73 Union Street Retail Pty Ltd v J and S Group Pty Ltd (No 2)
[2012] NSWADT 278
•14 November 2012
Administrative Decisions Tribunal
New South Wales
Medium Neutral Citation: 73 Union Street Retail Pty Ltd v J & S Group Pty Ltd & Ors (No 2) [2012] NSWADT 278 Hearing dates: 12, 13 and 14 November 2012 Decision date: 14 November 2012 Jurisdiction: Retail Leases Division Before: S Higgins, Deputy President Decision: 1. Applicant's retail leases claim is dismissed.
2. The applicant to pay the respondents' costs in the sum of $8,000 to be paid within twenty-eight days of the date of this decision.
Catchwords: Retail lease claim - loan and call option agreement - whether terms of the call option agreement amounted to a retail lease Legislation Cited: Administrative Decisions Tribunal Act 1997
Legal Profession Act 2004
Retail Leases Act 1994Cases Cited: 73 Union St Retail Pty Ltd v J & S Group Pty Ltd [2012] NSWADT 212 Category: Principal judgment Parties: 73 Union Street Retail Pty Ltd (Applicant)
J & S Group (First Respondent)
Union City Convenience Pty Ltd (Second Respondent)
Jamal Gebara (Third Respondent)Representation: Counsel
M Bennett (Respondent)
A Soltan (Agent of the Applicant)
Breen and Breen Solicitors (Respondents)
File Number(s): 125117
REASONS FOR DECISION
Background
On 14 November 2012, following a 2 ½ day hearing, I gave an oral decision and dismissed the applicant's retail leases claim. I also made an order that the applicant pay the respondents' costs in the sum of $8,000 to be paid within twenty-eight days of the date of this decision. In giving my oral decision I also gave reasons for decision. An application has been made under subsection 89(3) of the Administrative Decisions Tribunal Act 1997 for written reasons. These are my written reasons, which are in accordance with those given orally.
Introduction
This is an application by 73 Union Street Retail Pty Limited (73 Union Street) seeking declarations and orders under s 72 of the Retail Leases Act 1994 (RL Act) in respect to premises owned by the first respondent, J & S Group Pty Limited (J & S Group), at 73 Union Street Pyrmont being Lot 13 in Strata Plan 63800 (the premises). There is no dispute that the premises have at all relevant times been used as a retail shop, namely, a convenience store.
Section 72 of the RL Act sets out the powers of the Tribunal in regard to a 'retail tenancy claim'. Section 70 defines a 'retail tenancy claim' and s 71 sets out who can bring a claim. It is only a 'party' or 'former party' to a 'retail shop lease' or 'former retail shop lease' who can bring a 'retail tenancy claim' within the jurisdiction of the Tribunal. And a 'party' to a lease is either the lessee or the lessor.
It is the contention of 73 Union Street that pursuant to a call option agreement (the call option) between it and J & S Group Pty Limited it entered occupation of the premises on 10 November 2011 to operate a convenience store under the 'City Convenience Store' banner. That occupation it asserts was subject to the RL Act. That is, its occupation of the premises amounted to a 'retail shop lease' as defined in s 3 of the RL Act and that the commencement of that lease was on 10 November 2011, in accordance with s 8 of the RL Act.
J & S Group dispute that the terms of the call option gave 73 Union Street a right to occupy the premises as lessee, or that 73 Union Street occupied the premises as a lessee pursuant to an agreement otherwise. It asserts that at the request of Mr Haney Soltan, the sole director of 73 Union Street, Mr Gebara, the third respondent and controller of J & S Group and other entities within the City Convenience group of companies, had appointed Mr Soltan to act as manager of the City Convenience business operating from the premises.
There is no dispute that Mr Soltan opened a City Convenience business at the premises on 10 November 2011 and that he operated the business until 3 August 2012. On this day, Mohamed Gebara, the son of the third respondent refused to allow Mr Soltan to enter the premises. Mr Soltan has not operated the business since that day.
Critical to the claim of 73 Union Street is that (a) the call option gave it a right to occupy the premises, that is, the occupation amounted to a 'retail shop lease' as defined in the RL Act, or (b) the circumstances in which Mr Soltan entered the premises amounted to a 'retail shop lease' as defined in the RL Act.
Before dealing with the terms of the call option it is convenient to set out some of the relevant facts surrounding the call option agreement and what happened subsequently thereto.
