Back in the dark ages, some local authorities had serious views on what retailers were allowed to sell. In Birmingham, for instance, magistrates would not countenance booze with news. They took the view that an open-early newsagent would be first port of call for the winos. Ridiculous, of course. Now the magistrates don't get to decide who and who does not get licences.

But local councils, when they are also landlords, can impose strange covenants on leases which restrict the sale of goods. Here is such a case in point.

Hitendra Patel, who runs a Costcutter in Harold Hill in Essex, trades in a parade of some 15 stores. His lease has a covenant prohibiting the sale of alcohol, tobacco, news and single chocolate bars. No doubt it was written when the parade was created to protect a nearby CTN and off licence.

Times change. Hitendra saw a handy local course, took it and got his personal licence. He thought this might get the council to change its mind over the covenant. Wrong. Another option, he thought, was to try to buy the Victoria Wine outlet a few doors down that First Quench's liquidators had put up for sale. At first they wanted to sell the whole chain in one go, but now the leaseholds on the branches are up individually.

It's a bit of a stitch-up, though. They require a non-refundable £5K deposit, six months rent up front, bids starting at £10K + VAT and all they are selling is four walls and a ceiling. It put it out of Hitendra's ball park.

I sent him to a chartered surveyor (they are good at negotiating leases) who suggested a letter pointing out the current economic conditions. I have further recommended that he approach his MP Angela Watkinson. She's a Tory so she's going to be very keen to help (on the Hertz/Avis car rental theory which goes: 'We're Avis. We're second, so we try harder.')

I hope to bring you good news on this one eventually.

Topics