D.B. Rreef Funds Management Ltd & P.T. Ltd v Valentino Home Fashion Pty Ltd; Valentino Home Fashion Pty Ltd v Westfield Hurstville (Westfield Management)
[2008] NSWADT 332
•12 December 2008
CITATION: D.B. Rreef Funds Management Ltd & P.T. Ltd v Valentino Home Fashion Pty Ltd; Valentino Home Fashion Pty Ltd v Westfield Hurstville (Westfield Management) [2008] NSWADT 332 DIVISION: Retail Leases Division PARTIES: APPLICANT
RESPONDENT
D.B. Rreef Funds Management Ltd & P.T. Ltd (075192)
Valentino Home Fashion Pty Ltd (075225)
Valentino Home Fashion Pty Ltd (075192)
Westfield Hurstville (Westfield Management) (075225)FILE NUMBER: 075192; 075225 HEARING DATES: 7 October 2008 SUBMISSIONS CLOSED: 7 October 2008
DATE OF DECISION:
12 December 2008BEFORE: Callaghan P, SC, Deputy President; Griffiths G - Non-Judicial Member ; Harrison B - Non-Judicial Member CATCHWORDS: Retail lease – Application for summary termination – Pre-lease misrepresentation – Estoppel – Time for commencement of proceedings – Mediation – Statements made in course of mediation – Evidence of damage – Unconscionable conduct – Serious allegations – Case management LEGISLATION CITED: Administrative Decisions Tribunal Act 1997
Civil Procedure Act 2005
Evidence Act 1995
Retail Leases Act 1994
Trade Practices Act 1974 (Cth)CASES CITED: AG v World Best Holding Ltd (2005) 63 NSWLR 557
Al Mousawy v JA Bryant Pty Ltd [2008] NSWSC 264
Alessa Pty Ltd v Total & Universal Pty Ltd [2002] NSWADTAP 16
Armstrong Jones Management Pty Ltd v Saies-Bond & Associates Pty Ltd [2007] NSWADTAP 47
Bischof v Werncog Pty Ltd [2004] NSWADT 241
Briginshaw v Briginshaw (1938) 60 CLR 336
Davies v Lyndhurst Developments Pty Ltd [2000] NSWADT 196
Dykes & Wyldie v Heatherway Pty Ltd [2007] NSWADTAP 26
FAI General Insurance Co. Ltd v Southern Cross Exploration N.L. (1988) 165 CLR 268
Gain v CBA (1997) 42 NSWLR 252
General Steel Industries Inc. v Commissioner for Railways (1964) 112 CLR 125
Gizah Pty Ltd v AXA Trustees Ltd [2001] NSWADT 116Heatherway Pty Ltd v Sykes & Wyldie [2006] NSWADT 354
Lifestyle Vehicles Pty Ltd v Minchinbury Pty Ltd [2008] NSWADT 195
Manly City Council v Malouf (2004) 61 NSWLR 394
Nam v Commonwealth Fund Management Ltd [2002] NSWADT 80
Placer (Granny Smith) Pty Ltd v Thiess Contractors Pty Ltd (2003) ALJR 768
Re Pochi & Minister (1979) 26 ALR 247
R v War Pensions Entitlement Tribunal ex parte Bott (1933) 50 CLR 228
Samaha v Corbett Court Pty Ltd [2006] NSWSC 1441
Sheldon v McBeath (1993) Aust Torts Reports 81-209
Wardley Australia Ltd v Western Australia (1992) 175 CLR 514
Winnote Pty Ltd v Page (2006) 68 NSWLR 531REPRESENTATION: APPLICANT (075192)
R Angyal SCAPPLICANT (075225)
C Kelly, agentRESPONDENT (075192)
RESPONDENT (075225)
C Kelly, agent
R Angyal SCORDERS: 1. Notice of Motion filed 9 July 2008 dismissed
2. Costs in respect of that Notice of Motion reserved
3. Proceedings are to be listed for a further Directions Hearing on Thursday, 18 December 2008 at 9:45 a.m.
SECTION Background Proceedings Motion Ground 1 Order 1 Order 2 Order 3 Order 4 Ground 2 Order 5 Order 6 Order 7 Order 8 Ground 3 Order 9 Ground 4 Order 10 Order 11 Order 12 Order 13 Conclusions Decision and Orders
REASONS FOR DECISION
Background
1 In late 2002 Valentino Home Fashion Pty Ltd (hereinafter called “the Lessee”) was involved in negotiations concerning a lease of Shops 135, 137 and 139 at Westfield Hurstville. Those negotiations included a written offer dated 21 November 2002 from Westfield Ltd to the Lessee outlining a proposed 5 years lease at a basic annual rent of $190,000.00, and Lessor and Lessee Disclosure Statements executed in December 2002 on behalf of SAS Trustee Corporation and P.T. Ltd as Lessor and the Lessee. They culminated in such a lease being entered into between those parties in respect of those premises specifying a commencement date of 10 March 2003, an expiry date of 9 March 2008 and a permitted use of “the retail sale of homewares, furniture and associated decor items…”.
