Menuko Pty Ltd v Tinine Group Pty Ltd [2007] NSWADT 149
The ratchet provision in clause 8 is void because s.18(4) of the Retail Leases Act 1994 applies to changes in rent at the commencement of a renewed lease, preventing any clause that limits rent reduction to market rent.
- Parties
- Applicant: Menuko Pty Ltd; Respondent: Tinine Group Pty Ltd
- Jurisdiction
- Australia
- Judgment Date
- 25 July 2007
- Procedural Posture
- Retail Lease Dispute / Principal Matter Decision
- Outcome
- declaration granted; ratchet clause void
- Legal Topics
- Retail Leases, Rent Review, Ratchet Clauses, Statutory Interpretation
Case Brief
Summary, issues, holding and outcome
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Parties
Menuko Pty Ltd
Applicant
Tinine Group Pty Ltd
Respondent
Procedural Posture
Retail Lease Dispute / Principal Matter Decision
Legal Issues
- 1 Whether the 'ratchet' provision in clause 8 of the lease is void under s.18(4) of the Retail Leases Act 1994
- 2 Proper construction of clause 8 of the lease regarding rent payable on renewal
- 3 Applicability of s.18 of the Retail Leases Act 1994 to ratchet provisions on lease renewal
Ratio Decidendi
The ratchet provision in clause 8 is void because s.18(4) of the Retail Leases Act 1994 applies to changes in rent at the commencement of a renewed lease, preventing any clause that limits rent reduction to market rent.
Court Disposition
declaration granted; ratchet clause void
Orders
- Declare that the final sentence of clause 8 of the lease is void by reason of s.18(4) of the Retail Leases Act
- Parties wishing to make an application for costs to file and serve written submissions within 28 days of this decision, failing which there will be no order as to costs
Full Case Text
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