The J & S Group purchased the premises in 2001. At the time of purchase the premises were subject to a retail shop lease under the RL Act. The lease was to 7 Eleven, who used the premises as a convenience store. That lease commenced on 12 November 2001. It was a lease for five years, with an option to renew for a further period of five years. That option was exercised and the 7 Eleven lease was due to end on 10 November 2011.
J & S Group is affiliated with the City Convenience group of companies, which operate, cooperate, or supply a number of convenience stores throughout Australia. These stores all operate under the banner of 'City Convenience Store'. The founder and chairman of the parent company of the group of companies, City Convenience Store Pty Ltd, as I have indicated, is Mr Jamal Gebara.
Mr Soltan has also run a number of convenience store businesses since 2001. It is the evidence of Mr Soltan that in the months before December 2010, he was looking for a suitable site to establish a convenience store business for him. He became aware of the premises owned by J & S Group and that the then lease of the premises to 7 Eleven was due to expire in November 2011.
There is no dispute that Mr Soltan met with Mr Gebara in early November 2010 and as a result of their meeting Mr Soltan instructed his lawyer to prepare a loan agreement and call option agreement between J & S Group and his company, 73 Union Street. That agreement was executed on 6 December 2010. In accordance with the loan agreement, 73 Union Street loaned $150,000 to the J & S Group. Under the terms of the loan agreement J & S Group was to repay the loan together with interest by 31 January 2011. The agreement also provided that a failure to repay the loan by that date caused the loan to convert to a call option. There is no dispute that the loan was not repaid within the time stipulated in the agreement and that the call option came into effect.
There is also no dispute that, in accordance with cl 2.1 of the call option agreement, 7 Eleven vacated the premises by 10 November 2011. Nor is it disputed that from this day the premises were used to operate a business under the 'City Convenience Store' banner and it continues to do so as of today. The current owner of the business is the second respondent, Union City Convenience Pty Limited (the City Convenience business), a company within the City Convenience group of companies. Mr Soltan, nor 73 Union Street are directors or shareholders of this entity.
73 Union Street asserts that by reason of cll 12.3 and 13.3 of the call option agreement it was vested with an interest in the City Convenience business that has been operating from the premises since November 2011 and therefore was given a right to occupy the premises and that occupation amounted to a lease. In my view these clauses cannot be construed in the manner suggested by Mr Soltan on behalf of 73 Union Street.
Retail Leases Act
Before I deal with the relevant clauses of the call option agreement I will briefly deal with the meaning of a retail shop lease under the RL Act.
Section 3 defines a 'retail shop lease or lease' to mean:
An agreement under which a person grants or agrees to grant another person for value a right of occupation of premises for the purpose of the use of the premises as a retail shop:
(a) whether or not the right is a right of exclusive occupation, and
(b) whether the agreement is express or implied, and
(c) whether the agreement is oral or in writing or partly oral and partly in writing.
As pointed out by Mr Soltan, this definition is based on an agreement to grant a right of occupation of premises, which need not be an 'exclusive' occupation. That right of course is subject to it being a right for value and also for the purpose for use as a retail shop.
As I have indicated, section 8 of the RL Act sets out when a retail shop lease is entered into for the purpose of the Act. In summary, that provision provides that a lease is entered when (a) a person enters possession of a retail shop as lessee under the lease or pays rent or (b) at the time the parties execute a lease.
There is no dispute about the established legal principles in the application of these provisions. Mr Soltan has cited many of these. However, for the purpose of this application, it is the proper construction of the terms of the call option agreement, or the facts and their respective application to these principles, which are in dispute; namely whether the agreement or the facts give rise to a retail shop lease between 73 Union Street and J & S Group. If not, then 73 Union Street has no standing under s 71 (1) of the RL Act to bring these proceedings in the Tribunal, as it will not have been a party to a retail shop lease.
Call Option Agreement
As I understand the submission of Mr Soltan, it is conceded that on the City Convenience business commencing operation from the premises in November 2011 it occupied the premises as lessee. However, that occupation was not exclusive of the alleged occupation by 73 Union Street as lessee. In this regard, Mr Soltan contended that the call option agreement gave 73 Union Street an interest in the ownership of the City Convenience business and therefore it also was a lessee.
