ABEDY and ARISE JOONDALUP PTY LTD (ACN 150 980 760)
[2015] WASAT 140
•14 DECEMBER 2015
ABEDY and ARISE JOONDALUP PTY LTD (ACN 150 980 760) [2015] WASAT 140
| STATE ADMINISTRATIVE TRIBUNAL | Citation No: | [2015] WASAT 140 | |
| COMMERCIAL TENANCY (RETAIL SHOPS) AGREEMENTS ACT 1985 (WA) | |||
| Case No: | CC:409/2015 | 11 AUGUST 2015 | |
| Coram: | JUSTICE J C CURTHOYS (PRESIDENT) | 14/12/15 | |
| 21 | Judgment Part: | 1 of 1 | |
| Result: | Matters transferred to District Court of Perth, Western Australia | ||
| B | |||
| PDF Version |
| Parties: | HUSENALY SAEY ABEDY AUSIE & AZAR PTY LTD (ACN 158 507 816) ARISE JOONDALUP PTY LTD (ACN 150 980 760) |
Catchwords: | District Court proceedings relating to Deed filed by landlord Defence and counterclaim filed by lessee and guarantor Misleading the Court Unconscionable conduct Tribunal applications filed by landlord and by lessee and guarantor relating to Lease Application under s 27 of Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA) Whether Tribunal ceases to have jurisdiction to hear or determine applications In the interests of justice Transfer to District Court of Perth Western Australia |
Legislation: | Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA), s 6, s 15C(1), s 15F(1), s 16(1), s 16(2), s 16(C), s 16D(3), s 26, s 27, s 27(4), s 27(6), s 27(3) |
Case References: | Nil |
Orders | 1. Matters CC 409 of 2015 and CC 778, 779 and 780 of 2015 to be transferred to the District Court of Perth, Western Australia, pursuant to s 27 of the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA). |
Summary | These reasons concern applications in the Tribunal involving each of Arise Joondalup Pty Ltd, Ausie & Azar Pty Ltd and Mr Husenaly Saey Abedy, the guarantor of Ausie & Azar's obligations under various agreements with Arise Joondalup.,There were five proceedings involving those parties before the Tribunal and one in the District Court.,This decision arose because of the need to avoid the risk of conflicting decisions between this Tribunal and the District Court.,By application CC 1238 of 2015, Mr Abedy and Ausie & Azar sought an order pursuant to s 27 of the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA) that the Tribunal ceases to have jurisdiction to hear or determine the applications in CC 409, 778, 779 and 780 of 2015.,The Tribunal determined that it would be undesirable that identical parties be engaged in two sets of proceedings in two jurisdictions. In addition to the costs issues, there is an obvious risk of conflicting findings of fact.,The Tribunal concluded that it was in the best interests of justice that CC 409 of 2015 and CC 778, 779 and 780 of 2015 be transferred to the District Court of Perth, Western Australia, pursuant to s 27 of the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA) |
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL ACT : COMMERCIAL TENANCY (RETAIL SHOPS) AGREEMENTS ACT 1985 (WA) CITATION : ABEDY and ARISE JOONDALUP PTY LTD (ACN 150 980 760) [2015] WASAT 140 MEMBER : JUSTICE J C CURTHOYS (PRESIDENT) HEARD : 11 AUGUST 2015 DELIVERED : 14 DECEMBER 2015 FILE NO/S : CC 409 of 2015
- CC 778 of 2015
CC 779 of 2015
CC 780 of 2015
CC 1238 of 2015
- AUSIE & AZAR PTY LTD (ACN 158 507 816)
Applicants
AND
ARISE JOONDALUP PTY LTD (ACN 150 980 760)
Respondent
Catchwords:
District Court proceedings relating to Deed filed by landlord - Defence and counterclaim filed by lessee and guarantor - Misleading the Court - Unconscionable conduct - Tribunal applications filed by landlord and by lessee and guarantor relating to Lease - Application under s 27 of Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA) - Whether Tribunal ceases to have jurisdiction to hear or determine applications - In the interests of justice - Transfer to District Court of Perth Western Australia
Legislation:
Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA), s 6, s 15C(1), s 15F(1), s 16(1), s 16(2), s 16(C), s 16D(3), s 26, s 27, s 27(4), s 27(6), s 27(3)
Result:
Matters transferred to District Court of Perth, Western Australia
Summary of Tribunal's decision:
These reasons concern applications in the Tribunal involving each of Arise Joondalup Pty Ltd, Ausie & Azar Pty Ltd and Mr Husenaly Saey Abedy, the guarantor of Ausie & Azar's obligations under various agreements with Arise Joondalup.