2 After an occupancy of the premises commencing in about April 2003 the Lessee ceased to trade from, and vacated, the premises in June 2007.
3 By application bearing dated 31 May 2007 the Lessee sought mediation through the Retail Tenancy Unit in respect of disputes arising out of the lease. The Registrar, Retail Tenancy Disputes issued a certificate bearing dated 20 August 2007 that the mediation had failed to resolve the disputes.
Proceedings
4 By Application filed on 16 October 2007 (proceedings 075192) D.B. Rreef Funds Management Ltd and P.T. Ltd (“the Lessor”) sought relief which under an Amended Application filed on 7 April 2008, is for orders that the Lessee pay to the Lessor the sum of $123,593.94 together with interest, that amount comprising rent and outgoings to the termination date, rent and outgoings from the termination date to the date of a new lease entered into by the Lessor in respect of the premises, a short fall in rent for the balance of the term of the lease and “make good costs”. It has not been explained in this hearing how D.B. Rreef Funds Management Ltd succeeded to the interest of SAS Trustee Corporation in the lease and it should also be noted that the Application 075225 names the respondent as “Westfield Hurstville (Westfield Management)” and also as “Westfield Management Ltd”; nevertheless, it appears not to be in issue that the Lessor may be taken for all relevant purposes to be, and to have been, the applicants in the first Application and the respondents in the second Application.
5 The Lessee lodged an Application on 4 December 2007 (proceedings 075225) including some 40 odd pages of closely printed attachments which recite many matters of asserted fact and argument in respect of four claims under the Retail Leases Act 1994 (“RL Act”). Those claims, for present purposes, might be summarised, somewhat drastically but hopefully not unfairly, as comprising allegations (and claims for orders) concerning first, pre-lease misrepresentations in respect of advice by the Lessor to the Lessee that the benchmark average sales per square metre for homewares at Hurstville was $6,000; secondly, unconscionable conduct in connection with the lease, comprising principally non-disclosure by the Lessor to the Lessee of matters pertinent to price discrimination in rents and secret rebates in outgoings; thirdly, overcharging by the Lessors to the Lessee in respect of management and administration costs; and fourthly, misapplication by the Lessors of contributions by the Lessee to a promotional fund.
6 At a directions hearing on 31 January 2008, a timetable was stipulated for both proceedings by consent:
“1. Order the Applicant in proceedings 075192 to file and serve evidence in chief in support of its Application by 29/02/08.
2. Order the Applicant in proceedings 075225 to file and serve evidence in chief in support of its Application by 29/02/08.
3. Order the Respondent in proceedings 075192 to serve evidence in response by 04/04/08.
4. Order the Respondent in proceedings 075225 to serve evidence in response by 04/04/08.
5. Direct that the proceeding by listed for a direction hearing on 10/04/08 at 10.30 am.”
7 The Lessee filed in proceedings 075225 around late February 2008, evidence comprising 4 affidavits and these were later supplemented by another 2 affidavits.
Motion
8 The Lessor filed an amended Application and an Affidavit in proceedings 075192 on 7 April 2008 but filed no material in proceedings 075225. Evidently following statements of intention made on its behalf at intervening directions hearings, the Lessor, on 9 July 2008, filed a Notice of Motion seeking, essentially, the summary termination in its favour of proceedings 075225. The Lessee has filed some seven separate Responses to the Notice of Motion, involving in all, about 160 pages of closely printed, and copied, material. In the Notice of Motion there are several references to “Westfield Chatswood”; the subject proceedings relate to, as I have explained, Westfield Hurstville, and Westfield Chatswood seems to have no connection with them; I have read those references to “Westfield Chatswood” as being to “Westfield Hurstville” and when I reproduce some of them below I will do so with corresponding amendments.
9 The Motion was heard before me on 7 October 2008 when, on account of the unconscionable conduct aspect of the Lessee’s claim and in accordance with clause 4 of Division 3 of Part 3B of Schedule 2 to the Administrative Decisions Tribunal Act 1997 (“the ADT Act”), I was assisted by two non-judicial members (Messrs Griffiths and Harrison) who have acted in an advisory capacity only and have not adjudicated on the Motion. The assistance given by those members has been significant and I am most grateful to have had it but the decisions herein are mine alone.
