Bavela Pty Ltd v Fusion Mastering Pty Ltd [2013] NSWADT 23

Bavela Pty Ltd v Fusion Mastering Pty Ltd [2013] NSWADT 23

Fusion Mastering Pty Ltd's application in file 125030 was dismissed because it was aware of the hearing, filed no evidence, decided not to participate and did not appear. In file 125067, Fusion Mastering Pty Ltd breached the lease by not paying rent, and the guarantors were liable under the guarantee and indemnity. However, the notice of breach did not comply with the lease requirement for service by security post and therefore did not make the postponed first four months' rent payable. Clause 17(g)'s 15% interest rate was unenforceable as a penalty because it was not a genuine pre-estimate of loss and grossly exceeded likely loss. Section 100 of the Civil Procedure Act 2005 did not apply...

Jurisdiction
Australia
Judgment Date
31 January 2013
Procedural Posture
Retail Lease Proceedings Concerning Breach for Non Payment of Rent and Related Claims / Principal Judgment After Consolidated Hearing
Outcome
Application 125030 dismissed; application 125067 allowed in part with orders for unpaid rent, interest and costs.
Legal Topics
['non Payment of Rent' 'lease Termination' 'service of Notice' 'guarantee and Indemnity' 'penalty Clauses' 'interest on Unpaid Rent' 'costs']
['retail Leases' 'contract Law' 'civil Procedure'] ['non Payment of Rent' 'lease Termination' 'service of Notice' 'guarantee and Indemnity' 'penalty Clauses' 'interest on Unpaid Rent' 'costs']

Case Brief

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Procedural Posture

Retail Lease Proceedings Concerning Breach for Non Payment of Rent and Related Claims / Principal Judgment After Consolidated Hearing

Legal Issues

  1. 1 ['Whether the application by Fusion Mastering Pty Ltd in file 125030 should be dismissed for non-appearance and failure to file evidence.' 'Whether Fusion Mastering Pty Ltd breached the lease by failing to pay rent and remained liable for unpaid rent to 8 October 2012.' "Whether the notice of breach was served in accordance with the lease so as to make the postponed first four months' rent payable." "Whether the guarantors were liable under the guarantee and indemnity for the lessee's obligations." 'Whether the contractual 15% interest clause was enforceable or amounted to a penalty.' 'Whether the Tribunal could award pre-decision interest and costs.']

Ratio Decidendi

Fusion Mastering Pty Ltd's application in file 125030 was dismissed because it was aware of the hearing, filed no evidence, decided not to participate and did not appear. In file 125067, Fusion Mastering Pty Ltd breached the lease by not paying rent, and the guarantors were liable under the guarantee and indemnity. However, the notice of breach did not comply with the lease requirement for service by security post and therefore did not make the postponed first four months' rent payable. Clause 17(g)'s 15% interest rate was unenforceable as a penalty because it was not a genuine pre-estimate of loss and grossly exceeded likely loss. Section 100 of the Civil Procedure Act 2005 did not apply...

Court Disposition

Application 125030 dismissed; application 125067 allowed in part with orders for unpaid rent, interest and costs.

Orders

  • ['In 125030: The application is dismissed.' 'In 125067: The Respondents must pay the applicant a sum of $297,067.77 for unpaid rent and interest to 31 January 2013.' "In 125067: The Respondents must pay to the Applicant a sum of $8,000.00 towards the applicant's costs in the proceedings."]