Akora (Bondi Junction) Pty Limited v Buttrose

[2008] NSWADT 275

CITATION:	Akora (Bondi Junction) Pty Limited v Buttrose [2008] NSWADT 275
DIVISION:	Retail Leases Division
PARTIES:	APPLICANT Akora (Bondi Junction) Pty Limited RESPONDENT Richard William Buttrose
FILE NUMBER:	075175
HEARING DATES:	10 September 2008
SUBMISSIONS CLOSED:	10 September 2008
DATE OF DECISION:	13 October 2008
BEFORE:	Molloy G - Judicial Member
CATCHWORDS:	Jurisdiction
LEGISLATION CITED:	Retail Leases Act 1994
CASES CITED:	Sassine v. McGlinn & anor t/as Westland Produce (RLD) [2008] NSWADTAP 54
REPRESENTATION:	APPLICANT C Fox, solicitor RESPONDENT In person
ORDERS:	1. Declaration that the Tribunal has jurisdiction to hear and determine the Application for Original Decision filed 24 September 2007 2. The Application for Declaration filed by the Respondent 22 August 2008 is dismissed 3. The Application for Interim Orders filed by the Applicant 5 September 2008 is adjourned for further directions 4. Costs are reserved 5. The proceedings are listed for further Directions before me on 6 November 2008.

Background

1 By registered lease AA340724E Messrs Roche and Buttrose leased Shop 1 and Level 1, 262 Oxford Street, Bondi Junction (“the premises”) to the Applicant. The lease was for a term of 3 years commencing 27 October 2003, terminating 26 October 2006 together with two 5 year options for renewal.

2 Subsequent to the lease being entered into Mr Buttrose, the Respondent, on or about 28 September 2004, acquired the interest of Mr Roche in the property and in the lease such that the Respondent became the sole lessor.

3 By Application for Original Decision filed 24 September 2007 the Applicant (as lessee) commenced proceedings asserting a breach of Section 16D of the Retail Leases Act, asserting a failure by the Respondent to return the security bond (as adjusted) and asserting an amount due from the Respondent on account of lost interest; the total claim being $44,009.00.

4 The proceedings have had a chequered career through the Tribunal. By Order made 6 December 2007 Fox JM ordered, ex parte, the Respondent pay the Applicant $37,363.39 plus interest at $6,645.56, in total $44,009.00. A costs order was also made. Those Orders were set aside by the Appeals Panel on 1 August 2008 and the matter remitted to the Divisional Tribunal for further hearing. Consequent upon various directions the Respondent filed on 22 August 2008 a formal Application seeking a declaration that the Tribunal had no jurisdiction. This Application asserted that the premises were used “predominately for the purpose of operating a large scale food manufacturing facility and a catering business”; that the Applicant “used a large part of the leased area as commercial office space”; that “commercial office space, food manufacturing, food wholesaling and catering businesses are not listed Schedule 1 of the Retail Leases Act 1994”; and that, as a consequence, registered lease AA340724E “is not a retail lease”, thus the Tribunal “does not have jurisdiction to hear the matter …”.

Sassine v. McGlinn

5 The Appeals Panel in Sassine v. McGlinn & Anor t/as Westland Produce (RLD) [2008] NSWADTAP 54 has expressed concerns about the approach to be taken by the Tribunal in deciding whether it has jurisdiction in proceedings on the ground that the lease which proceedings are concerned is a “retail shop lease” within the meaning of the Retail Leases Act 1994. That appeal arose out of a decision of mine ([2008] NSWADT 54) in which I determined that the Tribunal had jurisdiction because the lease in that matter was a “retail shop lease”. The parties before me proposed a procedure, which I adopted, for determination of the issue of jurisdiction and, consistent with that approach and with the consent of both parties, I then considered the matter and determined the issue of jurisdiction.