There were five proceedings involving those parties before the Tribunal and one in the District Court.
This decision arose because of the need to avoid the risk of conflicting decisions between this Tribunal and the District Court.
By application CC 1238 of 2015, Mr Abedy and Ausie & Azar sought an order pursuant to s 27 of the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA) that the Tribunal ceases to have jurisdiction to hear or determine the applications in CC 409, 778, 779 and 780 of 2015.
The Tribunal determined that it would be undesirable that identical parties be engaged in two sets of proceedings in two jurisdictions. In addition to the costs issues, there is an obvious risk of conflicting findings of fact.
The Tribunal concluded that it was in the best interests of justice that CC 409 of 2015 and CC 778, 779 and 780 of 2015 be transferred to the District Court of Perth, Western Australia, pursuant to s 27 of the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA)
Category: B
Representation:
Counsel:
Applicants : Mr TB Lyons
Respondent : Mr I Freeman
Solicitors:
Applicants : Gibson Lyons
Respondent : Lavan Legal
Case(s) referred to in decision(s):
Nil
Introduction
1 Arise Joondalup Pty Ltd (Arise) is the registered proprietor and the landlord of the tenancies (including unit 15) within the commercial centre known as Joondalup Square, located at 3 Sundew Rise, Joondalup (the Premises).
2 Ausie & Azar Pty Ltd (Ausie & Azar) carried on business trading firstly as a franchisor of 'Croissant Express' and later as 'Roll Call'.
3 Husenaly Saey Abedy (Mr Abedy) is the guarantor of Ausie & Azar's obligations under various agreements with Arise.
4 These reasons concern applications in the Tribunal involving each of Arise, Ausie & Azar and Mr Abedy. This decision arises because of the need to avoid the risk of conflicting decisions between this Tribunal and the District Court.
5 There are now five proceedings involving those parties before the Tribunal and one in the District Court.
6 By application CC 1238 of 2015, Mr Abedy and Ausie & Azar seek an order pursuant to s 27(6) of the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA) (the Act) that the Tribunal ceases to have jurisdiction to hear or determine the applications in CC 409, 778, 779 and 780 of 2015.
The lease documents
7 In setting out the facts relating to the lease documents, the Tribunal has essentially adopted Arise's account of the facts. The Tribunal acknowledges that those facts are in part disputed by Ausie & Azar and Mr Abedy. The Tribunal has not made a determination of the facts. The Tribunal has adapted Arise's outline of the facts simply to give these reasons context.
8 On or around 15 November 2012, Arise provided Ausie & Azar and Mr Abedy with an agreement for lease of the Premises (the Agreement) and a disclosure statement required under s 6 of the Act.
9 Ausie & Azar as lessee and Mr Abedy as guarantor signed the Agreement on or around 22 November 2012 (Arise Bundle of Documents Tab 3).
10 In or around mid-2013, the parties entered into the Lease contemplated by clause 2.1 and Schedule 5 of the Agreement. The Lease contained identical material terms to the Agreement, save for confirming that the commencement date was 26 November 2013 (Arise Bundle of Documents Tab 5).
11 At the time the Agreement and the Lease were entered into, Arise was carrying out building works (the Landlord's Works) at Joondalup Square. In or around 15 October 2013, Arise completed the Landlord's Works as described under the Lease and handed over the Premises to Ausie & Azar.
12 The term of the Lease commenced on 26 November 2013.
13 On or around 18 July 2014, the parties executed a variation of lease (Arise Bundle of Documents Tab 7).
14 In July or August 2014, the parties executed a deed entitled 'Acknowledgement of Debt' (the Deed). There is a discrepancy about the date of the Deed (see paragraph 4(a) Defence and Counterclaim CIV 559 of 2014). Ausie & Azar give the date as 18 July 2014. Arise plead a date of August 2014 in the District Court writ. It is unnecessary to resolve the date for the purpose of this decision.
15 By clause 7 of the Deed, a breach of the Deed was deemed a default under the Lease.
16 Arise alleges that:
a) Ausie & Azar ceased making rent and outgoings payments to it from in or around November 2014;
b) Arise's managing agent for the Premises, CBRE, issued Ausie & Azar and Mr Abedy with arrears notices on 6, 13 and 27 January 2015;
c) Despite those notices, Ausie & Azar and Mr Abedy failed to pay the arrears which were due and owing to Arise; and
d) Ausie & Azar's failure to make payment of rent constituted a breach of an essential term of the Lease.