In my view, on its proper construction the call option did not give 73 Union Street an interest in the ownership of the business until such time as it exercised its option under the agreement. The grant of the call option is set out in cl 2.1 of the agreement. It provides as follows:
'Call option. In consideration of the conversion of the advance (the Call Option Fee) (receipt of which is acknowledge for the sum of $150,000) the Grantor hereby grants to the Grantee an option on the terms set out in this Agreement for the grantee to purchase the Relevant Interest in fee simple in the Land for the purchase price and on the terms set out in this document. Such Call Option will take effect as an irrevocable offer by the Grantor to sell the Land which will lapse on the expiry of the Call Option Period.'
The 'Grantee' is defined as 73 Union Street and the 'Grantor' is defined as the S & P Group.
The 'relevant interest' is defined in Part 1 of Attachment 1 to the agreement to mean 'thirty percent (30%) of all interest in the land being the premises but free of any mortgage or'.
The 'purchase price' is also defined in Part 1 of Attachment 1 to mean:
'30% of the agreed value of the land at the time the advance is provided and such value for the land being $3,000,000 (exclusive of GST), that is $900,000 (exclusive of GST) subject to any ordinary conveyancing adjustments.'
The 'call option period' is defined in Part 1 of Attachment 1 to mean 'the period commencing 1 December 2011 and ending 13 November 2012'.
There is no dispute that 73 Union Street has not exercised its option under the call option agreement. The means by which the call option can be exercised is set out in cl 2.3 of the agreement. In the event 73 Union Street did not exercise the call option within the call option period, cl 5.1 provides that it will be refunded the call option fee, less an amount of $5,000. That is, 73 Union Street would be refunded $145,000.00.
Clause 12 of the agreement set out the 'business ownership interests' between S & P Group and 73 Union Street. As I have already explained, cl 12.1 deals with S & P Group's obligation in regard to the then tenant, 7 Eleven, vacating the premises by no later than 12 November 2011.
Clause 12.2 provides an acknowledgment by the parties (i.e. S & P Group and 73 Union Street) that the 'purchase price of the call option represented 30% of the combined value of the Land (i.e. the premises) and the business that shall be established on the Land ("the Business").' The Business' is defined in Part 1 of Attachment 1 to mean:
the Business of a convenience store to be established by the Grantor on the Land following the vacation of the Land by the tenants: 7- eleven. (my emphasis)
Clause 12.3 provides:
The Business shall be established by the Grantor (or a related party) and the Grantee each contributing to the costs in accordance with the following proportions:
(a) the Grantor (or related entity) at 70% and
(b) the Grantee at 30%.
Clause 12.4 provides that, upon settlement of the 'Contract', 73 Union Street will be entitled to be registered as 30% co-owner of the premises and the business. The word 'Contract' is defined to mean:
The combined Contract for Sale of land and Contract for the Sale of Business at the Land for the Land, to be prepared by the Grantor, in accordance with standard NSW conveyancing practice and as follows:
Settlement of 2 years;
For the purchase price (exclusive of GST); and
Deposit being the Call Option Fee
As I have already explained, cl 2.3 sets out the manner in which 73 Union Street is to exercise the call option if it chooses to do so. If it does so choose, cl 2.3(b) requires 73 Union Street to deliver, to the J & S Group, an executed 'Contract' for the sale of land. That 'Contract' I note could be prepared by 73 Union Street. There is no evidence of such a 'Contract' having been prepared or executed. Nor is there any dispute that there has been no settlement of the 'Contract' or that the option has been exercised by 73 Union Street.
Clause 12.5 acknowledges that, in the event 73 Union Street purchases the 'relevant interest' (i.e. the 30% interest in the premises as provided in cl 2.1) it will be entitled to 30% of the rental proceeds and 30% of the revenue of the business.
In my view, on its proper construction cl 12 does no more than vest 73 Union Street with a 30% interest in the land (i.e. the premises) and the business, which is to be established by J & S Group on the land. However, that interest is subject to 73 Union Street exercising the call option as set out in cll 2.1 and 2.3 of the agreement. I again emphasise 73 Union Street has not exercised the call option to date. It is at liberty to do so until the end of this month. Even if it does exercise the call option, the interest 73 Union Street will acquire under the call option agreement is an interest in the land (i.e. the premises) and the business that is operating from the premises. That is, it will acquire an interest in the J & S Group, which is the owner/lessor of the premises and interest in the Business that is the lessee of the premises. It does not however, give rise to 73 Union Street being a lessee of the premises.
Clause 13 of the call option agreement sets out what is described as 'transitional arrangements'. Clause 13.3 provides that promptly, following vacation of the premises by 7 Eleven, J & S Group will lease the premises to a 'related entity' on the following terms:
a.Rental being $208,000 exclusive of GST;
b.no outgoings; and
c.a term of five years with an option for a further two terms of five years each (a total of 15 years).