6 The Appeals Panel took the view (at [48]) that the approach that I adopted “in obtaining and assessing evidence on the issue of jurisdiction gives cause for concern.” The Appeals Panel thought (at [52]) that “the evidentiary basis for the Tribunal’s decision was insufficient … to support the order that it apparently made.” The Order that was made was a declaration that “the Tribunal has jurisdiction to hear and determine the Amended Application” and thus it purported “to resolve finally for the purpose of these proceedings the question of jurisdiction”. The Appeals Panel differentiated between evidence on an interlocutory basis and evidence to support a final order on jurisdiction, this even accepting that the evidence put before the Tribunal at first instance was by consent. The Appeals Panel expressed this opinion at [52]: “At most it was adequate for an order, in the nature of a declaration, to the effect that the evidence relating to jurisdiction adduced by the Applicant/lessees was capable of supporting a decision that the Tribunal had jurisdiction”. The Appeals Panel adopted the approach that the decision at first instance was a provisional decision only and that in all the circumstances neither the Divisional Tribunal nor the parties had given consideration to two vital questions (at [56]): “(a) the nature of the determination – interim or final – that the Tribunal would make; and (b) in the light of the answer to this question, what procedures for obtaining and assessing evidence should be adopted by the Tribunal”. At [57] the Appeals Panel expressed the opinion that before making a declaration in a final form the Divisional Tribunal “should have sought evidence from (the lessor) on factual matters relevant to jurisdiction” such that in all the circumstances the lessor (in that case) (at [58]) “given the lack of any contrary indication from the Tribunal, that his objection to jurisdiction would or at least might be interpreted” as provisional only. The Appeals Panel adopted the view that a final order on the question of jurisdiction must be based upon sufficient evidence and that in the circumstances of that appeal the appellant is (at [60]) “not precluded in this appeal from relying on this ground even though he did not file evidence such as would have repaired the deficiency”.

7 The Appeals Panel went on to consider various other factors, observing at [65] the “factual issues to be resolved in determining jurisdiction under the Retail Leases Act may indeed be complex and finally balanced”; and expressed concern [66] that any “provisional decision on jurisdiction, based on evidence of the type that is appropriate and sufficient to ground interim relief, is the likelihood that the issue would have to be relitigated. If jurisdiction is denied, that will mean (presuming that the applicant had the opportunity to file all relevant evidence) that the proceedings can be summarily dismissed. The applicant’s only possible avenue would be to appeal against the decision. But if the Tribunal determines (provisionally) that it has jurisdiction, it will be obliged, at or before the substantive hearing of the proceedings, to give to the respondent the opportunity to raise again the issue of jurisdiction, to tender evidence designed to rebut the applicant’s evidence on this issue and to cross-examine the applicant’s witnesses. The Tribunal will then have to determine the question of jurisdiction all over again”.

8 And, at [67] the Appeals Panel said “For these reasons we consider that the Tribunal adopted an unsatisfactory approach regarding the evidence on which its decision on jurisdiction should be based. A preferable approach would have involved basing the decision on such admissible evidence as the parties sought to tender after being given an explicit opportunity to do so and on such cross-examination as they wished to conduct. The evidence that it did take into account was adequate only to support provisional decision which does not greatly advance the resolution of the dispute between the parties.”

Conclusions from Sassine v. McGlinn

9 As I read the decision of the Appeals Panel it is not in the interests of justice to spend the time of the parties and the Tribunal in arguing and provisionally determining a jurisdictional issue. With respect, I agree.

10 Consequently, it seems to me that before the Tribunal embarks upon consideration of jurisdiction as a discrete issue it will need to be absolutely sure:

a) that the parties understand that any decision on jurisdiction is final and binding upon them, save as to any rights of appeal;

b) that the parties understand that, whatever the result, they will not be permitted to lead evidence in any future hearing that would be contrary to the findings and decision on jurisdiction;

c) that all issues relating to jurisdiction are ventilated before the Tribunal such that there are no remaining or outstanding jurisdictional questions;

d) that all evidence on the jurisdictional issues is placed before the Tribunal such that no party can be heard to say that it did not have the opportunity of leading evidence on those issues;

(e) that all deponents required for cross-examination are in fact called, or deliberately not called; that all evidentiary points are taken at the hearing; and the parties exhaust by relevant cross-examination all called witnesses on the discrete issue of jurisdiction.

11 Thus, provided that those principles/procedures are followed then the decision of the Tribunal on the discrete issue of jurisdiction is final and binding, save as to any appeal rights. So, where parties wish to argue the discrete issue of jurisdiction and the principles/procedures as outlined above and in Sassine are followed, the decision is final (save as to any appeal rights) and, if the Tribunal is held to have jurisdiction, then the only issues between the parties are their respective rights as otherwise agitated and the Tribunal is able to determine those rights without any further reference to its jurisdiction.