Termination of the Agreement
17 Arise alleges that by Ausie & Azar's failure to pay the rent, it terminated the Lease.
18 Arise subsequently reentered the Premises. As a result of the termination of the lease, Arise was required to find a new tenant for the Premises. On or around 9 March 2015, Arise entered into a Lease of the Premises with a new tenant.
The Act
19 The Act relevantly provides:
6. Disclosure statement, tenant's rights if not given by landlord etc.
(1) Where a retail shop lease is entered into and the tenant has not, at least 7 days before the entering into of the lease, been given a disclosure statement in accordance with subsection (4) or the disclosure statement given is incomplete or contains false or misleading information, the tenant may, in addition to exercising any other right, do either or both of the following -
(a) within 6 months after the lease was entered into give to the landlord written notice of termination of the lease, unless subsection (3) prevents termination;
(b) apply in writing to the Tribunal for an order that the landlord pay compensation to the tenant in respect of pecuniary loss suffered by the tenant as a result of -
(i) the omission of the landlord to give a disclosure statement in accordance with subsection (4); or
(ii) the giving of an incomplete disclosure statement by the landlord; or
(iii) the giving of false or misleading information by the landlord in the disclosure statement.
(3) A tenant cannot terminate a lease under this section on the ground that the tenant has been given a disclosure statement that is incomplete or contains false or misleading information if
(a) the landlord has acted honestly and reasonably and ought reasonably to be excused for the failure concerned; and
(b) the tenant is in substantially as good a position as the tenant would have been if the statement had been complete or had not contained the false or misleading information.
…
15C. Landlord not to engage in unconscionable conduct
(1) A landlord under a retail shop lease shall not, in connection with the lease, engage in conduct that is, in all the circumstances, unconscionable[.]
15F. SAT's powers as to unconscionable conduct
(1) A landlord or tenant, or former landlord or tenant, under a retail shop lease or former retail shop lease who suffers, or is likely to suffer, loss or damage because of unconscionable conduct of another person that contravenes section 15C or 15D may apply in writing to the Tribunal for an order that the other person pay compensation in respect of the loss or damage, or for other appropriate relief[.]
16. Party to lease may refer question to SAT
(1) Subject to section 11(5), a party to a retail shop lease may refer to the Tribunal any question between the parties which he believes to be a question arising under the lease and the Tribunal shall -
(a) determine whether or not the question referred to the Tribunal is a question arising under the lease; and
(b) if it is such a question, hear and determine it.
(2) The matter for determination referred to in subsection (1)(a) may be determined by the Tribunal in such manner as it thinks fit, subject to each party being given an opportunity to make a written submission.
16C. Parties to lease not to engage in misleading etc. conduct
A party to a retail shop lease must not, in connection with the lease, engage in conduct that is misleading or deceptive to another party to the lease or that is likely to mislead or deceive another party to the lease.
16D(3). SAT's powers as to misleading etc. conduct
Without limiting section 26, in proceedings in relation to a misleading or deceptive conduct application, the Tribunal may make any one or more of the following orders that it considers appropriate -
(a) an order that a party to the proceedings pay money to a specified person, whether by way of debt, damages or restitution, or refund any money paid by a specified person;
(b) an order that a specified amount of money is not due or owing by a party to the proceedings to a specified person, or that a party to the proceedings is not entitled to a refund of any money paid to another party to the proceedings.
26. SAT's powers to make orders
(1) Without limiting any power to make an order that is conferred by the State Administrative Tribunal Act 2004 but subject to this Act the Tribunal may make
(a) an order that requires a party to any matter before it to pay money to a person specified in the order; or
(b) an order for a party to any matter before it to do, or refrain from doing, anything specified in the order; or
(c) an order dismissing any matter before it.
(1a) The power in subsection (1)(b) includes power for the Tribunal to order the parties to enter into an agreement varying a retail shop lease as specified in the order where the Tribunal has found that the tenant under the lease was before entering into the lease misled by the landlord as to the meaning or effect of a term or condition of the lease.
(1aa) The Tribunal may, where it considers it appropriate to do so to resolve the matter concerned, make an order terminating a retail shop lease.
