Darzi Group Pty Ltd v Nolde Pty Ltd (No 2) [2022] NSWSC 643

Darzi Group Pty Ltd v Nolde Pty Ltd (No 2) [2022] NSWSC 643

Because Nolde Pty Ltd, as lessor, failed to renegotiate the rent in good faith with Darzi Group Pty Ltd, as required under clause 7 of the Retail and Other Commercial Leases (COVID-19) Regulation 2020 (NSW), it is permanently precluded from taking any prescribed action concerning the rent shortfall for May and June 2020. The plaintiff is entitled to a declaration to this effect, and to costs.

Parties
Plaintiff: Darzi Group Pty Ltd; Defendant: Nolde Pty Ltd
Jurisdiction
Australia
Judgment Date
23 May 2022
Procedural Posture
Consequential Orders Application (arising From Equity Retail Lease Dispute) / Post Judgment, Consequential Orders
Outcome
Declaration granted in favour of plaintiff; defendant precluded from prescribed action; costs ordered to plaintiff.
Legal Topics
Retail Leases, COVID 19 Regulation Compliance, Prescribed Action Under COVID 19 Regime, Good Faith Negotiation Obligations, Specific Performance
Equity Leases and Tenancies Retail Leases COVID 19 Regulation Compliance Prescribed Action Under COVID 19 Regime Good Faith Negotiation Obligations Specific Performance

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Parties

Darzi Group Pty Ltd

Plaintiff

Nolde Pty Ltd

Defendant

Procedural Posture

Consequential Orders Application (arising From Equity Retail Lease Dispute) / Post Judgment, Consequential Orders

Legal Issues

  1. 1 Whether the defendant lessor may take 'prescribed action' under Retail and Other Commercial Leases (COVID-19) Regulation 2020 (NSW) in respect of shortfall in rent for May and June 2020
  2. 2 Whether defendant was permanently precluded from taking 'prescribed action' due to failure to renegotiate rent in good faith as required by clause 7 of the Regulation
  3. 3 Whether any right to renegotiate or enforce the shortfall survived repeal of COVID-19 Regulation

Ratio Decidendi

Because Nolde Pty Ltd, as lessor, failed to renegotiate the rent in good faith with Darzi Group Pty Ltd, as required under clause 7 of the Retail and Other Commercial Leases (COVID-19) Regulation 2020 (NSW), it is permanently precluded from taking any prescribed action concerning the rent shortfall for May and June 2020. The plaintiff is entitled to a declaration to this effect, and to costs.

Court Disposition

Declaration granted in favour of plaintiff; defendant precluded from prescribed action; costs ordered to plaintiff.

Orders

  • Declares that the defendant is unable to take any 'prescribed action' as defined in the Retail and Other Commercial Leases (COVID-19 Regulation) 2020 against the plaintiff in respect of any shortfall in rent that the plaintiff was otherwise obliged to pay to the defendant for the months of May and June 2020.
  • Orders the defendant to pay the plaintiff's costs of this application.