Keep Open Covenant In A Lease

The recent High Court decision in Thomas Thompson Holdings & others v Musgrave Group plc & others  considered the enforcement of a "keep open" covenant in a lease and whether the tenant of the anchor supermarket unit in Carlow Shopping Centre would be forced to keep trading where it was operating at a loss.

There is no clear Irish authority on the enforceability of "keep open" covenants and no case law showing that an injunction will be granted compelling a person to carry on a business where the business is a losing concern.

Background

In December 2015 Musgrave announced in the national media its intention to close the Supervalu store in the Centre in January 2016. The Plaintiff, the owners of Carlow Shopping Centre, sought an injunction restraining Musgrave from closing its Supervalu store, in clear breach of the "keep open" covenant in the lease. The Plaintiff claimed that this would cause irrevocable and irreparable damage to them and to the third