Click-and-collect-rent?

You don't have to look far in real estate to find laws and conventions that emerged in different times but continue to prevail in the modern age. From business rates and leasehold to the concept of chancel repair liability, property is full of obligations that have their roots decades or even centuries in the past and, perhaps unsurprisingly, aren't always ideally-suited to the modern economy.

A High Court claim lodged this week might add the lease - that most everyday of real estate contracts - to the list of instruments that is struggling to cope with the sector's rapid change. It has been widely reported that Hammerson and Standard Life (now part of Aberdeen), the current and previous owners of Brent Cross shopping centre in north London, are suing John Lewis for underpaid rent relating to click-and-collect sales at the retailer's store in the scheme.

The case rests on a provision in John Lewis' 125-year lease, signed in the 1970s, that requires the retailer to pay a percentage of its gross sales in what is effectively a turnover rent. While the clause explicitly references "mail, telephone or similar orders", it notably omits online sales, for the very good reason that the world wide web wasn't invented until 1989. Hammerson and Standard Life claim online sales collected at the store should be included in "gross receipts" figures; John Lewis, while not having commented, presumably thinks otherwise.

The ramifications of the judgement, when it arrives, are clearly significant. This will be a test case, and any landlord with a retailer paying a turnover rent - particularly those on historic leases - will be playing close attention. Both sides have good cases to make, and weighing up the arguments will be complex; suffice to say Big Picture is glad that deciding who is right falls to more qualified people.

Regardless of the outcome in court, navigating the tension between physical and online sales will remain a tricky business. Some will point to broad provisions that could arguably encompass online sales, while others will note that landlords still benefit from click-and-collect activity through heightened footfall. In the wider market, there is also the question of store viability. Outlets in some locations only make sense if they are collection hubs as well as points-of-sale; for many owners, it will be worth swerving a dispute if it also means you avoid a vacant unit.

But maybe the big lesson here is that even the most stringently drafted agreement, undertaken and enacted in good faith by both parties, leaves plenty of room for ambiguity. If changing times create a legal dispute in a contract as relatively 'vanilla' as a lease, then what about more complicated arrangements?

Maybe this is a rare situation, unlikely to rise again, where happenstance has seen a lease straddle an era-defining innovation. But in a sector that has seen huge shifts over the past 20 years, and technology still accelerating, investors and retailers alike would do well to consider an 'unknown developments' factor when signing on the dotted line. Predicting the future is no easy task, but as Big Picture has said before, that is all part of the real estate game.