A beloved retail giant has escaped a contempt of court finding after “pushing the envelope” in complying with a legal order to keep a store open.
Marks and Spencer’s have been told it needs to do more to keep trading from its branch at the Plaza in East Kilbride.
The chain was taken to the Court of Session in July 2020 by its landlords Sapphire 16 S.A.R.L.
The property firm launched an action at Scotland’s highest civil court after it became aware through an East Kilbride News article that M&S were set to close the store.
Its lawyers told a judge last year that M&S’s plans breached a contract it had signed with Sapphire 16 obliging them to keep the store open until 2071.
Sapphire 16 then won an interim court order they believed forced M&S to keep the store open and trading.
However, lawyers for the commercial property firm returned to the Court of Session this year after it believed the retail chain was “doing the bare minimum” in complying with the order.
Its lawyers told Lord Braid that it was now operating as an outlet store selling ‘clearance’ stock.
The firm’s legal team also said some the store’s doors remained shut and windows were blacked out, giving shoppers the impression that it was closed.
The court also heard that the shop had minimum levels of stock and sales staff.
Lord Braid was told that a private detective who made two ‘covert’ visits to the store was told by staff that it was still set for closure.
On Friday, Lord Braid ruled that M&S hadn’t done enough to comply with the order.
He wrote: “A comparison of the store as it is currently trading with the store as it traded previously also leads to the conclusion that the store is not sufficiently stocked or staffed; and that this is so tends to be confirmed by the fact that there is no other store of this size operated by the defender as an outlet store.
“One is led to the inexorable conclusion that the defender is not interested in attracting business to its store, and that it is doing the bare minimum which it considers it need do in order to comply with its obligations.
“Were it otherwise, it would not have closed a main source of access to the store; it would not have blacked out its windows giving the impression that the store was closed; it would not have failed to exhibit a sign directing customers to the entrance which did remain open; and arguably it would not have signage to a food hall that manifestly no longer exists.
“That the defender is trading half-heartedly is further confirmed by: the defender’s avowed intention to close the premises; the low levels of stock within the store; the comments made by members of staff to the effect that the store is destined for closure; and the failure of staff consistently to wear M&S livery.
“If still further confirmation is required that the defender is not complying with its obligation to keep open for business in a good faith manner, the proof of the pudding, as it were, lies in the dearth of customers in the shop at a peak shopping time on a Saturday, and in the belief fostered among shoppers and other retailers that the premises are not open.”
The judgment tells of how the store is 27,400 square feet in size.
Before the first COVID lockdown, the shop had a food hall and sold men’s and women’s clothing.
The judgment tells of how during the first lockdown, the shop remained open to only sell food.
But by July 21 2020, there was only one shelf left selling ‘for sale biscuits and juice’. Shoppers were greeted with a sign telling them to visit the M&S branch in East Kilbride’s Kingsgate Retail Park.
The court heard that a few days earlier, an article appeared in the EK News saying that the shop was going to close.
This prompted the landlords to go to the Court of Session where they successfully obtained an order forcing the chain to keep operating from the site.
However, its lawyers returned to the Court of Session and asked Lord Braid to find that M&S had defied the order and was in contempt.
Its lawyers argued that the order passed required M&S “to keep the store sufficiently staffed, stocked, furnished and otherwise equipped.”
Lawyers for M&S claimed that it was complying with the order and it could operate the shop as an outlet store.
Lord Braid concluded that M&S hadn’t breached contempt laws as there was a “degree of uncertainty” with regard to the order.
He wrote: “In the modern vernacular, the defender has ‘pushed the envelope’ by doing what it considers the bare minimum in order to comply with the order. It is not enough.
“The defender must do more.
"While the decision is in some respects a marginal one, I will on this occasion give the defender the benefit of the doubt, recognising that there is some degree of uncertainty and that those taking the decisions relied upon legal advice.
“This does not of course mean that the defender is relieved of the obligation to comply with the order between now and final resolution of the case; nor does it mean that any future breach will not be held to be in contempt and met with a significant fine.
"However, I will decline to hold the defender in contempt at this stage.”
A spokesman for EK, East Kilbride, told us : "We are delighted with the decision from the Court of Session.
"M&S has been an important part of the EK community for many years and we look forward to working with the retailer to fully reopen their store in the town centre.”
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