Procedures

12 Prior to, and at the outset, of this hearing I drew to the attention of the parties the Appeals Panel’s decision in Sassine and then I spent the first half hour or more of the hearing making sure that the parties were content to proceed having regard to the above principles/procedures. I was assured by all parties that they did not wish to defer the hearing on jurisdiction, that they wished the question of jurisdiction to be determined, that they had filed all affidavit and other material that they wished to file on this issue, that deponents were available for cross-examination, alternatively would not be called, that there were no others matters that were going to be raised by any party relating to jurisdiction (such that all jurisdictional issues would be ventilated at the hearing) and that they understood that any decision would be final and binding (save as to any appeal rights) and that, should the Tribunal determine that it had jurisdiction then the hearing on the substantive issues could proceed and that no party would be able to argue in the future any question of jurisdiction or lead any evidence that would be contrary to the jurisdictional determination or which would, directly or by inference, throw any doubt upon the jurisdiction of the Tribunal.

13 During the course of the hearing I permitted the Respondent to put into evidence such additional material as he wished, even though prior notice had not been given to the Applicant. I formed the opinion that the documents should be admitted into evidence because they were evidence of what the documents were but may not be evidence of the content of the documents as being true; and for the secondary reason that in my opinion the Applicant was not so prejudiced by such tender that the Applicant could not deal with the additional evidence such as it was.

Respondent’s Submissions

14 The Respondent filed a detailed affidavit, which purported to address the issue of jurisdiction and various matters outside the question of jurisdiction. Those latter aspects have not been dealt with as part of this decision. The Respondent also gave oral evidence and was cross-examined. He also tendered various other documents including the Application for Original Decision of the Applicant and two affidavits of a director of the Applicant, Ms Simmone Logue, sworn 26 November 2007 and 4 September 2008. It is important for me to observe that I recommended to the Respondent, on more than one occasion, that he seek and obtain legal advice and representation in these proceedings and, in addition, at the hearing he was warned by me that the tender of the documents of the opposing party was generally not recommended simply because such evidence was often a two-edged sword. The Respondent insisted upon representing himself and he insisted upon relying upon the sworn evidence led on behalf of the Applicant.

15 The nub of the Respondent’s submissions was that the lease was “not a “retail shop lease”” in that the premises were not used, or proposed to be used, wholly or predominately for the carrying on of one or more of the businesses prescribed in Schedule 1. The Applicant submitted that the premises “were used for office space and to run a catering business”. The Respondent put great emphasis on the fact (I shall deal with this below) that Ms Logue described her business as “a catering business” and that the premises were used “for the purposes of operating a catering business”. Thus, it was submitted, the premises were used “for the purposes of office space and to run a catering business”, uses not within the businesses prescribed in Schedule 1. The submission, repeated itself on a number of occasions but in substance asserted that at “all material times and on the basis of the facts put forward by the Applicant, there was never any doubt that the use of the premises “reasonably contemplated by the parties when they entered into the lease” … was for office space and to manufacture food and run a catering business … office space, food manufacturing and catering businesses are not retail businesses, are not listed in Schedule 1 … and therefore the definition of a retail shop lease has not been met”.

Facts

16 The starting point for a consideration of this issue is the lease. The “permitted use” is stated to be “any lawful retail purpose”.

17 The Respondent’s evidence was that he visited the premises “for various reasons from time to time”. He admitted that he went to the premises with Ms Logue on about 10 occasions and without her on about 50 occasions. On these latter occasions he did not inspect the premises but rather saw a retail shop front and ground floor kitchen. He would purchase food and frankly admitted that he “attended (the premises) because it was a take-away premises”, that coffee, soft drinks and sandwiches were available and he observed a small part of the premises being used for the making of pies. He stated that there was a lot more space out the back of the premises used for other purposes but he did not see any baking of cakes or puddings but only pies. He “observed that the Applicant’s scale of food production was massive”.