An application under s 27 of the Act
20 Section 27 of the Act provides:
(1) If both a court and the Tribunal have jurisdiction to determine a matter, proceedings to determine the matter may be instituted either -
(a) before the court; or
(b) before the Tribunal,
but not both.
…
(3) If a matter is before the Tribunal and is one that a court also has jurisdiction to determine, the Tribunal may order it to be transferred to the court if -
(a) all parties to the matter so agree; or
(b) the Tribunal, on its own initiative or on the application of a party, decides it is in the interests of justice to do so.
(4) Where -
(a) an unconscionable conduct application or misleading or deceptive conduct application has been made; and
(b) at the time it was made no issue arising under the application was the subject of civil proceedings before a court,
a court has no jurisdiction to hear or determine such an issue in civil proceedings … .
…
(6) Where -
(a) an application referred to in subsection (4) has been made; and
(b) at the time it was made an issue arising under the application was the subject of civil proceedings before a court,
the Tribunal, on becoming aware of those proceedings, ceases to have jurisdiction to hear or determine the issue unless subsection (7) applies.
(7) This subsection applies if -
(a) the proceedings referred to in subsection (6) are, or the part of those proceedings relating to the issue referred to in that subsection is, transferred to the Tribunal by the court concerned; or
(b) those proceedings are, or that part of those proceedings is, withdrawn or dismissed by the court, or by another court on appeal in those proceedings, for want of jurisdiction or without deciding the issue on its merits; or
(c) as a result of judicial review, a court quashes or declares invalid those proceedings or that part of those proceedings or any order, judgment or decision made in those proceedings in relation to the issue, on the ground that the court concerned had no jurisdiction to hear and determine the issue.
21 On 19 February 2015, Arise issued a writ in the District Court of Western Australia against Ausie & Azar and Mr Abedy claiming $93,067.68 and interest under the Deed - not for default under the Lease.
22 On 17 March 2015, Ausie & Azar and Mr Abedy filed a defence and counterclaim essentially denying Arise's claim.
23 Paragraph 17(d) of the original defence and counterclaim as filed on 17 March 2015 alleged that Ausie & Azar and Mr Abedy signed the Deed under duress. The particulars of the alleged duress were:
(i) At the time of signing the Deed, [Ausie & Azar] had with the knowledge and agreement of [Arise], agreed to pay to Croissant Express the amount of $50,000 in order to sever the franchise arrangements between Croissant Express and [Ausie & Azar] and to compromise all claims between them.
(ii) The terms of this agreement between Croissant Express and the [Ausie & Azar] are recorded in a deed of settlement and release dated 17 July 2014. In that deed, [Mr Abedy] guarantees the performance by [Ausie & Azar] of its obligations under the deed, including the obligation to pay $50,000 to Croissant Express.
(iii) As at the date of signing the Deed, namely 18 July 2014, the date for payment of $50,000 to Croissant Express had passed.
(iv) [Arise] had agreed to pay the amount of $50,000 due to Croissant Express but had not done so.
(v) Adam Lisle on behalf of [Arise] orally informed [Mr Abedy] on behalf of [Ausie & Azar] at a meeting at [Arise's] offices in Subiaco on 18 July 2014 that
A. [Arise] would not pay $50,000 to Croissant Express (which [Arise] had agreed to do), or any further amounts due to Cullen Babington Macleod for legal expenses relating to [Ausie & Azar's] dispute with Croissant Express (which [Arise] had agreed to do), unless [Ausie & Azar] and [Mr Abedy] signed the Deed.
B. If [Ausie & Azar] and [Mr Abedy] did not sign the Deed, [Arise] would terminate the Lease and that [Ausie & Azar] would have to vacate the premises the subject of the Lease.
(vi) Under the duress mentioned above, [Ausie & Azar] and [Mr Abedy] signed the Deed which they would not otherwise have done.
24 Ausie & Azar and Mr Abedy amended their defence on 10 June 2015 to add a claim of misleading the court. The claim of duress remained in the amended defence.
25 It is implicit in Ausie & Azar's and Mr Abedy's submissions that duress is a relevant form of unconscionable conduct. The contrary position was not argued by Arise.
Tribunal proceedings
CC 409 of 2015
26 On 19 March 2015, Arise filed an application in the Tribunal (CC 409 of 2015) naming Ausie & Azar and Mr Abedy as respondents.
27 Arise's application CC 409 of 2015 identified the referred questions as:
1. The Lease Agreement between the parties for the letting of the premises at Unit 15, Joondalup Square (more accurately described as Lot 811 on Deposited Plan 74906, being part of the land in certificate of title Volume 2809 Folio 92) is a lease to which the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA) applies.
