A dispute over the alleged failure of fashion brand Tessuti to open a new store in Dublin’s Jervis Street Shopping Centre has been admitted to the fast track Commercial Court.
The centre’s owners JSC Properties Ltd has brought proceedings against Tessuti (Ireland) Ltd and Tessuti Ltd. The Tessuti brand in the UK was acquired by Michael Ashley’s Frasers Group in late 2022.
JSC is asking the court to order the specific performance of a 10-year lease agreement last January with Tessuti (Ireland) to keep open for trade a ground and upper floor unit in the shopping centre.
It also seeks declarations that the defendants are required to pay rent and associated charges on the premises under the lease and that Tessuti Ltd is obliged to perform the lease as guarantor for Tussuti (Ireland).
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It further seeks judgment for some €1.72 million, primarily comprising rent due.
On Monday, Mr Justice Denis McDonald agreed to an application from Edward Farrelly SC, for JSC, to admit the case to the Commercial Court.
John O’Regan BL, for the defendants, opposed the application as his side had sought to engage with JSC with a view to mediating the dispute.
Mr Justice McDonald said he was certainly in favour of the parties engaging. However, the case came within the rules for admission to the commercial list and he was prepared to admit it and adjourn the matter to October.
He also gave directions for the progress of the case but said this could be done parallel with mediation efforts.
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In an affidavit seeking admission of the case to the Commercial Court, Shane McCrory, director of Garvagh Property Manager, which is JSC’s appointed property and asset manager, said that under the lease agreement Tessuti agreed to fit out the unit for immediate occupation.
Mr McCrory said there was a failure to commence the fit out works and the store did not open.
The sale of Tessuti UK in late 2022 to the Frasers Group meant JSC has been dealing with different parties over the last 12 months, he said.
Following numerous meetings and correspondence with representatives of the defendants during 2023, Mr McCrory said on June 21st last solicitors for the defendants informed JSC that the potential for opening a Frasers Group brand in the premises was “still being considered, seriously and in good faith”.
However, three days later, on June 24th, Companies Office accounts filed by Tessuti (Ireland) stated that after the Frasers Group acquired the company, Frasers decided not to open the Tessuti store in Ireland, he said.
It also stated: “The directors plan to orderly wind the company up in due course and not hold the company dormant for a future undetermined purpose”.
Mr McCrory said this came as a surprise to JSC. It now seeks that the issue is resolved as soon as possible because having an empty anchor tenant unit in the shopping centre causes ongoing loss.
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