According to our expert consultant, Dave Mountford, currently assisting Linda and Gary, this is sadly an all too familiar experience.
Over 15 years ago, the couple took on the Marston’s Pubs site, to realise a long-cherished dream of opening their own pub. The Grade II listed property had been visibly neglected, prompting them to arrange a survey prior to signing the lease. The inspection uncovered several defects around the building, including damage to an external wall.
Starting with a sum of £50,000 the couple have invested heavily in the pub over the years with their total personal investment now exceeding £100,000. From the positive customer support voiced online, it is clear the site is both well run and a valuable hub of the community.
After 15 years of successfully running the Queens Arms as tied tenants, making substantial profits for Marston’s, the couple chose to exercise their right to go free of tie. In response, Marston’s Pubs now demands that the external wall is rebuilt, despite the fact that it was damaged prior to the lease being signed, and served Linda and Gary with a schedule of dilapidations bill exceeding £75,000.
Marston’s never mentioned dilapidations until the publicans sought to become free of tie. Linda specifically remembers feeling pressured and bullied into signing the 21-year lease. In all this time, they have never received business support from Marston’s Pubs.
During a highly publicised challenge against Heineken-owned Star Pubs & Bars back in 2018, the Pubs Code Adjudicator (PCA) made the following ruling in relation to their attempt to impose a dilapidations schedule:
“There can be no real doubt that, when the cost of dilapidations is high, the requirement for their immediate or short term payment may represent a real disincentive to a TPT to take the MRO option.
A reasonable landlord [pub owning business] should manage its estate responsibly throughout the term. The landlord should not be using surprises on the request for an MRO option as an adversarial weapon.”
This means that the dilapidations should not and cannot be imposed upon a tenant in response to them seeking a Market Rent Only (MRO) agreement. This is clearly a tactic designed to pressure and dissuade tenants from breaking the profitable beer tie.