711 Hogben Pty Ltd v Anthony Tadros [2022] NSWSC 1259

711 Hogben Pty Ltd v Anthony Tadros [2022] NSWSC 1259

The tenants proved on the balance of probabilities that, had Hogben performed its contractual obligation to construct the premises in accordance with the Plan, they would have obtained Service Approval and started trading in 2015, although from 18 November 2015 rather than July. Hogben's breach therefore caused the loss of a commercial opportunity to earn profits from operating the childcare centre. The opportunity was valued by reference to projected profits, but discounted by 50 per cent for risks and vicissitudes including achievable fees, occupancy, expenses, the high rent and operational uncertainties, and reduced by $350,000 needed for works, producing damages of $730,000.

Jurisdiction
Australia
Judgment Date
19 September 2022
Procedural Posture
Equity Commercial List; Landlord and Tenant Breach of Lease Damages Claim / Principal Judgment After Hearing of the Tenants' Claim for Damages; Quantum Only
Outcome
Verdict for the tenants, the second and third cross claimants, against Hogben, the third cross defendant, for $730,000.
Legal Topics
['breach of Agreement for Lease' 'specific Performance' 'loss of Commercial Opportunity' 'assessment of Lost Profits' 'service Approval for Childcare Centre' 'causation and Remoteness of Loss']
['contract Law' 'landlord and Tenant' 'damages' 'equity'] ['breach of Agreement for Lease' 'specific Performance' 'loss of Commercial Opportunity' 'assessment of Lost Profits' 'service Approval for Childcare Centre' 'causation and Remoteness of Loss']

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Procedural Posture

Equity Commercial List; Landlord and Tenant Breach of Lease Damages Claim / Principal Judgment After Hearing of the Tenants' Claim for Damages; Quantum Only

Legal Issues

  1. 1 ["Whether Hogben's breach of the agreement for lease caused the tenants to lose the opportunity to trade from the premises as a childcare centre." 'Whether the tenants would have obtained Service Approval and started trading in 2015 if Hogben had constructed the premises in accordance with the Plan.' 'Whether the tenants were likely to obtain Service Approval at the time of judgment.' 'How to assess the value of the lost commercial opportunity, including projected fees, occupancy rates, expenses, rent and vicissitudes.']

Ratio Decidendi

The tenants proved on the balance of probabilities that, had Hogben performed its contractual obligation to construct the premises in accordance with the Plan, they would have obtained Service Approval and started trading in 2015, although from 18 November 2015 rather than July. Hogben's breach therefore caused the loss of a commercial opportunity to earn profits from operating the childcare centre. The opportunity was valued by reference to projected profits, but discounted by 50 per cent for risks and vicissitudes including achievable fees, occupancy, expenses, the high rent and operational uncertainties, and reduced by $350,000 needed for works, producing damages of $730,000.

Court Disposition

Verdict for the tenants, the second and third cross claimants, against Hogben, the third cross defendant, for $730,000.

Orders

  • ['Verdict for the tenants (the second and third cross claimants) against Hogben (the third cross defendant) for $730,000.' 'The Court will hear the parties on costs if necessary.' 'If after ten days the parties have not reached agreement on costs, they are to exchange position papers setting out their positions on...