2. What amount of monies should [Ausie & Azar] and [Mr Abedy] pay to [Arise] by reason of [Ausie & Azar's] failure to pay rent under the Lease Agreement[?]
3. What amount of monies should [Ausie & Azar] and [Mr Abedy] pay to [Arise] by reason of the termination of the Lease Agreement[?]
28 Arise's statement of issues, facts and contentions in CC 409 of 2015, filed on 28 April 2015, sought the following relief:
a) A declaration from the SAT that:
1. this dispute concerns a question arising under a lease pursuant to section 16(1)(a) of the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA); and
2. this dispute is to be heard and determined by the SAT pursuant to section 16(1)(b) of the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA).
b) An order from the SAT pursuant to section 26(1) of the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA) that [Mr Abedy] pay to [Arise] damages in the amount of $153,060.72 by reason of:
1. [Ausie & Azar's] breach of its obligations under the Lease Agreement; and
2. the guarantee and indemnity of [Ausie & Azar's] obligations under the Lease Agreement which was provided by [Mr Abedy].
30 Ausie & Azar's and Mr Abedy's statement of issues, facts and contentions filed on 26 May 2015 alleges nondisclosure and misleading conduct arising from alleged representations by Arise.
31 Although Ausie & Azar and Mr Abedy did not allege unconscionable conduct in CC 409 of 2015, they alleged it in CC 780 of 2015, filed on 19 May 2015.
CC 778, 779 and 780 of 2015
32 On 19 May 2015, Mr Abedy and Ausie & Azar filed applications in the Tribunal naming Arise as respondent (CC 778 of 2015, CC 779 of 2015 and CC 780 of 2015).
33 Mr Abedy and Auzie & Azar sought the following relief in CC 778/2015:
1. A declaration and/or order pursuant to section 16D(1) of the Commercial Tenancy (Retail Shops) Agreements Act 1985 that the Respondent has contravened section 16C(1) of the Commercial Tenancy (Retail Shops) Agreements Act 1985. [i.e. misleading and deceptive conduct].
2. An order pursuant to section 16D(3) of the Commercial Tenancy (Retail Shops) Agreements Act 1985 that [Arise] pay damages to [Ausie & Azar and Mr Abedy] in respect of:
(a) The losses suffered by the business of [Ausie & Azar] and [Mr Abedy] run from the leased premises from 21 June 2014 to 23 January 2015;
(b) All expenses incurred by [Ausie & Azar and Mr Abedy] in establishing the business run from the leased premises, including but not limited to the cost of the fit-out and the purchase of equipment;
(c) All monies paid to [Arise] by [Ausie & Azar] and [Mr Abedy] under the Lease Agreement; and
(d) The losses incurred by [Ausie & Azar] and [Mr Abedy] as a result of the termination of the Lease Agreement, including but not limited to the cost of the equipment and stock held at the leased premises at the time of termination and the amount of the forfeited bank guarantee provided by the First Applicant.
3. An order pursuant to section 16D(3)(b) of the Commercial Tenancy (Retail Shops) Agreements Act 1985 that [Ausie & Azar] and [Mr Abedy] do not owe [Arise]:
(a) Any outstanding rental monies pursuant to the lease agreement;
(b) Any monies by reason of the termination of the lease agreement.
4. Such other orders pursuant to section 16D(3) as the Tribunal thinks fit.
34 On 19 May 2015, in CC 778 of 2015 Mr Abedy and Ausie & Azar filed a statement of misleading and deceptive conduct, as follows:
1. In or around November 2012 the [Ausie & Azar] and [Mr Abedy] (together 'the Applicants') entered into an Agreement for Lease with [Arise] in respect of the [Ausie & Azar's] and [Mr Abedy's] proposed lease of premises being Tenancy E at a shopping centre named Joondalup Square ('the Premises').
2. The Agreement for Lease provided that [Ausie & Azar] and [Mr Abedy] would run a Croissant Express franchise from the Premises.
3. The Agreement for Lease provided that the lease of the Premises ('Joondalup Lease') would commence six weeks after [Arise] had completed the construction and fit-out of Joondalup Square.
4. At or around the time the Agreement for Lease was entered into, [Mr Abedy] verbally requested of Mr Adam Lisle, the director of [Arise], to advise what other businesses were going to be renting premises in Joondalup Square.
