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EU body granted permission to appeal ruling on Brexit and frustration of Canary Wharf lease

A High Court judge has granted the European Medicines Agency (EMA) permission to appeal in a dispute over whether its 25-year lease at Canary Wharf will be frustrated by Brexit.

The EMA, an agency of the European Union, had written to the landlords of the lease and the management company for the Canary Wharf, the claimants, in August 2017 to say that if and when Brexit occurred, it would be treating that event as a frustration of the lease. The EMA’s underlease is dated 21 October 2014.

In Canary Wharf (BP4) T1 Ltd & Ors v European Medicines Agency [2019] EWHC 335 (Ch) Mr Justice Marcus Smith ruled against the EMA last month.

The judge concluded that:

  • The lease would not be frustrated on the withdrawal of the United Kingdom from the European Union.
  • This was neither a case of frustration by supervening illegality nor one of frustration of common purpose.
  • The lease would not be discharged by frustration on the United Kingdom's transition from Member State of the European Union to third country nor did the EMA's shift of headquarters from London to Amsterdam constitute a frustrating event.
  • The EMA remained obliged to perform its obligations under the Lease.

According to Blackstone Chambers, whose Thomas de la Mare QC and James Segan are appearing for the EMA, Mr Justice Marcus Smith in a decision issued on 1 March said that the EMA should have permission to appeal against his decision to the Court of Appeal, holding that an appeal had a real prospect of success and that there was a compelling reason to grant permission.

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