Clauses 13.1 and 13.2 provide that, following the vacation of the premises by 7 Eleven, J & S Group will invite 73 Union Street to contribute 30% to the cost of establishing and running the business and in the event 73 Union Street provides this amount it shall be entitled to 30% of the income of the business.
In my view, on its proper construction the effect of cl 13 is to give 73 Union Street an immediate right to 30% of the income of the business, established by J & S Group to operate from the premises, pending its exercise of the call option. However, the right vested under cl 13 is also subject to 73 Union Street contributing 30% of the establishment and running costs of the business. However, the clause cannot be construed as giving 73 Union Street a right of occupation of the premises in the event it pays the required contribution.
Evidence and findings
Mr Soltan contended that by being granted access to the premises it should be inferred that his company, or he, were granted a right to occupation of the premises in the relevant sense. The evidence is that Mr Soltan was given 30% of the profits of the business during the time he was operating the business. Nevertheless, in my opinion, it is not possible to infer from the conduct of the parties as a whole, as evidenced in these proceedings, that 73 Union Street occupied the premises as lessee.
In this regard Mr Soltan has produced no evidence that 73 Union Street paid rent to J & S Group or that it had executed a lease with J & S Group. Indeed, his evidence is contrary to this. His evidence is that at the time he entered into the loan and call option agreement he was happy to loan J & S Group $150,000 on the basis of being given an option to purchase a 30% interest in the premises and the business that was to be operated from it once it was vacated by 7 Eleven. In his evidence he said that he told Mr Gebara that he needed to 'trial' the business for one year once 7 Eleven vacated it. After a year, he said he would be in a position to decide whether to purchase the 30% interest in the land and the business operating from it. That is, at all times his intention was to trial/test the business for a year to see whether it was, or was not profitable and whether it was worth his while to make the investment in the terms discussed with Mr Gebara in November 2010.
As I have indicated, the terms of the call option agreement are also reflective of his stated intentions.
Leaving the terms of the agreement aside, there is no evidence that on 10 November 2011 when Mr Soltan took the keys to the premises that 73 Union Street was operating a business, let alone a business from the premises. The evidence of Mr Jamal Gebara was that the 30% share of the profits was in lieu of a management fee.
The onus is on 73 Union Street to establish that it was a lessee in the relevant sense. In this regard, I note that there is no evidence to show that 73 Union Street was registered for the purposes of GST, or that it opened a trading account in regard to the business that was being operated from the premises. What is in evidence is that Mr Soltan described himself and his company (73 Union Street) as 'manager' of the business. I accept he may have made payments for some stock and other matters in regard to the opening of the business. However, there is no evidence that 73 Union Street provided these funds. The evidence is that, in the main, stock was bought by and accounted for through a City Convenience company and the second respondent, the Union City Convenience Pty Ltd.
In my view, the schedules of weekly sales and expenses Mr Soltan alleges were provided to the City Convenience business do not demonstrate that his company, 73 Union Street, was operating a business from the premises. They are, however, consistent with Mr Soltan or his company being the manager of the business.
On 13 January 2012, Mr Soltan's solicitor sent an email to Mr Jamal Gebara stating that in a meeting with Mr Soltan he had identified that there was no lease between 'the landlord and the tenant' for the premises and that it would be prudent to establish one. The solicitor also asked to be informed as to whether a lease had been entered. It would appear that no response was provided. However, Mr Jamal Gebara gave evidence of a written lease having been entered between himself and J & S Group. That lease is stated to have commenced on 12 November 2011 and its terms were in accordance with cl13.3 of the call option agreement. Mr Soltan questioned the authenticity of this lease. It is his evidence that it was not until 30 August 2012, during the course of the hearing of the interim order application that the existence of this lease was raised. At the same time I note, that on 10 November 2011, the solicitor for J & S Group was requested, by email, from Mohamed, the Administration Manager of the City Convenience Stores, to prepare a lease for the premises with Mr Jamal Gebara being named as the lessee.
In his affidavit, sworn 8 November 2012, Mr Soltan said that in March 2012 he became aware that the premises were being offered for sale and as a consequence he contacted the selling agent and requested a copy of the contract of sale and the lease. On 2 April 2012, the selling agent forwarded him a copy of the contract and the lease. In this regard I note that the contract for the sale of the land included a copy of the caveat lodged by 73 Union Street as a result of the December 2010 loan agreement between it and J & S Group. The lease, unexecuted, was a lease between J & S Group and City Convenience Investments Pty Ltd, which I assume to be a company within the City Convenience group of companies. The commencement date of the lease was 9 March 2012.
