A Lloyd Babb Pty Ltd v Bexgrove Pty Ltd - [2023] NSWSC 1167

Supreme Court

New South Wales

Medium Neutral Citation: A Lloyd Babb Pty Ltd v Bexgrove Pty Ltd [2023] NSWSC 1167
Hearing dates: 1 September 2023
Date of orders: 1 September 2023
Decision date: 27 September 2023
Jurisdiction: Equity - Real Property List
Before: Parker J
Decision:
See [57]

Catchwords:
CIVIL PROCEDURE – interlocutory applications – payment of money into court – lease dispute – tenant alleges abatement of rent – tenant applies for order that it pay rent into court pending the determination of the proceedings – utility – power to make order – rule that interlocutory relief can only be granted in aid of final relief – application refused
LEASES AND TENANCIES – rent and outgoings – abatement – tenant put out of possession by landlord – failure to complete landlord’s works allegedly breaches terms of lease – tenant does not go into occupation – alleged failure to give “exclusive possession” – construction of lease – whether tenant’s entitlement to possession deferred - whether abatement rule applies

Legislation Cited:
Uniform Civil Procedure Rules 2005, r 43.2(3)(c)

Cases Cited:
Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199
BHP Group Ltd v Impiombato (2021) 286 FCR 625
Drama Unit Pty Ltd v Fearndale Holdings Pty Ltd (2019) 101 NSWLR 573
In the matter of Elegant Swan Pty Ltd [2022] NSWSC 1451
JKB Holdings Pty Ltd v De la Vega [2013] NSWSC 501
Rofe Way Pty Ltd v Ronald [2023] NSWSC 1086

Texts Cited:
Nil

Category: Procedural rulings
Parties: A Lloyd Babb Pty Limited (Plaintiff)
Bexgrove Pty Limited (Defendant)
Representation:
Counsel:
B May (Plaintiff)
J Dooley/A Sivanathan (Defendant)
Solicitors:
WMD Law (Plaintiff)
Laliotis Lawyers (Defendant)

File Number(s): 2023/173577
Publication restriction: Nil

JUDGMENT

On 1 September, I made orders dismissing the plaintiff’s application for “interim relief” in these proceedings. This judgment sets out the reasons for my decision.
The proceedings arise from a dispute under a lease of commercial premises at Caringbah, in the southern suburbs of Sydney. The plaintiff, A Lloyd Babb Pty Limited (“ALB”), is the tenant. The defendant, Bexgrove Pty Limited (“Bexgrove”), is the landlord.

Background and procedural history

The lease between parties (which is unregistered) bore the date 9 November 2021 but specified the commencement date as having been 1 October of that year. The lease was for a period of five years, until 30 September 2026, with an option to renew for a further five years. There was also an option to purchase (clause 18), exercisable within the first three years, on specified terms.
The property owned by Bexgrove is a strata plan unit in a multi-storey mixed residential and commercial building (Bexgrove undertook the development and also remains the owner of six of the residential units). The unit in question is subject to a registered mortgage in favour of a bank lender. Its entrance is at street level.
The lease described the leased premises as part of the unit, namely the “first floor area”. This was an area which had been…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2023] NSWSC 1167
Decision Date: 27 September 2023

CaseChat Overview and Summary

The parties involved in this case are A Lloyd Babb Pty Ltd, the landlord, and Bexgrove Pty Ltd, the tenant. The dispute revolves around a lease agreement where the tenant alleges an abatement of rent due to the landlord's failure to complete certain works, which allegedly breached the terms of the lease. The tenant, having been put out of possession by the landlord, claims that they were not provided with "exclusive possession" as required by the lease. The matter was heard in the Supreme Court of Victoria. The tenant applied for an order that it pay the rent into court pending the determination of the proceedings, arguing that this would allow them to maintain the use of the premises while the dispute is resolved.

The legal issues that the court was required to decide included whether the tenant was entitled to possession under the lease and whether the tenant's entitlement to possession had been deferred. The court also had to determine whether the abatement rule applied, which would permit the tenant to reduce or withhold rent if the landlord failed to provide the tenant with exclusive possession. Additionally, the court needed to assess the utility of the proposed payment of rent into court and whether it would be an appropriate form of interlocutory relief.

The court found that the lease did not provide for the tenant's entitlement to possession to be deferred. The court also determined that the abatement rule did not apply as the tenant had not gone into occupation of the premises. The court emphasised the rule that interlocutory relief can only be granted in aid of final relief. The court held that the proposed payment of rent into court would not be an appropriate form of interlocutory relief in this case, as it would not aid in the final determination of the proceedings. Consequently, the application for the tenant to pay rent into court was refused.

The final orders of the court were that the application by Bexgrove Pty Ltd to pay rent into court was dismissed. The court did not grant the tenant's request, and the matter proceeded with the landlord and tenant continuing to dispute the terms of the lease and the entitlement to possession.

Orders