Is Precise Drafting Going Out Of Fashion?

It is not uncommon in the retail sector, particularly in shopping centres, for tenants to demand from landlords an undertaking that the landlord will not lease neighbouring premises in its ownership to a business which might compete with, or otherwise impact on, the tenant's business. In such cases, there is an obvious tension between the landlord's desire not to overly restrict its right to lease and the tenant's desire to secure that the extent of the restriction will protect its interests.

In a recent Scottish case, Ralph Lauren has discovered how important it is that a tenant's intentions are properly expressed in such an undertaking.

The Facts

A landlord became Ralph Lauren's landlord in 2010.  Ralph Lauren made it known to the landlord that it was, and would continue to be, important to them that the high-end fashion retail "area" within the Merchant City was maintained. Indeed, this had been a precondition of their agreeing to take a lease of the