It would appear that a lease was subsequently entered as of 22 March 2012, however the lessee was the second respondent and not the lessee named in the lease provided by the selling agent. However, as a result of 73 Union Street's caveat on the property, this subsequent lease could not be registered, without that caveat being removed. I understand that what followed was a series of negotiations between April and July 2012 so that the caveat could be withdrawn. On 22 June 2012, the solicitor for the City Convenience group of companies, Mr Tim Breen, forwarded to Mr Soltan, for his consideration, a lease, a shareholder agreement and a deed of release. The lease named J & S Group is named as lessor and the second respondent as lessee and the commencement date of the lease was 22 March 2012.
The Shareholder Agreement is an agreement between the second respondent, Union City Convenience Pty Ltd, Osama Gebara and City Importers Pty Ltd. The agreement provides for Osama Gebara to be given a 70% shareholding in the second respondent and City Importers Pty Ltd to be given a 30% shareholding. I understand City Imports Pty Ltd is a company owned by Mr Soltan. I note that the business of the second respondent in this Agreement is stated to be 'the operation of a real estate agency including property management services.'
In response to the lease document, Mr Soltan requested an amendment to the lessee company. Mr Soltan requested that the details of the lessee be changed to City Imports Pty Ltd as to 30% and 70% to another related City Convenience Store company that has been around for many years. He also requested some further amendments to the lease. Mr Breen responded by agreeing to some of the requested amendments to the lease. However, he did not agree to the requested amendments to the name of the lessee. In his further reply of 29 June 2012, Mr Soltan said 'In my opinion a lease showing "City Convenience Store Pty Ltd" which was formed in 1996 as a lessee with 70% interest is far more attractive to a potential buyer.' He also went on to request some further amendments to the Shareholder Agreement, including the timing of its execution.
Neither agreement nor the Deed of Release has been executed. Nor has the caveat has not been removed and the parties remain in dispute.
However, as pointed out by Mr Bennett, counsel for the respondent, during the course of these negotiations and thereafter, Mr Soltan at no time suggested that there was existing lease between 73 Union Street and J & S Group. Such a claim was not made until he filed these proceedings in the Tribunal on 24 August 2012. While this need not be detrimental to such a claim subsequently made, it nevertheless is an indication as to the nature of the agreement between the parties as understood by Mr Soltan on behalf of 73 Union Street. As I have indicated, Mr Soltan's conduct and that of those controlling the J & S Group, once the call option agreement came into effect is inconsistent with 73 Union Street being a lessee of the premises. At all times, the conduct of the parties appears to have been consistent with 73 Union Street receiving a 30% interest in the ownership of the premises and becoming a shareholder of the business that was being conducted from the premises.
In summary, on the basis of my findings in regard to the proper construction of the call option agreement and also on the evidence relating to the circumstances giving rise to Mr Soltan's opening of the business from the premises, 73 Union Street has failed to establish that it entered occupation of the premises as a party to a retail shop lease for the premises. On this basis the Tribunal does not have jurisdiction to hear and determine this application and the appropriate order is for the application to be dismissed.
In making my findings this does not mean that 73 Union Street has no right of action against J & S Group, or the lessee of the premises, in regard to the loan and call option agreement. However, any rights it may have under this agreement or more generally do not fall within the jurisdiction of the Tribunal.
Costs
On the basis of my findings, the respondents have made an application for costs.
The Tribunal's power to award costs is set out in s 88 of the Administrative Tribunal Act 1997 (ADT Act) and s 77A of the RL Act. Subsection 88 (1) of the ADT Act provides that each party to proceedings before the Tribunal are to bear their own costs except as provided in that section. That is, the starting point is that each party bears its own costs.
Subsection 88 (1A) gives the Tribunal a discretion to award costs, but only where it is satisfied that it is fair to do so having regard to the matters set out in that paragraph. Subsection 88 (2) provides that the Tribunal may determine by whom and to what extent costs are to be paid and order that the costs be assessed on the basis set out in Division 11 of Part 3.2 of the Legal Profession Act 2004 or on any other basis.
The respondents contend that a costs order is warranted in this application as the applicant's application lacked merit and was maliciously brought. It also contended that Mr Soltan, who acted as agent for 73 Union Street should be ordered to pay those costs.
