24 Nov 2016
Policy area: Town centre & Retail
The body representing commercial landlords today condemned the Company Voluntary Arrangement (CVA) proposal by the coffee chain Love Coffee, whose attempts to avoid the terms of their contracts are set to leave landlords and local authorities unpaid.
The British Property Federation (BPF) called the CVA put forward by Love Coffee a massive step backwards with regards to open and transparent insolvency negotiations, as the company:
The CVA comes after directors of Love Coffee took out substantial dividends between 2013-14. Whilst further investment is promised in the event that the CVA is approved, there is no guarantee of this or indication of where the additional funding will come from.
Ian Fletcher, director of policy at the British Property Federation, commented: “The CVA put forward by Love Coffee represents the very worst example of insolvency negotiations we have seen, and is unacceptable in its treatment of landlords who have fulfilled their obligations, only to be ignored and left out of pocket. The company also leaves the taxpayer short with unpaid business rates bills.
“The directors of Love Coffee have taken a highly unorthodox, selective approach to deciding which creditors they see fit to pay, and its insolvency practitioner should be scrutinised by their regulators.”