City pub faces closure after ‘devastating’ arbitration judgment

The Harrison, a live music venue, pub and hotel, is filing an appeal against its landlord, Wellington Pub Group, which legal advisers have estimated could cost a minimum of between £15,000 and £30,000.  

The organisation, which is owned by billionaire brothers David and Simon Reuben and holds approximately 850 tenanted pubs, has demanded the business pay rent for the entire period during it was closed for business due to lockdowns and coronavirus restrictions.

This includes a more than five-month closure between March and September 2020, after which the pub was closed for intermittent spells until May 2021.

The Harrison’s licensee, Paul Michelmore said: “These arbitrations are the plugholes through which billionaire landlords drain money from our society. We’ve been here for nearly 20 years, and the landlord is destroying it for the sake of a couple of hundred thousand. The whole thing will go, and I will be personally bankrupt”.  

According to Michelmore, the arbitration order holds a plethora of inaccuracies, including a claim the pub received £290,000 in Covid grants and loan. The transactions presented to justify that total included payments from customers and from Michelmore’s own personal account into the business. 

He also said the judgement used direct cost expenditure as evidence the business had “loads of spare money”: “Profits have been down since the pandemic. That money goes towards running the business - it pays staff and pays for supplies. It’s a ridiculous argument”.

Michelmore, who took over the pub in 2004, has invested £290,000 of his own money into the building since the beginning of his ownership. If the court order is upheld, he will be unable to pay and the pub will go under.

“The arbitrator is asking me to pay £5,200 a month for 19 months - that’s double the most we’ve ever made in profit”, he added.

Due to legal stipulations, the business is unable to appeal the facts presented within the arbitration order, but can appeal on the basis of procedural mistakes.

Only option

“There is no regulation, and the system is open to manipulation”, said Michelmore.

Citing “very little scope to challenge” the order, Michelmore said he initially considered “just taking the loss and going bankrupt now, about £150,000”.

He added an appeal potentially stands to increase his debts: “This is my only option to fight it, but might not even be a sensible one. If I lose, I might be liable for the other sides legal fees, which could amount to £40,000.”

While the closure stands to financially devastate Michelmore personally, it would also break up a “very close family who have worked together for a long time”.

Assistant manager Hugh Somerville said: “This is a business I have fought for, loved and become inextricably part of over 17 years. It will be like being taken away from a family. Some staff here have established bonds with each other and the customers over many years and the loss will be massive and many, including me, I'm sure will feel bereft.”

The closure also stands to place enormous financial strain on employees, including Michelmore’s housekeeper, who lives on site and will be made homeless.

General manager Sophie Nordlund, who has worked at the Harrison for 15 years, said: “It would be a very sad end to a massive part of my life. I love this place, but of course, it would also mean the end of my income. With the cost of living getting higher and higher, I would definitely be struggling. My partner and I wouldn’t survive solely on his income more than a short time”.

Since Michelmore launched an online ‘Save the Harrison’ Collection Pot​ after receiving the court order on 21 March, the pub has received an outcry of support from locals and regulars who see the Harrison as what Nordlund described as a “home away from home”.

“The love we have received has been enormous. Our promoters have turned some of their gigs into fund raisers, to help us with legal costs. We are a very important little hub here in Kings Cross”, she added.

The support has also extended to local government level, with the Mayor of London’s Culture at Risk Office and Camden Council offering to contribute a combined total of £8,000 towards the appeal.

Local support

London night czar Amy Lamé, said: ​“The Harrison and its folk and roots gigs have been a part of life in Kings Cross for nearly 20 years and alongside the Mayor’s Culture and Community Spaces at Risk programme I am working closely with Camden Council to offer all the support we can. These businesses have had an incredibly difficult few years due to the impact of the pandemic and the spiralling cost of operating, but the Mayor is committed to doing all he can to help”.

The Music Venue Trust has also offered its backing to the Harrison and will launch a campaign to back the venue’s appeal this week.

“It almost brings me to tears”, said Michelmore of the support. He added that he has been spurred on to explore legal avenues by local backing. “We’ve just been quietly running a business and have now realised how important it is to the community”.

The Wellington Pub Company, which has been involved in a number of disputes with tenants since the beginning of the pandemic period​, was asked for comment for this article, with no response.

Where independent businesses such as the Harrison have much at stake in meeting large corporations in court, their significant role within local communities serves as an encouraging foundation.  

“We are living in a world where small independent businesses are becoming rarer and rarer. When people step through our doors they are charmed by a place that is truly authentic”, said Somerville. “Pubs mean a lot to people; if you lose one, you lose human histories, connections, and a stage for a community's soul.”

Camden councillor Danny Beales said: “The Harrison has hosted grassroots music for many years and is part of Camden’s rich cultural offering. It would be a huge loss to the area to see this venue close. Both Camden Council and the Greater London Authority are in close contact with The Harrison about the next steps it could take and will continue to provide advice and support.”

Since the pandemic, arbitration orders of the kind facing the Harrison have increased in frequency, where the Commercial Rent (Coronavirus) Act 2022 allowed for matters of rent relief for businesses to be resolved by arbitration if not by agreement between tenant and landlord.

Michelmore said that he believes this to have led to “miscarriages of justice” for publicans across the UK.

The ‘Save the Harrison’ Collection Pot​ has raised £4,219 as of 13 April and has already helped to fund the business’ legal fees.

“It is common knowledge among publicans such as myself that arbitrations should be avoided at all costs- there is very little oversight and they tend to fall in favour of the landlord”, added Michelmore.“The support we have received has reassured us this is the right path, it is worth saving”.