5. Mr Lisle informed [Mr Abedy] in words to the effect of:
4.1 There was going to be a Subway, a burger place, a Japanese cafe/restaurant and a Mexican cafe/restaurant;
4.2 A tenant for one of the premises had not yet been confirmed, but that the premises was going to be tenanted by either Sumo Salad, Oporto or an Indian cafe/restaurant
- (together 'the Representations').
7. On or around October 2013, [Mr Abedy] had a conversation with Mr Lisle during which he again asked what businesses were going to be renting premises in Joondalup Square.
8. Mr Lisle responded to [Mr Abedy's] query by repeating the Representations to [Mr Abedy].
9. In reliance on the Representations, [Ausie & Azar] and [Mr Abedy] entered into the Joondalup Lease in late October 2013.
10. [Ausie & Azar] and [Mr Abedy] commenced trading from the Premises on 27 March 2014, at which time one tenancy in Joondalup Square remained empty.
11. In or around May 2014 [Mr Abedy] noticed a sign on the empty tenancy that stated words to the effect that a 'Coffee Club' outlet was coming soon.
12. On 21 June 2014 a Coffee Club franchise opened in Joondalup Square where the empty tenancy had been. The Coffee Club is a business similar to that operated by [Ausie & Azar].
35 In CC 779 of 2015, Mr Abedy and Ausie & Azar sought the following relief:
1. A declaration and/or order that [Arise] has contravened section 6(4) of the Commercial Tenancy (Retail Shops) Agreements Act 1985. [i.e. provision of a notice to seek independent legal advice].
2. An order pursuant to section 6(1)(b) of the Commercial Tenancy (Retail Shops) Agreements Act 1985 that [Ausie & Azar] and [Mr Abedy] be compensated for loss suffered as a result of [Arise's] contravention of section 6(4) of the Commercial Tenancy (Retail Shops) Agreements Act 1985, such loss including but not limited to:
(a) The losses suffered by the business run from the leased premises from 21 June 2014 to 23 January 2015;
(b) All expenses incurred by [Ausie & Azar] and [Mr Abedy] in establishing the business run from the leased premises, including but not limited to the cost of the fit-out and the purchase of equipment;
(c) All monies paid to [Arise] by [Ausie & Azar] and [Mr Abedy] under the Lease Agreement; and
(d) The losses incurred by [Ausie & Azar] and [Mr Abedy] as a result of the termination of the Lease Agreement, including but not limited to the cost of the equipment and stock held at the leased premises at the time of termination and the amount of the forfeited bank guarantee provided by [Mr Abedy].
3. Such other orders pursuant to section 6(1) or section 26 of the Commercial Tenancy (Retail Shops) Agreements Act 1985 as the Tribunal thinks fit.
36 In CC 780 of 2015, Ausie & Azar and Mr Abedy sought the following relief:
1. A declaration and/or order pursuant to section 15F(1) of the Commercial Tenancy (Retail Shops) Agreements Act 1985 that [Arise] has contravened section 15C(1) of the Commercial Tenancy (Retail Shops) Agreements Act 1985. [i.e. unconscionable conduct].
2. An order pursuant to section 15F(3)(a) of the Commercial Tenancy (Retail Shops) Agreements Act 1985 that [Arise] pay damages to [Mr Abedy] and [Ausie & Azar] in respect of:
(a) The losses suffered by the business of [Mr Abedy] and [Ausie & Azar] run from the leased premises from 21 June 2014 to termination of the lease agreement on 23 January 2015;
(b) All expenses incurred by [Mr Abedy] and [Ausie & Azar] in establishing the business run from the leased premises, including but not limited to the cost of the fit-out and the purchase of equipment;
(c) All monies paid to the [Arise] by [Mr Abedy] and [Ausie & Azar] under the Lease Agreement; and
(d) The losses incurred by the [Mr Abedy] and [Ausie & Azar] as a result of the termination of the Lease Agreement, including but not limited to the cost of the equipment and stock held at the leased premises at the time of termination and the amount of the forfeited bank guarantee provided by [Mr Abedy].
3. An order pursuant to section 15F(3)(b) of the Commercial Tenancy (Retail Shops) Act 1985 that [Mr Abedy] and [Ausie & Azar] do not owe [Arise]:
(a) Any outstanding rental monies pursuant to the Lease Agreement;
(b) Any monies by reason of the termination of the Lease Agreement.
4. Such other orders pursuant to section 15F(3) of the Commercial Tenancy (Retail Shops) Act 1985 that the Tribunal thinks fit.