18 It would seem that prior to the lease being entered into the Applicant (who appears to have traded under the name “Simmone Logue”) wrote to the Respondent by way of a Letter of Offer 14 August 2003. In that letter the Applicant described the proposed use of the premises as “sale and manufacture of fine foods, foodstuffs, patisserie lines, coffee, drinks and catering”. The Applicant described its business as having been trading for over 10 years at a number of retail outlets, namely 349 Darling Street, Balmain (“the Balmain shop”), 470 Oxford Street, Paddington (“the Paddington shop”), 59 Birrell Street, Bondi Junction (“the Bondi Junction shop”), 2 Cross Street, Double Bay (“the Double Bay shop”) and also “having a head/admin office” at 401 Darling Street, Balmain (“the head office”). The Applicant described the company as “an experienced fine food retailer, with a proven track record. Simmone Logue is a well-respected member of the Sydney food establishment. Simmone Logue Fine Food Company is a premium producer of quality retail and wholesale products”. In the final paragraph the Applicant stated that it would “be looking to use this premises as our main manufacturing facility and this will need us to be able to use it 24 hours, 7 days from time to time. The minimum we would require would be 6.00am to midnight, 7 days.”

19 Each page of the Letter of Offer shows the various stores and shops of the Applicant. The Balmain shop, the Double Bay shop and the Paddington shop are each described as a “Fine Foods Store”; the Bondi Junction shop is described as a “Pie Shop” and the head office is described as “Head Office”. There is a stated website and e-mail contact address.

20 It is also significant that as part of the Letter of Offer terms the Applicant proposed that “all equipment and fit out be left in situ”, that “all equipment to be in working order …” and that “all equipment to be maintained as lessee’s expense”. It is significant that at the hearing there was no evidence at all led by the Respondent as to what was the equipment and fit out at the time of the commencement of the lease for the premises. One would have thought that a party seeking to establish that the premises were not a retail shop but rather premises used for “a catering business”, would have attempted to demonstrate that the equipment and fit out was, or likely to be, equipment and fit out that would be used in a catering business as distinct from a retail shop business within Schedule 1. My attention was not drawn to, and I am unable to find, any provision in the lease of the premises relating to equipment and fit out. However, the Applicant put into evidence the Disclosure Statement and, forming part thereof, is a “Plant & Equipment Schedule”. This Schedule sets out various unremarkable items included in the kitchen, the rear kitchen, an area described as “downstairs”, a “level 1 office (fronting Oxford Street)” a “level 1 office reception area”, a “level 1 middle office” and a “level 1 rear office”.

21 Quite frankly, I am unable to draw any conclusion from that Schedule and no submission was made to me that I should draw any conclusion from it.

22 It is important at this point to make this clear observation: both parties informed me that all evidence had been led that went to the issue of jurisdiction. I specifically drew the attention of the Respondent to the fact that at least one Directions hearing he made reference to an assertion that the premises in lettable area were 1000 sqm or more (section 5) and therefore excluded from the provisions of the Retail Leases Act; I specifically noted at the hearing on jurisdiction that no assertion was made to that effect; and I record that the Respondent did not make any assertion, although so invited by me, that the premises in lettable area offended the terms of section 5. Consequently, it must follow that the parties conceded, the Respondent in particular, that the lettable area of the premises were less than 1000 sqm – in those circumstances the Schedule attached to the Disclosure Statement did not seem to me to take the issue any further.

23 Indeed, this is particularly so because by Development Application determined 27 November 2001 Woollahra Municipal Council granted an application for “alterations and additions to existing commercial building (at 262 Oxford Street, Bondi Junction (the premises)) change of use from shop to commercial kitchen/takeaway food outlet and conversion of second level into (1) bedroom unit”. So, whatever may have been the terms of the Schedule, the position (by consent) changed. Condition 24 of the consent specified hours of operation of the “commercial kitchen … take away food outlet … (and) offices on first floor”. By letter 23 October 2003 Waverley Council modified condition 24 by limiting the hours of operation of all three aspects of the operation to 6-00am to 12-00am Monday to Sunday. Delivery times were also varied. It would appear that the Applicant traded from the premises under the name “Simmone Logue Fine Foods Bondi Junction”.

24 There was, at it turns out, precious little by way of direct evidence from the Respondent (in addition to that referred to in [17] above) relating to the operations of the Applicant from the premises. In oral evidence Mr Buttrose said that there were on the premises “dough making machines” and that Ms Logue had told him that they were making 10,000 pies per week; that she was “running a catering business” and that the “catering business was doing well”.

25 The primary evidence on the part of the Respondent was as follows: firstly, the Respondent relied upon various website descriptions of “Simmone Logue Fine Foods” and an article that appeared in the Sydney Morning Herald 26 October 2004. There is no need for me to trawl through those various documents. In some cases there is no reference to the leased premises; in other cases there is reference to the leased premises. In one website the operation is described as offering, “freshly cooked home styled meals available each day. We provide our customers with fresh, delicious healthy food made with care and skill. We are the original comfort food providores … we can cater a complete meal or provide the essential course to compliment the meal. We are rightly known as the pudding and cake experts. Corporate and event catering has been a natural progression from our origins in home catering services. Our menus are extensive and cater for all tastes and price ranges …”.

