Nick Brown and Alex Poole-Wilson consider a recent court
All retailers in occupation of premises will be familiar with the
constraints imposed on their use of premises by both the user
provisions in their occupational leases and the need for planning
However, if the approach adopted in a recent
planning case is to be followed generally, then retailers may find
themselves having more flexibility than they previously
The particular decision (R -v- Maldon District
Council Ex Parte Pattani, The Times, 7.11.1997) related to a food
supermarket where the planning permission and associated planning
agreement limited the use of the premises to a supermarket and
prohibited the sale of any goods other than "food and associated
When the retailer at the premises decided to provide pharmaceutical
services from the supermarket premises, the courts were faced with
the question of whether the planning conditions and/or agreement
had been breached. It was held they had not.
The court believed that permission to develop and
use the site as a "supermarket" included permission to trade in
anything "which could ordinarily and properly be regarded as
obtainable in a supermarket whose primary function was to sell
food". Pharmaceuticals were "associated household consumables"
because they were commonly and normally found in supermarkets and
so had an association with food in terms of shopping.
The full planning implications of this approach
remain to be seen. However, in a climate where supermarkets and
other retailers are responding to the growing demand for the range
of facilities available in their stores to include items such as
banking and coffee shops (and, according to recent press reports,
doctor's surgeries), it is possible that the user provisions in
leases of supermarket premises may be interpreted more widely in
the future. It is nowadays far from rare to find a supermarket
selling children's clothing, cd discs and tapes and books and the
further this trend develops the more likely it is that widely
drafted permitted users in leases providing for a general
supermarket or similar use will be interpreted to include these and
other items commonly being sold in supermarkets. This could also
have rent review implications.
This approach could, potentially, have implications
for a number of different types of retailers. We are now seeing
book retailers expanding into providing coffee shops as part of
their facilities. If this becomes the norm then could a permitted
use of "bookshop" be extended to generally include this type of
If this approach is adopted more widely then
landlords will no doubt look more closely at the wording of user
clauses and may not agree to general uses along the lines of
"supermarket" or "bookshop".
This is an area which has great potential for
development and only time will tell the extent to which the courts
are prepared to take this flexible approach to the interpretation
of user clauses.
Capital allowances on sales and purchases of secondhand
Richard Croker reports on the current rules relating to
It is not only property investors who should be interested in
capital allowances. Retailers who are owner-occupiers or who incur
capital expenditure on fitting out leased property will, generally,
have the opportunity to claim capital allowances. Last year's
Finance Act changed the rules governing capital allowances on plant
and machinery fixed to property - in particular on sales and
purchases and all should be aware of the degree of flexibility
these rules now offer.
25% of total expenditure on plant and machinery is
available as tax relief, in the first year. A further 25% of the
written down expenditure is available in the next year, and so on.
With corporation tax rates at 31%, a net saving of 7.75% of the
expenditure can be made in the first year.