37 Ausie & Azar and Mr Abedy have not provided details of the unconscionable conduct. The duress pleaded in the District Court is not set out in the Tribunal matter. Therefore, it is not possible to reach a conclusion as to what the actual conduct was and to make a finding under s 27(4) of the Act.
Ausie & Azar and Mr Abedy's submissions 18 August 2015
38 Ausie & Azar and Mr Abedy's submissions in relation to s 27 of the Act relevantly state:
…
9. By its application in CC 409 of 2015 filed 19 March 2015, Arise claims unpaid rent following the purported termination of the relevant Lease and re-entry of the relevant Premises, on 27 January 2015. Arise relies upon a termination notice sent to the Applicants on 27 January 2015, in which failure to pay a sum which included the amounts alleged to be then overdue under the Deed, was relied upon in re-entering the Premises. (See paragraphs 16 and 17 of Arise's Statement of Issues, Facts and Contentions, filed 28 April 2015).
10. In the Respondent's Statement of Issues, Facts and Contentions filed 26 May 2015, the Respondent raises the issues of misleading and deceptive conduct, contrary to section 16C(1) of the Act, unconscionable conduct in relation to the contrary to section 15C(1) of the Act and whether or not the Applicant was entitled to terminate the Lease. In relation to the latter, the Applicants rely upon a rent free period expiring on 12 July 2014. (See paragraph 22 of the Statement of Issues, Facts and Contentions), alternatively mid-September 2014 (See paragraph 23 of the Statement of Issues, Facts and Contentions).
11. The Applicants allege that Arise was not entitled to terminate the Lease, was not entitled to issue arrears notices and that the Lease was wrongfully terminated. (See paragraph 29 of the Statement of Issues, Facts and Contentions).
12. In determining the various Applications presently before the State Administrative Tribunal, the Tribunal will be required, amongst other things, to determine whether any rent was in fact in arrears as at 27 January 2015, the date upon which Arise re-entered the premises. It is submitted this is a fundamental question. As part of that process the Tribunal will [be] required to consider whether or not in fact amounts referred to in the Deed were due and owing.
13. In the District Court Proceedings, the Court will be asked to determine whether or not any amounts are owing under the Deed. The District Court proceedings pre-date the Tribunal applications.
14. Accordingly, the Applicants submit that pursuant to section 27(6) the Tribunal no longer has jurisdiction to hear or determine the issues raised in the applications presently before the Tribunal.
15. In the alternative, given the issues of misleading or deceptive conduct and unconscionable conduct raised by the applications in CC 778, 779 and 780 of 2015, there are similar allegations in relation to the conduct of Arise in the District Court Proceedings. Further, there will be the need for similar evidence to be called before the District Court proceedings and the Tribunal proceedings leading to the inevitable potential for conflicting findings. This is obviously an undesirable outcome.
16. Finally, it is submitted that is it undesirable that identical parties be engaged in two sets of proceedings in two jurisdictions dealing with similar issues and occurring two sets of legal costs.
Arise's submissions 25 August 2015
39 Arise's submissions in relation to s 27 of the Act relevantly state:
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3 The District Court proceedings have been entered for trial and a pre-trial conference date has been set for 31 August 2015. If there is no resolution of the pre-trial conference, the dispute will proceed to trial.
4 In the District Court proceedings, Arise sues on a Deed[.] The claim is in the nature of a recovery of a debt[.]
5 In the Tribunal proceedings, Arise sues for breaches of various covenants under a commercial lease.
6 The Ausie & Azar parties seek incorrectly to intertwine the claims in the District Court and in this Tribunal. They are properly separate and distinct.
7 It is made clear in the documents filed by Arise in the Tribunal proceedings CC 409 of 2015 that the lease was terminated for nonperformance by the Ausie & Azar parties of their obligations under the lease. Arise's claim is articulated in the Arise Statement of Issues, Facts & Contentions in CC 409 of 2015 filed 28 April 2015 (SIFC)[.]
8 The monetary relief sought is consistent with the certificate pursuant to clause 10.10 of the lease (paragraphs 22 and 23 of the SIFC)[.] It is apparent that no sum claimed in the certificate arises from any sum Arise claims in the District Court proceedings under the Deed. Those sums are claimed in the District Court.