26 In another website the business is described as offering “innovating, fresh, and inspirational seasonal food for every wedding, from a small dinner to a banquet”. In another “Simmone Logue Fine Food has extensive experience catering for all kinds of events specialising in tailor-made events – from elegant receptions to cocktail parties. Simmone Logue has a range of scrumptious menus to suit your taste and budget. No matter the size or location, they have the attention to detail and professional service to ensure your event is a success. Visit their website to view menus, cakes and further information”.

27 It is difficult to conclude from all of these documents, which are drawn from various websites (and often not complete from those websites), what precise business was being conducted by the Applicant from the premises. Curiously, the Respondent did not seek to put into evidence anything at all from the Applicant’s own website, although there were many references to it in the material. It will be remembered that the Applicant operates a number of shops/businesses from various locations. I shall deal with these in more detail below, commencing at [33]. One of the websites describes the Applicant’s head office as the demised premises (262 Oxford Street, Bondi Junction) but that clearly only refers to the office functions. The head office is said to be closed on Saturday and Sunday and only open from 9-00am to 5-00pm on other days. Another website describes premises at 349 Darling Street, Balmain (the Balmain shop) and states “the team at Balmain turn out a fresh dinner menu every day. Its hearty home style food, ready to go. We also sell beautiful cakes, delicious baguettes and quiches, robust pies and succulent salads”.

28 The Applicant also relied upon an article that appeared in the Sydney Morning Herald 26 October 2004. This article described the leased premises as a “smallest eaterier-cum-takeaway where the food is displayed in a glass counter” but the article does not take the issue further, even if it could be relied upon, simply because it clearly only describes the takeaway portion of the premises. If anything, it goes to support an argument that the premises are premises within Schedule 1.

29 The primary arguments advanced by the Respondent relied upon the documents filed by the Applicant. I shall now consider those.

30 The first document is the Application for Original Decision filed 24 September 2007. This describes the premises as situate within “a multi-level building” comprising a shop floor on the lower lever and office premises on the top level. It then pleads that the premises were leased to the Applicant “for the purposes of operating a catering business”. The Respondent took great care to emphasise that statement. Nextly, the Respondent led in evidence the affidavit of Ms Logue sworn 26 November 2007. In that affidavit, at paragraph 4, she deposed that the Applicant leased the premises from the Respondent “for the purposes of operating a catering business”. Again, the Respondent put great store in that statement.

31 Thirdly, the Respondent relied upon, and tendered, the affidavit of Ms Logue sworn 4 September 2008. Not only did the Respondent tender this affidavit but did not require its deponent for cross-examination – this is important observation (upon which I shall expand below) because the Applicant also tendered the affidavit and relied upon it, such that it became an exhibit tendered by both parties. It is always dangerous to tender, or seek to call evidence from, one’s opponent. This is a classic example. In her affidavit, paragraph 4, Ms Logue corrects paragraph 4 of her previous affidavit 26 November 2007. It is appropriate to quote her correction in full:

“4. In paragraph 4 of my previous affidavit I refer to the applicant’s lease from the respondent of shop 1 and level 1, 262 Oxford Street, Bondi Junction (“the premises”) for the purpose of operating a catering business. This statement is incorrect. The premises at Bondi Junction were not leased for the purposes of a catering business at all. Those premises were for the purpose of making baking and patisseries items in addition to the production of food and beverages for sale in the retail shopfront at those premises. The catering business of Simmone Logue Fine Foods was operated out of the applicant’s Balmain premises”.

32 In my view in all the circumstances and both parties tendering/relying upon it that unchallenged sworn evidence must be accepted.

The Applicant’s Business

33 Ms Logue’s affidavit, relied upon by both parties, goes on in detail to describe her own personal background. She deposes to commencing business in about 1992, with the “baking of cakes at home … for retail sale”. After a short period she opened “a wholesale business, baking and selling cakes to the wholesale market from a small butchery shop in Balmain”. In about 1995 she opened her “first retail shop at 349 Darling Street in Balmain” (the Balmain shop) and moved her bakery from the Balmain butchery shop to that location. There she “baked cakes and pastry items for the retail and wholesale market.” The business grew and she started to produce what she called “my “home meal therapy” from this shop. “This included the production of food items such as lasagne and salads for my retail customers”.

