Young v Pioneer Concrete (Vic) Pty Ltd [1996] FCA 1178

Young v Pioneer Concrete (Vic) Pty Ltd [1996] FCA 1178

On the proper construction of special condition 3, the rent payable under the lease had to be reviewed for each successive 18-month period. The lessor did not have a discretion to avoid review by withholding notice; rather, the lessor was obliged to give a lessor's notice, although the notice could be given at any time. For ordinary review periods, if the lessee disputed the notice and agreement was not reached, rent was the greater of current open market rent determined by an independent valuer and the preceding 18-month rent plus 12.32%. For the review periods specified in paragraph 3(d), the final sentence of paragraph 3(c) did not apply and the rent was the current open market rent...

Jurisdiction
Australia
Judgment Date
26 March 1996
Procedural Posture
Proceeding for Declaratory Relief Concerning the Proper Construction of a Lease of Commercial Premises / Reasons for Judgment
Outcome
The Court stated the proper construction of the lease, substantially accepting the respondent's construction of the mandatory rent review and the operation of special condition 3(d).
Legal Topics
['construction of Lease' 'rent Review Clause' 'current Open Market Rent' "lessor's Notice" 'independent Valuer']
['contract Law' 'property Law' 'commercial Leasing'] ['construction of Lease' 'rent Review Clause' 'current Open Market Rent' "lessor's Notice" 'independent Valuer']

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Procedural Posture

Proceeding for Declaratory Relief Concerning the Proper Construction of a Lease of Commercial Premises / Reasons for Judgment

Legal Issues

  1. 1 ["Whether special condition 3 made each 18-month rent review mandatory or optional at the lessor's discretion." "Whether the lessor was obliged to give a lessor's notice to facilitate each rent review." 'How rent was to be determined for rent review dates specified in special condition 3(d).' 'Whether rent for the special condition 3(d) review periods had to be at least the rent payable for the preceding 18-month period.']

Ratio Decidendi

On the proper construction of special condition 3, the rent payable under the lease had to be reviewed for each successive 18-month period. The lessor did not have a discretion to avoid review by withholding notice; rather, the lessor was obliged to give a lessor's notice, although the notice could be given at any time. For ordinary review periods, if the lessee disputed the notice and agreement was not reached, rent was the greater of current open market rent determined by an independent valuer and the preceding 18-month rent plus 12.32%. For the review periods specified in paragraph 3(d), the final sentence of paragraph 3(c) did not apply and the rent was the current open market rent...

Court Disposition

The Court stated the proper construction of the lease, substantially accepting the respondent's construction of the mandatory rent review and the operation of special condition 3(d).

Orders

  • ['The rent payable under the lease must be reviewed in respect of each successive 18-month period of the term or any renewal.' 'The only method of reviewing rent is by observing the procedure in paragraphs (a) to (f) of special condition 3.' "The lessor is obliged to give a lessor's notice for each rent review date,...