In regard to the issue of lack of merit, Mr Soltan said the application did have merit and he relied on the decision of Judicial Member Montgomery in its interim order application: see 73 Union St Retail Pty Ltd v J & S Group Pty Ltd [2012] NSWADT 212 at [49]. In my view, while Judicial Member Montgomery found that 73 Union Street had an arguable case, that finding was made on the untested material before him and also on the basis of taking the applicant's case at its highest.
The material that is now before the Tribunal certainly exceeds that which was before Judicial Member Montgomery. Nevertheless, I note that at no time have the respondents written to, or informed Mr Soltan that the application of 73 Union Street lacked merit and why it lacked merit. However, this might be inferred from the reply that was filed by the first and second respondent to 73 Union Street's amended application. This reply was filed on 2 November 2012 and asserted that many of the orders or declarations sought in the amended application were not within the jurisdiction of the Tribunal. I agree with the respondents in this regard.
However, the respondent's reply did say that Mr Soltan's presence in the premises was in his capacity as manager of the business that was being operated from those premises and no lease existed between the J & S Group and 73 Union Street. Accordingly, by 2 November 2012, Mr Soltan was clearly on notice as to how the respondents' viewed the claim of his company. The fact that 73 Union Street was not successful in its claim and that the respondents' assertions have been accepted, will not on their own give rise to the exercise of the Tribunal's discretion to make an award of costs.
In my view, of concern is Mr Soltan's ongoing assertion of having expertise in this area of the law and the operation of the RL Act. This asserted expertise should have placed him on notice of the position of the respondents and what 73 Union Street needed to establish in order to succeed in its claim. He also has considerable commercial experience in operating a convenience store.
Paragraph 88 (1A) (c) of the ADT Act provides that one of the considerations to be taken into account by the Tribunal in deciding whether to award costs is the relevant strength of the claims made by the parties, including whether a party has made a claim that has no tenable basis in fact or law. Another factor set out in para (88(1A)(d) is the nature and complexity of the proceedings.
In my view these proceedings were not in fact very complex but were made complex by the manner in which Mr Soltan prosecuted the claim of his company.
The respondents also contend that Mr Soltan conducted the proceedings maliciously. In my view, there is no material before the Tribunal to indicate that he has done so. At most he has conducted them without the requisite level of objectivity. As a consequence, he failed to assess the relative strengths and weaknesses of his company's retail leases claim having regard to the respondents' reply and the evidence that was filed on their behalf. Had he done so he would have identified the weakness of the retail leases claim of his company and the arguable strengths of the claim of the respondents.
At the time the respondents' reply was filed so too was their evidence. As the onus was on 73 Union Street to establish its case, in my view I am satisfied that it is fair to make an award for costs in relation to the proceedings, which are commercial in nature. However, that award should not apply to the proceedings occurring on or prior to 2 November 2012.
The hearing of this matter was set down some time ago. Three days were set down for the hearing. In my view this hearing has been unnecessarily extended due to the manner in which Mr Soltan has run these proceedings. Mr Soltan is not legally trained, but has some knowledge in that he is aware of many of the relevant legal authorities. It is Mr Soltan's application of those authorities to the facts in issue, which are of some concern. Nevertheless, on this occasion in my view it is not appropriate to make an order for costs against Mr Soltan personally.
I note Mr Soltan's insistence on taking a very artificial approach as to the capacity in which he appears before the Tribunal. He has sought to act as the mind of 73 Union Street (i.e. in his capacity as the sole director) and also act as the agent of the company under section 71C of the RL Act. He acknowledged that he did so for the purposes of seeking a cost order in the event 73 Union Street was successful in its claim. While I have not made any formal ruling in regard to Mr Soltan acting both as the mind of his company and at the same time being its agent, I have questioned the appropriateness of this and pointed out that his tactic may expose him to the risk of a possible order for costs.
In regard to costs, Mr Bennett has informed me the respondents' costs for these three days of hearing is an amount of $12,000. Those costs would of course, if assessed, not necessarily be the costs that would be recoverable. I do not have any itemised list of costs but on the basis of what Mr Bennett, counsel for the respondent has advised, I am prepared to make an estimate in order to finalise these proceedings and not delay them any further.
Accordingly, I make an order that the applicant (73 Union Street) pay the respondents' costs in the sum of $8,000 to be paid within twenty-eight days of this decision.
**********
Decision last updated: 10 January 2013
1
1
3