34 In about 1996 she opened a retail shop at 470 Oxford Street Paddington (the Paddington shop). Later that year or the next year she opened a restaurant in Balmain, but sold that restaurant in about 2002 “to focus on the baking of my gourmet pies and generally to focus on building my business of baking and selling bakery products for the wholesale market and retail market”.

35 Her evidence that in about 1997 she moved into a kitchen at 59 Birrell Street Bondi Junction (the Bondi Junction shop) “to bake my gourmet pies”. She traded under the name “Simmone Logue Pies”. She continued to bake cakes at the Balmain shop. And in early 2003 she opened a retail shop at 2 Cross Street Double Bay (the Double Bay shop), a “retail business with its own kitchen and chef”.

36 Her evidence is that in “early 2003 she wished to consolidate the bakery of all the gourmet pies, cakes and pastry items into one location”. She said she “wanted all the bakery and pastry items under one roof”. Her intention was “to move the baking of the cakes from the Balmain shop and the baking of the pies from (the Bondi Junction shop) into one location. I also wanted a retail shop front to sell bakery items baked from that shop”. As a consequence of “a search for a suitable premises” she found the demised premises at 262 Oxford Street Bondi Junction.

37 Her evidence was that it “presented a large kitchen for the bakery and also opportunities for a better retail shopfront to that of (the) Paddington shop”. She wanted to develop brand awareness of the “Simmone Logue – Fine Food Company” and increase exposure to the main road in the retail strip of Oxford Street, Bondi Junction. She closed the Paddington shop “with the intention that (demised premises) would envelop that business”. The location of the premises “was paramount to my decision to select those premises. It had a good kitchen to accommodate all the bakery activities but it also presented a unique retail opportunity and also an opportunity to develop brand awareness. It was located in front of a bus stop and presented opportunities for marketing and signage displays to increase brand awareness”.

38 The Applicant opened the premises in December 2003, the lease having commenced 27 October 2003. From these premises Ms Logue states that she “operated a café and takeaway premises at which you could buy coffee, sandwiches and other bakery items which were produced on the premises including such items as our popular selling gourmet pies, chocolate fudge cake, croissants and other baked “items”. She estimated the quantity of coffee sold from the café and takeaway area (which she described as “the retail shopfront”) to be about 12 kilos of coffee per week. She then says that all “the pastry items sold from the retail shopfront were made from scratch on the premises. From the raw materials such as flour, sugar, chocolate and butter were transformed into the finished goods which were sold through my premises at Double Bay, Elizabeth Bay (as to which shop see [42] below) and Balmain. I baked pastry and pastry items at those premises for distribution to my other shops at Double Bay, Elizabeth Bay and Balmain. It was a very labour-intensive process and I had a staff of about 12 people at those premises from the shopfront to the back. Everything was made from hand. I employed mixers, bakers to bake the cakes, personnel to ice the cakes, pastry chefs to make the pastry for the pies and to make the fillings for the pies. This was all done on (the premises). I also employed at those premises packers to pack the items for delivery to other premises and wholesale clients. For the retail shopfront alone I employed two chefs, a couple of staff members in the shop and a kitchen hand day and night. I would estimate that during the week I would bake at least 5,000 pies a week and 400 ten inch cakes from (the premises).”

39 Upstairs she “operated a small administrative office from the first floor”.

40 She then gave detailed evidence about the other shops. In relation to the Balmain shop her evidence was that it “operated as a bakery with a retail shopfront which included a café, its own kitchen and its own kitchen staff including a chef”. This shop “brought bakery items such as my gourmet pies from (the premises).” Importantly, her evidence was that since opening the Balmain shop she “had requests to cater for customers. This catering business developed. All catering activities for the “Simmone Logue Fine Foods” business were carried out at the Balmain shop because these premises were the original premises and included a large kitchen, a large cool rooms and also a loading dock which was suitable for the catering business. There were always a couple of chefs or catering assistants in this kitchen for the catering business alone”.

