1 All ER 256
Central London Property Trust Ltd v High Trees House Ltd
KING’S BENCH DIVISION
18 JULY 1946
18 July 1946. The following judgment was delivered.
On 27 September 1937, Central London Property Trust Ltd, the landlords, let a block of flats to High Trees House Ltd, the tenants, for a term of ninety-nine years from 29 September 1937, at a rent of £2,500 a year, the lease being by deed and properly executed. Those two companies were closely linked. The plaintiffs held all the shares of the defendant company (the tenants) and they were linked by directors and secretaries.
This new block of flats had not been fully occupied by the beginning of the war in 1939 owing to the absence of people from London; I think only one-third of it had been let by the outbreak of war. With war conditions prevailing, it was plain to those who ran these companies that the rent payable under the lease could not be paid out of the profits. In those circumstances, as a result of discussions, an arrangement was made between the directors concerned, which was put into writing. On 3 January 1940, the landlords wrote to the tenants in these terms:
“We confirm the arrangement made between us by which the ground rent should be reduced as from the commencement of the lease to £1,250 per annum”;