Dunnes Stores has won a legal dispute against a discount store in an action where a High Court judge was asked to define what goods should be classified as groceries.
In his judgment Mr Justice Mark Sanfey said that the term “groceries” as contained in a lease agreement at the centre of a dispute between Dunnes Stores and the operator of a Mr Price store "extends beyond food or food products."
The judge also held that the term “groceries” includes “non-durable consumable household items which are purchased frequently."
Other items deemed to be groceries by the judge include healthcare products, household and cleaning products; pet care and pet food; bathroom toiletries; hair care products, detergents; washing powder; cleaning products; shampoos; toothbrushes; toothpaste; kitchen towels and toilet rolls.
Anchor tenant
The case concerned the opening of a Mr Price store in the Barrow Valley Retail Park on the Carlow/Laois border where Dunnes is the anchor tenant in its 65,000 square foot premises.
Dunnes claimed that as part of the deal for it to become the anchor tenant an exclusivity clause was contained in leases agreements with the holders of other units in the park to prevent them from being in competition with the supermarket chain.
Arising out of the opening of the Mr Price store in 2020, Dunnes and the retail park landlords, Camgill Property A Sé Ltd, brought proceedings against Dafora Unlimited Company and Corajio Unlimited Trading as "Mr Price Branded Bargains".
Dunnes claimed that in breach of the terms of its lease the operators Mr Price had been selling items from its outlet, namely groceries, in the retail park that it was not entitled to sell.
Represented by Martin Hayden SC it had sought a permanent injunction should be granted to prevent a Mr Price outlet selling certain items. The restrictive clause contained in the lease, Dunnes claimed, prevented any other leaseholder in the park from operating as a supermarket, hypermarket, grocery, discount food store, frozen food outlet, mini food market, convenience store or any similar premises for the sale of any food, food products or groceries.
The defendants denied the claims and rejected the categorisation of groceries advanced by Dunnes.
In his judgment where he found in favour of Dunnes, Mr Justice Sanfey said that the word “groceries” is one with which everybody is familiar.
He said that most people would be comfortable using the word and, if asked, would readily acknowledge its familiarity, and consider that they understand its meaning.
He said that if Mr Price removes all food products and groceries in compliance with his categorisation it will be in the court's view in compliance with the restrictive covenant.
This would remove the threat of competition in the retail park, which the restrictive clause in the lease was intended to address, he said.
The judge added that he was sure that the parties could come to a business-like arrangement over any items where there is a dispute, rather than resort to further legal action.
The matter will return before the court at a later date when final orders will be made in the action.
