17.1

The Guarantor guarantees the due and punctual performance by the Seller of all the Seller’s duties and obligations under the Agreement.

17.2

If the Seller fails to observe or perform any of its duties or obligations under this Agreement, or if the Seller fails to pay any sum, loss, debt, damage, interest, cost or expense due from the Seller to the Buyer under or in connection with this Agreement, the Guarantor (as a separate and independent obligation and liability from its obligations and liabilities under clause 17.1) shall indemnity the Buyer against all loss, debt, damage, interest, payments, charges, cost and expense incurred by the Buyer by reasons of such failure or non-payment and shall, on first written demand, pay to the Buyer, without deduction or set-off, the amount of that loss, debt, damage, interest, payment, charges, cost and expense.

…”

Clause 18 (Buyer does not have to pursue Seller) provided that the Buyer does not have to pursue any remedy against the Seller before proceedings against the Guarantor under the FPA.