Barrel-Dregs, a Salutary Lesson!! (126)

By | September 24, 2010

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A SALUTARY LESSON !!

Pot Boy North was on a rare visit to the Midlands in search of mebbe the finest porter he knows, Hobson’s Postman’s Knock, when Eee Up, this sad little tale came to me notice. Admiral Taverns lease, last two tenants gone bust so its going dirt cheap. Middle aged businessman, local to this affluent commuter village, knows the pub well and reckons that he could make it fly. Talks to the BRM who surprise, surprise, has no trading figures but who categorically assures the fellow that the pub is easily capable of doing £6K a week. So certain is the BRM that the future rent being discussed is calculated accordingly.

The building (especially the many flat roofs) is in shoddy nick and our smooth talking BRM faithfully promises that “all the work will be covered by Admiral”. Fellow moves in on a six months tenancy at will to be converted into a 20 year lease automatically at the end of the initial six months. Our man sees the Admiral contractors start to work on the very extensive flat roofs at the same time as he is spending on the internal refurb. Admiral surveyor very apologetic, but has to take roofers off the job almost as soon as they started because of an urgent job where there has been a fire. Roofers never return and no other contractors put in an appearance except to replace two sets of french windows onto the trade patio. Time passes with “faithful assurances” that the mass of roofing  and exterior works will be done as soon as possible.

With the Admiral assurances (from a new BRM) ringing in his ears, the fellow signs up on the new full repairing and insuring supply tied lease. He has in the six months spent about £70K on a complete refurb of the interior. But ay oop, the roofs still leak like sieves and are ruining his new decor and making the electrics so unsound that he has to shut down the kitchen and can’t put on the planned live entertainment because the walls in the function room are ringing wet. He stops paying rent in protest as it was based on a £6K per week hoped for total sales, which are now about £2K (no kitchen, no entertainment).Admiral point to the repairing obligations in the full repairing lease for which he is fully responsible and ,booger ‘im, they want their rent or else they will tek possession.

Guess what, and this is from the daft fellows own mouth “to save a couple of grand I didn’t think I needed a lawyer, biggest mistake of my entire business life”. He had no schedule of condition attached to the new lease. No guarantees in writing of the works that were to be done by Admiral (now all flatly denied).No stepping up of the rental until the promised total sales were achieved. Nothing in writing from anybody at Admiral except the two documents for the six months tenancy and the new lease. So far he’s £70K down the tubes and the pub is shut whilst no rent is being paid. No beer is being delivered as the account is on stop and the certainty is that he won’t have the money to fight the inevitable Possession Order.

If only this were an isolated case but it happened this year,2010 to an otherwise successful local businessman. How can sane people be so blinded by promises and their own emotion and live on cloud nine. Please be warned if you are thinking of taking on a new life as a Publican. TAKE PROFESSIONAL ADVICE. The cost up front is cheap if you avoid the above true, very expensive and sad case.

Must get back off up the M6 and regards to all you soft Southerners.

PB North.

“This site is a privately funded website and growing in readership every day. To achieve a wider recognition the Editor would welcome cross referencing back to Barrel Dregs postings through other Blog or Websites. Information about our industry has so much greater power if more people are kept informed. Many thanks if you would be good enough to do this”.

The views expressed are not necessarily the editors and www.buyingapub.com accepts no responsibility for them, we do try to avoid offensive or litigious statements being made. They are written by concerned professionals in the industry who feel that these issues should be raised to ensure that all licensees are made fully aware of many hidden pitfalls.

 

3 thoughts on “Barrel-Dregs, a Salutary Lesson!! (126)

  1. Graham Sykes

    As an ex Brewery and PubCo Debt REcovery Manager I can advise any lessee, potential or existing, exactly what to do. Call me on 07789 260912 or see website or Facebook

    Reply
  2. Shafted

    PB, your blogs are incisive, revealing and very often oh, too true. As a shafted pubco-victim I must take issue at one ‘nasonism’ that appears in this salutary tale – ‘PROFESSIONAL ADVICE’ is NOT ENOUGH. It must be recent AND relevant experience in dealing with the thieving pubco sharks – they promise little and deliver even less – but EVERY time the onus is on the beleagured tenant to prove that that the sharks are constantly stealing the advantage in what fair-minded, honest, decent people would accept to be a ‘working relationship’. Best advice HAS to be – DO NOT TAKE A PUBCO LEASE until the buildings/dilapidations HAVE BEEN TOTALLY COMPLETED – work on the maxim that you will pay a full repairing lease – but ONLY on a FULLY REPAIRED property.

    Reply
  3. Reg

    How can anyone be expected to take on a full repairing lease without it being tip top to begin with? Surely a new lease cannot be granted without this being met? Isn’t this miss selling?

    Reply

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