James Naylor investigates the importance of interpretation
If it wasn’t quite a case of legal whodunit in Roadside Group Limited v Zara Commercial Limited [2010] EWHC 1950 (Ch) it wasn’t far off, in this helpful user covenant case. On appeal, the High Court investigated whether a sub-tenant could put a tenant in breach of its parking covenants. In deciding the case, the High Court provided useful guidance on interpreting user covenants, and, in particular, the effect of a draughtsman using an “active” or “passive” voice.
Z granted an underlease to R of a petrol station, car showroom (with two flats over it), service garage and hard standing. Z retained further land adjacent to and to the south of R’s demised premises. The underlease contained a parking user covenant: “Not to use the demised premises or any part thereof for the sale of motor vehicles by auction or for the parking of motor vehicles for sale on any forecourt” (the Parking Covenant).
R then granted a sub-lease of part to Triple Eight “which for some time ha[d] parked cars for sale in certain areas around the
