Sports Direct has entered a High Court battle with JP Morgan over a £5.4m bill the investment bank claims it is owed for leaving a vacant unit in a state of disrepair.
The sportswear retailer left the complex in Wigan in 2019 after taking advantage of a break clause in its 10-year lease that was signed in 2014.
The retailer has been accused of not completing most of the refurbishment work it was contractually required to do before it vacated, breaching some covenants and causing “loss and damage”, according to court documents filed by the bank.
Lawyers for JP Morgan Europe said that Sports Direct had more than six months to make good “any alterations, cover up or changes it made without the landlord’s consent” – work that the bank had to complete before it could lease the complex out again.
Subscribe to Retail Gazette for free
Sign up here to get the latest news straight into your inbox each morning
The premises included a distribution centre, office and warehouse space, as well as car parks and two helicopter hangers.
JP Morgan Europe said: “In the final six weeks of the term of the lease, [Sports Direct] started removing the mezzanines and racking.
“They made a poor job of this and ran out of time . . . there was considerable debris on site, numerous projecting fixing bolts in the floor, and poorly disconnected services including safety equipment such as the fire alarm and sprinklers.”
The bank is claiming £5.4m pertaining to £3.3m of refurbishment costs, £1.8m in lost rent and the interest accrued from November 2022.
JP Morgan Europe claims it provided Sports Direct with a report in November last year breaking down the various costs, but that the retailer did not respond under a so-called dilapidations protocol at the time.
The story was first reported by The Financial Times.
Click here to sign up to Retail Gazette‘s free daily email newsletter
