Martin’s Commercial Limited v Cineworld Cinemas Holdings Limited

The Commercial Rent (Coronavirus) Act 2022 confers substantive rights concerning relief from protected rent debts independently of its statutory moratorium on enforcement remedies. The statutory arbitration provisions are not implicitly restricted to proceedings issued on or after 10 November 2021 merely because the moratorium provisions apply by reference to that date.

Where earlier proceedings prevent use of the statutory moratorium, the court may use its inherent jurisdiction to stay those proceedings pending arbitration. That jurisdiction is discretionary. Parliamentary material may be consulted only where the statutory language is ambiguous, obscure or produces an absurdity; an oddity in the statutory scheme is insufficient.

The claimant, the freehold owner of premises let as a cinema, sued the defendant guarantor for rent arrears issued before 10 November 2021. The tenant later referred the protected rent debt to arbitration under the Commercial Rent (Coronavirus) Act 2022.

The Deputy Master held that the Act applied to the proceedings and that the court could stay them under its inherent jurisdiction pending arbitration. The appeal concerned whether the Act applied to proceedings commenced before 10 November 2021 and, if so, whether a stay could be ordered despite the unavailability of the statutory stay under section 23 and Schedule 2.

1. Appeal dismissed. The court agreed with the Deputy Master on both grounds.
2. The Act had to be construed as a whole, having regard to its context and purpose. Although legislation should not ordinarily deprive a party of accrued rights retrospectively without clear words or necessary implication, this Act clearly altered accrued rent rights in some circumstances.
3. Sections 9, 13 and 14, in Part 2, conferred substantive rights concerning protected rent debts. Section 23 and Schedule 2, in Part 3, created a procedural moratorium applying to specified debt claims. It would be a strained construction for procedural provisions dealing with enforcement remedies to impose an unstated restriction on the substantive arbitration rights.
4. The absence of a statutory moratorium for proceedings commenced before 10 November 2021 did not remove the tenant’s substantive right to seek relief. The court therefore retained an inherent jurisdiction to stay the proceedings pending determination by the arbitrator. The stay was discretionary and could in principle be refused for improper conduct.
5. The statutory scheme contained an oddity but no ambiguity or absurdity of the kind required by Pepper v Hart. The ministerial statement in Hansard, even if potentially supportive, could not be relied upon because the statutory threshold for consulting parliamentary material was not met.
6. The hearing was formally adjourned to deal with consequential matters, and the time for any application for permission to appeal was extended to 21 days from that hearing.

• High Court, Chancery Appeal: Appeal from the decision of Deputy Master McQuail. Appeal dismissed.