Overview

A developer marketing a site to prospective tenants may make a number of statements and predictions about the completed development, both in the marketing literature itself and in the course of negotiations. If the development fails to perform as expected, what recourse does the tenant have against the developer?

This was the issue for the High Court in FoodCo UK LLP and others v Henry Boot Developments Limited. The developer obtained planning permission for a motorway service area (MSA) off the M20 in Kent. The MSA was not accessed directly from the motorway itself, but rather from a roundabout just off the junction. The marketing literature had predicted 88,000 visitors a week. In fact, visitors barely reached a tenth of that number.

A number of the tenants sued the developer, alleging that the developer had made a number of misrepresentations which had induced them to sign up to take leases at the site. The alleged misrepresentations included statements in the marketing literature that: the development would be an MSA; estimated visitor numbers on opening would be 4.6 million; the development would have live departure information for cross-channel ferries and Eurotunnel.

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