41 With regard to the Double Bay shop this was “a retail shop front which included a café and a kitchen with its own chef. (The Double Bay shop) purchased bakery items from the (premises shop) which included gourmet pies, cakes and quiches”. The Double Bay shop “did not operate a catering business. This was solely undertaken at the Balmain shop. Any catering requests made at the Double Bay shop were directed to the Balmain shop, made at Balmain with the produced goods then delivered from Balmain to (the) Double Bay shop and/or the other premises. These goods were transported using a small fleet of Hiace vans to transport the catering items and also some Citroen support vehicles for smaller deliveries”.

42 The Elizabeth Bay shop was opened in 2004 “had a retail shop front which included a kitchen and its own chef and kitchen staff. This shop also purchased its bakery items from the Bondi Junction shop including the gourmet pies, cakes and quiches”.

43 In response to the affidavit evidence of the Respondent Ms Logue denied that she operated “a commercial kitchen for the manufacturing and wholesaling of foods and to operate a catering business” from the premises. She said, “this is simply not true. I operated a bakery with a retail shopfront and a small office upstairs. I did not operate my catering business from the Bondi Junction shop. I made food for the retail shopfront, which had a breakfast lunch and dinner menu. I made food also for takeaway sales. I also baked gourmet pies, cakes and quiches and other bakery items for the retail shop as well as for my three other shops at that time. I also baked those items for sale to wholesale customers”. She denied she told the Respondent, or did in fact, bake 10,000 pies per week at the premises, but rather agreed she baked approximately 5,000 pies per week” from the premises. She denied that she “operated a catering business from (the premises). (She said she had) only operated a catering business from my Balmain shop”.

Evidence from Applicant

44 As stated above the Applicant also relied upon the affidavit of Ms Logue 4 September 2008 (referred to above). There is no need to repeat that material.

45 In addition, the Applicant led evidence from a Mr Peter Grimes. Like Ms Logue, Mr Grimes was not called and not cross-examined. He is a director of Alors Holdings Pty Limited, a company which in April 2006 acquired an interest in the business activities previously undertaken by the Applicant.

46 His evidence was that in March 2008 he “commenced a due diligence process on the operations and business activities of the Applicant. This included site visits to the premises at 262 Oxford Street … Bondi Junction”. He said he was “familiar with the activities of the Applicant”. From his observations from the business of the Applicant at the premises he saw: “bakery activities including the baking of Simmone Logue’s gourmet pies, sausage rolls, savoury tarts, muffins, cakes and puddings for distribution to Simmone Logue Fine Foods shops at Double Bay, Elizabeth Bay and Balmain and also so Simmone Logue’s wholesale customers; food production for sale in the café/take away outlet at the front of the premises; the sale of food and beverages including coffee, teas and non-alcoholic beverages, snacks, bread, speciality and fast food take-away in the café/take-away outlet at the front of the premises; and an administrative office.”

47 His evidence went further. He stated that from his observations of the premises and the Balmain shop that “the Simmone Logue Catering Business was operated out of the Balmain shop and not the (premises) shop…. That (the premises) supplied Logue’s gourmet pies, sausage rolls, savoury tarts, muffins, cakes and puddings to those other Simmone Logue locations in addition to other wholesale customers”. He said that he was aware that “each” of the various Simmone Logue locations ‘employed a full kitchen staff and conducted fully operating kitchens and prepared all food necessary to supply customers, other than for the supply of Logue’s gourmet pies, sausage rolls, savoury tarts, muffins, cakes and puddings”.

48 It is important to observe yet again that neither Ms Logue nor Mr Grimes were called or cross-examined.

49 The Respondent put great weight upon the fact that Ms Logue “had a staff of about 12 people” at the premises and that for the retail shopfront alone, she “employed 2 chefs and couple of staff members in the shop and a kitchen hand day and night.” The Respondent submitted that I should therefore conclude that, by mathematical deduction, and deducting 5 from 12, there must have been a staff of about 7 at the back of the shopfront carrying out catering activities. I confess I am unable to make that deductive leap.

Tribunal’s Reasoning

50 It is important to make two observations: firstly the principle that “he who asserts must prove” must apply – in other words, the onus is on the Respondent to satisfy the Tribunal that the business being carried out at the premises was not a business defined or encompassed by Schedule 1; secondly, there was, in my view, a paucity of first-hand observation evidence of the business at the premises led by the Respondent.

