Tibsco Ltd & Ors v Baines

A renewal option conditioned on minimum purchases is enforceable unless the tenant establishes a properly arguable basis that the condition was waived, defeated by estoppel, unlawful, or otherwise inapplicable. Waiver requires an unambiguous representation, made by positive and intentional conduct with knowledge of the material circumstances, and reliance by the recipient. General encouragement to promote one product does not waive a different contractual purchasing condition. On a renewed permission application, a new and unpleaded argument supported by evidence not placed before the trial judge will ordinarily fail where there is no realistic prospect of amendment, fresh evidence, or success at trial.

The claimants sought possession of a tied public house after the respondent’s lease expired. The lease contained an option to renew, conditional on payment of rent and purchase of minimum quantities of designated drinks. The respondent purported to exercise the option but had apparently failed to meet the cider requirement.

The District Judge refused both the claimants’ summary judgment application and the respondent’s application to strike out for delay. His Honour Judge Peter Heppel QC, sitting as a High Court judge, dismissed the respondent’s appeal but allowed the claimants’ appeal, ordering possession and damages. The respondent sought renewed permission to appeal on waiver, estoppel, restraint of trade, and the interpretation of Regulation 1984/83. The central issue was whether any proposed ground had a real prospect of success.

1. The application for permission to appeal was refused. The respondent had no realistic prospect of overturning the finding that he had failed to satisfy the minimum cider-purchase condition. The case was also a second-tier appeal and raised no point of principle or practice requiring consideration.
2. The restraint-of-trade argument was new, unpleaded, and unsupported by evidence before the trial judge. The Monopolies and Mergers Commission report had not been put in evidence or mentioned at trial. There was no realistic prospect of permitting a fresh point and fresh evidence after the extended lease period had expired.
3. The evidence did not establish waiver or estoppel. The brewery employee’s encouragement to concentrate on beer and lager sales did not amount to an express or implied unambiguous representation that the cider-purchase condition could be disregarded. There was also no evidence that the respondent relied on any such concession. The condition operated as a pre-condition to exercising the renewal option, and silence or failure to complain about shortfalls did not establish waiver.
4. Even if the contractual provision were interpreted consistently with Regulation 1984/83, Article 8(2)(b) applied only where the specified circumstances existed, including more favourable supply conditions or differently branded drinks of the same type. There was no evidential basis that either circumstance arose.
5. The order for possession and damages therefore remained undisturbed. Lord Justice Robert Walker agreed with Lord Justice Aldous.

• Court of Appeal (Civil Division): refused renewed permission to appeal on 14 August 2001.
• High Court, sitting on appeal from the District Judge: His Honour Judge Peter Heppel QC dismissed the respondent’s appeal and allowed the claimants’ appeal, ordering delivery of possession and payment of damages.
• District Judge: refused the respondent’s application to strike out for delay and dismissed the claimants’ application for summary judgment.