Once the jewel of Glasgow’s culinary scene and the go-to spot for celeb spotting, Rogano was the iconic restaurant where you’d sip on cocktails in an ambiance so chic it made you wonder if you’d stepped into a 1930s film set. But now, the Art Deco icon is closed – its opulent interior collecting dust, and its loyal patrons left reminiscing over the good old days.
Despite closure, the Glasgow Institution has retained its fame but sadly not for its lobster thermidor. Instead, the iconic restaurant is at the centre of a legal battle over “insured risk”. Rogano, like many restaurants, was forced to batten down the hatches back in December 2020 due to the COVID-19 pandemic. Sadly, the hatches weren’t battened down quite tightly enough and after three instances of flood related water damage, the temporary closure became permanent.
The damage has led to well publicised disputes between the restaurant’s operator, Forthwell Ltd and its landlord, Pontegadea UK Ltd over repair obligations and insurance responsibilities. Unable to resolve matters amicably, Forthwell’s legal bid against their landlord has now reached the dizzy heights of Scotland’s highest civil court.
Without getting into the nitty gritty of the case, the Rogano saga highlights issues not only surrounding rental obligations but also around how insured risks are managed when a property is damaged or unusable due to circumstances outlined in insurance policies. Such disputes often arise when the expectations around who should maintain insurance and how any payout should be used are not clearly defined or understood. In Scottish commercial leases, the insured risk clause serves to protect both landlords and tenants by detailing who should insure and under what conditions. Typically, landlords will take out a building insurance policy covering structural risks, while tenants may be responsible for insuring contents and specific internal fittings. The lease should also dictate the obligations regarding rental payments if the property becomes uninhabitable due to an insured event.
Whether you are a landlord or a tenant, it’s important to scrutinise the repairing and insurance obligations closely. Such factors are often overlooked when signing a lease, but their importance cannot be overstated. Key clauses in your lease should clarify:
- Responsibility for insuring the Property: clear agreement on who will insure, against what risks and the scope of that insurance.
- Rent Abatement: Provisions outlining whether rent can be reduced or suspended if the property becomes unusable due to an insured risk.
- Use of Insurance Proceeds: How proceeds should be applied, particularly whether they should be directed toward rebuilding or repairs and how that affects lease obligations.
Ensuring that these elements are adequately addressed can prevent disputes similar to those experienced by Rogano, where uncertainty can lead to litigation and business disruption or closure.
The legal battle between Forthwell and Pontegadea rumbles on and only time will tell whether the doors of Rogano will remain closed as tightly as a clam or whether we’ll soon see Rod Stewart back dining in the swanky booths of Glasgow’s timeless seafood haven.