51 Rather, the primary evidence was that of the Applicant (through its director Ms Logue) and Mr Grimes.

52 The next observation is this: I was informed that the definition of “bakery” in the New Shorter Oxford English Dictionary is “a place where baked products are made or sold”. The Respondent presented to me a print-out from the website of “Bakers Delight” and somehow submitted that I should be guided by that print-out so that when looking at a bakery one is somehow limited by what is produced by “Bakers Delight” (i.e. bread). I am, quite frankly, unable to adopt that logic. Many things can be the subject of a bakery. Not only bread, but also pies, cakes, sausage rolls and so on. In common parlance a bakery includes more than simply bread. Even the old children’s rhyme “pat-a-cake, pat-a-cake, baker’s man, bake me a cake as fast as you can” has some relevance simply because one can bake a cake. One also bakes a pie.

53 The Respondent, however, put his case somewhat differently, I think. His primary submission was that somehow, even if I accepted his evidence in its entirety and ignored the primary evidence from the Applicant, that a “catering business” somehow excluded a bakery, and because “catering” was not a business recognised by Schedule 1 therefore, the Applicant itself having described its business as a “catering business” then I am bound to hold that it was not a “bakery”. Firstly, there is nothing in the lease that would indicate the use of the premises. Secondly, a “catering business” does not of itself exclude it being a bakery. A bakery may well form the whole, or part, or the substantial portion, of a catering business. One needs to look at the actual use to which the premises were put at the relevant time. It is plain to me, overwhelmingly on the evidence, that whether or not the Applicant operated a catering business, the fact is that the premises in question were being used as a bakery and as a take-away shop. The use of the administrative office upstairs was certainly minor.

54 I clearly conclude that the evidence demonstrates that Ms Logue had a catering business but that it was not conducted from the premises.

55 Retail Leases Act Section 3 relevantly defines “retail shop” as being “premises that: (a) are used or proposed to be used, wholly or predominately for the carrying on of one or more of the businesses prescribed for the purposes of this paragraph …”. It is relevant to firstly observe that as part of the lease negotiations and the ultimate signing of the lease contract a Disclosure Statement was prepared, submitted and signed by the parties to the lease. A Disclosure Statement is a creature of the Retail Leases Act. It would not be unreasonable to therefore infer that at the time of signing the lease contract the parties acknowledged that the premises were a “retail shop” within the meaning of the Retail Leases Act and the lease was a “retail shop lease” within the meaning of that Act as defined in section 3.

56 The businesses prescribed for the purposes of the definition of “retail shop” are those set out in Schedule 1 to the Act. There are, so it seems to me, a number of prescribed businesses that may, on the evidence, fall within Schedule 1; namely bakeries or bread shops, cake shops, coffee, tea and other non-alcoholic beverage shops, takeaway food shops. For my part the evidence seems to point towards, “bakeries or bread shops” and “takeaway food shops”. I am content to find that the premises were used for the carrying out of a bakery and/or a takeaway food shop. There is nothing in the Act that prohibits a bakery business operating from a retail shop, and which is not in breach of Section 5, to sell its product to other shops or clients. Section 3, coupled with Section 5, simply defines appropriate premises by reference to the relevant lettable area and the businesses carried on. There is nothing that requires the product of the business being carried on at the shop premises being sold exclusively to retail customers coming to the shop.

57 I therefore find that the Tribunal has jurisdiction to hear and determine the issues between the parties. Declaration accordingly.

58 For the reasons stated above this Judgment is a final Judgment on the question of jurisdiction but always subject to any right of appeal. Absent any successful appeal the Judgment is final, the Tribunal has jurisdiction and the issue/assertions raised in the Application for Original Decision 24 September 2007 must now be dealt with.

59 The matter should now proceed in the usual and orderly fashion. The parties should file any additional affidavits upon which they would seek to rely on the issues raised in the pleadings. I propose that the matter come back before me for further directions with a view to adopting a timetable for the completion of pleadings/affidavit evidence.

60 The Applicant has sought Interim Orders by formal Application filed 5 September 2008 and the Applicant has also made it clear that it applies for costs of these proceedings. The Orders that I propose below will protect those additional aspects.

Orders:

1. Declaration that the Tribunal has jurisdiction to hear and determine the Application for Original Decision filed 24 September 2007.

2. The Application for Declaration filed by the Respondent 22 August 2008 is dismissed.

3. The Application for Interim Orders filed by the Applicant 5 September 2008 is adjourned for further directions.

4. Costs are reserved.

5. The proceedings are listed for further Directions before me on 6 November 2008.