The John Lewis Partnership faces legal action in the High Court over click-and-collect rent payments at Brent Cross shopping centre. The dispute, worth millions in potential backdated rent, centres on a 1972 lease that predated the internet by decades.
Case Details
Hammerson and Standard Life, current and former owners of Brent Cross, claim John Lewis underpaid rent for over a decade by excluding online click-and-collect orders from in-store sales figures. The lease requires a base rent of £30,000 plus turnover top-ups: 0.75% on sales between £4m-£10m, 1% above £10m. Industry sources estimate the store’s annual takings at £50m, implying a rent of roughly £475,000.
Generous anchor tenant deals were common in the 1970s when landlords offered cut-price rents to major retailers like John Lewis, BHS, and M&S to attract footfall. Decades later, these legacy leases face scrutiny in a changed retail landscape.
Legal Dispute
The core issue is the definition of “gross receipts”. Landlords argue this includes online orders collected or fulfilled at the store, plus in-store orders dispatched later. They cite lease language covering “mail, telephone or similar orders received or filled at or from” the premises, and orders “originated and/or accepted at or from the demised premises” regardless of delivery location.
John Lewis contests the claim, arguing a pre-internet lease couldn’t reasonably include e-commerce. A rival landlord supports this view: “The sale occurs at the click, not the collect. You can’t argue there was intent to include click-and-collect because the internet didn’t exist in the seventies.”
Hammerson also criticises John Lewis’s reporting. The lease requires audited sales certificates signed by accountants. For 12 years, these came with caveats that the accountants’ examination “was not such as to constitute an audit” and lacked sales breakdowns. Landlords suspect some certificates omitted sums that should have been included.
Broader Implications
The remedy sought is far-reaching. Claimants want the court to compel John Lewis to produce detailed sales breakdowns since 2013, with backdated rent, interest, and costs if figures show click-and-collect was excluded.
For SME retailers and landlords, the implications are considerable. Turnover-linked rents, once niche, have spread since the pandemic as landlords offered flexibility for upside participation. How courts interpret the 1972 lease wording could set benchmarks for recent agreements silent on omnichannel trading.
The case raises uncomfortable questions for hybrid retailers. If click-and-collect orders are fulfilled from a back-of-store stockroom, is the shop a shop, warehouse, or both? The answer matters for rent, business rates, insurance, and planning classifications.
A trial date is unset. The outcome will be studied by property directors, finance chiefs, and retail lawyers with turnover leases.