9 While it may be that tax invoices were sent to the Ausie & Azar parties that included claims for payments under the Deed, there was no express reliance on those sums as forming a basis for termination and, indeed, there were clear failures of non-payment of base rental, which justified the termination (see clause 10.1.1 of the lease at tab 6 of Arise's bundle). The termination notice is document 11 in Arise's bundle.
10 The Ausie & Azar parties rely on section 27(3) and section 27(6) of the Commercial Tenancy (Retail Shops) Agreements Act 1985. It is apparent from the submissions that an order is sought pursuant to section 27(6) of that Act to the effect that this Tribunal does not have jurisdiction to hear the claims. It can only be claims CC 778, 779 and 780 of 2015 to which those submissions are directed. There is no claim in CC 409 of 2015 asserting unconscionability or misleading or deceptive conduct.
11 In the District Court proceedings, the Ausie & Azar parties did not raise allegations of misleading and deceptive conduct claims or a duress claim, which they seek to characterise as an unconscionability claim, until their defence and counterclaim of 10 June 2015.
12 The Ausie & Azar proceedings CC 778, 779 and 780 had all been commenced in this Tribunal prior to 10 June 2015. It cannot therefore be said that the conditions for section 27(6)(b) of the Act had been satisfied. That would have required those issues to have been raised in the District Court proceedings prior to the commencement of actions CC 778, 779 and 780 of 2015. For that reason alone, it cannot be said that the Tribunal has ceased to have a jurisdiction to hear actions CC 778, 779 and 780 of 2015.
13 There is no reason why this Tribunal would need to determine what role the Deed played in the capacity of Arise to terminate the lease. Arise concedes that if there were findings made that there were no amounts of base rental under the lease outstanding at the time of termination, then there would not have been a basis, based on the failure to pay rental, to enter the premises. It is no part of the Arise case before the Tribunal that any default by Ausie & Azar parties under the Deed created a basis upon which the lease was terminated.
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40 Arise has not argued that the District Court does not have jurisdiction in the issues raised in the matter.
Tribunal's analysis
41 Arise essentially makes two points in relation to the s 27 application:
1) the issue of duress was not raised until 10 June 2015; and
2) the District Court action is for a debt under a Deed which is distinct from the Lease claims in the Tribunal.
42 Arise is plainly wrong in relation to the first point. The issue of duress was raised in the defence and counterclaim filed on 9 March 2015.
43 Section 27(6) of the Act applies only if an issue arising under the application was the subject of a civil proceeding before a court.
44 On the applications in their present form, the Tribunal cannot conclude that s 27(6) of the Act applied as at the date of the filing of the Tribunal applications.
45 The defence in the District Court proceedings was filed on the same day as Arise filed its application in CC 409 of 2015 in this Tribunal.
46 The Tribunal has difficulty understanding why Arise filed CC 409 of 2015 in this Tribunal, rather than in the District Court. Contrary to Arise's submission, the issues in both matters are intertwined. If the instalments allegedly payable under the Lease were found not to be payable by reason of Arise's conduct, then no debt could be claimed. Arise's conduct is central to the Tribunal applications and the District Court action.
47 The Tribunal accepts that the degree of intertwining may not have been immediately apparent to Arise when it filed CC 409 of 2015, given that it only received the defence and counterclaim in the District Court proceedings on 19 May 2015. However, given that the claims are essentially for money ultimately arising from a landlord/tenant/guarantor relationship, it would have made more sense to commence all proceedings in the District Court.
48 Whatever the merits of the original decision, it is now apparent that there are common factual issues in the District Court proceedings and the Tribunal proceedings.
49 Both the Tribunal applications and the District Court matter rely upon the Lease, the circumstances leading to the signing of the Lease and the following events. Since the Deed arises from payments due under the Lease, it is also obvious that many of the factual arguments about the Lease will be related to the Deed.
50 The Tribunal accepts Ausie & Azar's and Mr Abedy's submissions that it would be undesirable that identical parties be engaged in two sets of proceedings in two jurisdictions. In addition to the costs issues, there is an obvious risk of conflicting findings of fact.
51 The Tribunal has concluded that it is in the interests of justice that CC 409 of 2015 and CC 778, 779 and 780 of 2015 be transferred to the District Court of Perth, Western Australia pursuant to s 27(3) of the Act.
Orders
1. Matters CC 409 of 2015 and CC 778, 779 and 780 of 2015 to be transferred to the District Court of Perth, Western Australia, pursuant to s 27 of the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA).
- I certify that this and the preceding [51] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
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JUSTICE J C CURTHOYS, PRESIDENT
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