Tesco receives undertakings from in-store homewares business not to close down

Tim Healy

Tesco Ireland Ltd has received High Court undertakings from an interiors/homewares chain not to shut their outlet which is within a Tesco superstore in Waterford city.

Multi Home Retail Ltd t/a Choice Stores started removing its stock over the weekend of January 17th/18th from the Poleberry Tesco which then sought an injunction against it for alleged breach of a 10-year licensing agreement to operate the in-store outlet.

On Thursday, Mr Justice Brian Cregan adjourned the matter to next month following undertakings on behalf of Choice to keep the outlet open pending the determination of the proceedings.

Andrew Fitzpatrick SC, for Tesco, said the "keep open" would meet a term of the injunction being sought by his client. John Freeman BL, for Choice, said he would be seeking an early hearing date.

Choice has occupied a 13,239 square foot unit in the shared superstore area at an annual licence fee of some €214,000 since September 2024.

Tony Kiernan, head of assets and estates with Tesco Ireland, said in an affidavit that there is a "break option" in the licence agreement in the fifth year.

But on December 8th last, just over a year into the agreement, Choice wrote to Tesco saying they would be withdrawing from Poleberry on foot of "a commercial decision".

Engagement followed between the parties, with Tesco requesting that Choice provide a viable and realistic proposal so it could continue trading.

But, Mr Kiernan said, Choice managing director Ken Fox wrote back to say the wind-down decision stands, and it was intended the last trading day would be a date in January with a hand back in February.

Mr Fox also later stated there were provisions in the licence agreement which allow for termination in certain circumstances. Tesco says there is no such provision.

Mr Kiernan said Choice continued removing stock from the store with the result that by January 26th, it was substantially reduced.

He also said if Choice is permitted to withdraw, the presence of a large and conspicuous vacant unit in a prominent location posed a real and material risk of reputational and commercial harm to the centre and its occupiers.