Castle Mall Fine Foods Pty Ltd v Queensland Investment Corporation [2003] NSWADT 207

Castle Mall Fine Foods Pty Ltd v Queensland Investment Corporation [2003] NSWADT 207

The lessor was not entitled to withhold consent because the shop had for years operated as a coffee shop with a broad food menu and takeaway sales, without prior objection, and the proposed assignee was not shown to be proposing a change to the use to which the shop was actually put. The request for consent was sufficiently made by the lessee's solicitor's letter of 11 March 2003, and the lessor did not deal with it promptly. By raising and attempting to impose restrictions on existing trading activities in the context of the proposed sale and assignment, the lessor breached s 39(1) of the Retail Leases Act 1994. The lessee was therefore entitled to damages representing the legal costs...

Jurisdiction
Australia
Judgment Date
03 September 2003
Procedural Posture
Retail Tenancy Claim Under the Retail Leases Act 1994 Concerning Consent to Assignment of a Retail Shop Lease, Damages, Costs and Unconscionability / Principal Matter Heard After Mediation Resolved the Assignment Issue But Preserved Claims for Costs, Compensation or Damages
Outcome
Application allowed; the respondent breached s 39(1) of the Retail Leases Act 1994 and was ordered to pay damages.
Legal Topics
['assignment of Retail Shop Lease' 'withholding Consent to Assignment' 'permitted Use of Leased Premises' 'retail Tenancy Damages' 'unconscionable Conduct' 'costs']
['retail Leases' 'property Law' 'administrative Tribunal Procedure'] ['assignment of Retail Shop Lease' 'withholding Consent to Assignment' 'permitted Use of Leased Premises' 'retail Tenancy Damages' 'unconscionable Conduct' 'costs']

Case Brief

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Procedural Posture

Retail Tenancy Claim Under the Retail Leases Act 1994 Concerning Consent to Assignment of a Retail Shop Lease, Damages, Costs and Unconscionability / Principal Matter Heard After Mediation Resolved the Assignment Issue But Preserved Claims for Costs, Compensation or Damages

Legal Issues

  1. 1 ['Whether the lessor was entitled under s 39(1) of the Retail Leases Act 1994 to withhold consent to assignment of the retail shop lease.' "When the lessor's time for dealing with the request for consent to assignment commenced under s 41 of the Retail Leases Act 1994." "Whether the lessor's conduct in seeking restrictions on the menu and takeaway sales breached s 39(1) of the Retail Leases Act 1994." "Whether the lessee should recover legal costs and expenses as damages for the lessor's breach." 'Whether it was necessary to decide the unconscionable conduct claim under s 62B of the Retail Leases Act 1994 or the alternative costs claim.']

Ratio Decidendi

The lessor was not entitled to withhold consent because the shop had for years operated as a coffee shop with a broad food menu and takeaway sales, without prior objection, and the proposed assignee was not shown to be proposing a change to the use to which the shop was actually put. The request for consent was sufficiently made by the lessee's solicitor's letter of 11 March 2003, and the lessor did not deal with it promptly. By raising and attempting to impose restrictions on existing trading activities in the context of the proposed sale and assignment, the lessor breached s 39(1) of the Retail Leases Act 1994. The lessee was therefore entitled to damages representing the legal costs...

Court Disposition

Application allowed; the respondent breached s 39(1) of the Retail Leases Act 1994 and was ordered to pay damages.

Orders

  • ['Respondent to pay the applicant damages of $10,119 plus further amount calculated in accordance with para [85] of these reasons.' "Liberty to either party to relist on 7 days' notice if they cannot reach agreement in relation to the further amount."]