The European Medicines Agency (EMA) has settled its case with Canary Wharf so will not be arguing that its lease with Canary Wharf will be frustrated on the withdrawal of the UK from the EU. The EMA will be sub-leasing its property to WeWork, which deals with the £500m financial headache the EMA was facing.
Our February blog explained that Mr Justice Marcus Smith had rejected the EMA’s arguments that continuing the lease would be outside its powers after Brexit. He also held that when entering the lease, there was no common purpose between the parties that the consequences of EMA abandoning its headquarters would be dependant on the reason for the departure. The judge narrowly construed the doctrine of frustration to deny EMA the ability to be released from the lease. As the appeal has not been pursued this remains the law.
Accordingly, the doctrine of frustration has not yet been successfully argued to extricate any party from a lease. There remains the possibility of arguing that Brexit is a frustrating event for other contracts, in the relevant circumstances.