John Lewis sued by Brent Cross landlords over click-and-collect service

The landlord of London shopping centre Brent Cross is suing John Lewis for a share of its click-and-collect sales, claiming that the department store should pay for online sales collected in-store.

In a joint filing with the High Court, Hammerson and former landlord Standard Life Investments have requested clarification on whether sales made via click-and-collect should be included in a turnover rent agreement first made in 1979, according to the Financial Times.

In response, John Lewis argued that sales related to click-and-collect purchases should not apply to the deal because a transaction concludes when the order is dispatched from the distribution centre, rather than when the customer collects it from the store.

Speaking to FashionUnited, Cara Imbrailo, partner in the real estate team at law firm Charles Russell Speechlys, said the rise of e-commerce has brought into question the validity of click-and-collect sales in relation to turnover rent, and the answer isn’t all that straightforward.

Imbrailo added: “With turnover rents, there is unlikely to be a one-size-fits-all answer. The right approach depends on the tenant, the brand, the format of the store and the proportion of online sales in that particular business.

“Increasingly, we are seeing parties negotiate turnover provisions that are personal to the specific tenant - sometimes recorded in a side letter rather than documented in the lease itself.”

In the case of John Lewis’ Brent Cross lease, turnover provisions were drafted decades before the emergence of e-commerce and click-and-collect, Imbrailo notes, making them out of sync with modern retail habits.

As a result, Imbrailo envisions an increase in litigation between landlords and tenants on how these provisions should be applied today. “But this doesn’t need to be the only route. Landlords and tenants may look to modernise the position collaboratively, whether on lease renewal or as part of a regear or variation of terms,” she added.

FashionUnited has contacted John Lewis with request to comment.