10 At the hearing Mr R.S. Angyal S.C. appeared for the Lessor. Mr Craig Kelly, a director of the Lessee, appeared for the Lessee (with my permission and without dissent on behalf of the Lessors), he having indicated that the Lessee did not wish to have legal assistance.
11 The Notice of Motion seeks some 13 orders, four each in respect of each of the Lessee’s Grounds for Application Nos 1, 2 and 4 in the Application in proceedings 075225 and one in respect of Ground for Application No.3. I will deal in turn with each Ground for Application in the Application (and I will refer to them as “Ground 1” and so on) and the Orders sought in respect of it in the Notice of Motion. Before dealing with the Grounds separately, I note a few matters of general relevance to the whole Motion.
12 Mr Angyal has accepted that the onus on the Lessor in seeking to sustain the Motion is significant. In particular, first, he acknowledged that the Lessee’s evidence should be taken at its highest and to that end, he tendered all the affidavits filed by the Lessee; and secondly, he agreed with the relevance of the well-known General Steel decision (General Steel Industries Inc. v Commissioner for Railways (1964) 112 CLR 125) where, among other things, Barwick CJ said at 128-9:
“The plaintiff rightly points out that the jurisdiction summarily to terminate an action is to be sparingly employed and is not to be used except in a clear case where the Court is satisfied that it has the requisite material and the necessary assistance from the parties to reach a definite and certain conclusion. I have examined the case law on the subject…
It is sufficient for me to say that these cases uniformly adhere to the view that the plaintiff ought not to be denied access to the customary tribunal which deals with actions of the kind he brings, unless his lack of a cause of action – if that be the ground on which the court is invited, as in this case, to exercise its powers of summary dismissal – is clearly demonstrated. The test to be applied has been variously expressed; ‘so obviously untenable that it can not possibly succeed’; ‘manifestly groundless’; ‘so manifestly faulty that it does not admit of argument’; ‘discloses a case which the Court is satisfied cannot succeed’; ‘under no possibility can there be a good cause of action’; ‘be manifest that to allow them’ (the pleadings) ‘to stand would involve useless expense’.
At times the test has been put as high as saying that the case must be so plain and obvious that the court can say at once that the statement of claim, even if proved, cannot succeed; or ‘so manifest on the view of the pleadings, merely reading through them, that it is a case that does not admit of reasonable argument’; ‘so to speak apparent at a glance’.”
13 Mr Kelly has emphasised section 73 of the ADT Act, dealing with procedure of the Tribunal generally and including constraints such as:
“(2) The Tribunal is not bound by the rules of evidence and may inquire into and inform itself of any matter in such manner as it thinks fit, subject to the rules of natural justice.
(3) The Tribunal is to act with as little formality as the circumstances of the case permit and according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms.
(4) The Tribunal is to take such measures as are reasonably practicable:…
(c) to ensure that the parties have the fullest opportunity practicable to be heard or otherwise have their submissions considered in the proceedings.”
14 Mr Angyal has relied on section 73(5)(h) of the ADT Act which provides that the Tribunal:
“may dismiss at any stage proceedings before it if it considers the proceedings to be frivolous or vexatious or otherwise misconceived or lacking in substance”
15 Mr Kelly has also suggested, as I understand him, that the RL Act constitutes remedial legislation and as such should be interpreted liberally (and I note e.g. Pearce & Geddes, Statutory Interpretation in Australia 5th edition [9.2] to [9.6]). He cited remarks to that effect by the trial judge as quoted on appeal in Manly City Council v Malouf (2004) 61 NSWLR 394 at [49].
“His Honour then noted that the Retail Leases Act was ‘beneficial legislation’ and that, although it envisages the possibility of penalties, it should be given a broad construction. He therefore concluded in these terms (at [22]):
‘It seems to me that any ambiguity in the use of that term should be resolved in favour of giving the possibility of a remedy before a tribunal rather than to deny it, and accordingly I would uphold the submission that the tribunal does have appropriate jurisdiction to hear and determine on its merits the claim brought by Mr Malouf.’
It might be noted that in that case the trial judge’s decision was reversed in the appeal but there does appear to be some measure of approval in the passage quoted above of such an approach to construction of the RL Act (as seems to have been a view expressed in Lifestyle Vehicles Pty Ltd v Minchinbury Pty Ltd [2008] NSWADT 195 at [44] and [45]; see also Nam v Commonwealth Funds Management Ltd [2002] NSWADT 80 at [81]). Duncan, Commercial Leases in Australia 5th edition at p 84 speaks of the RL Act and corresponding Acts in other States as “the intrusion of the legislature into the retail lease regime” which “has caused considerable change to commercial leasing practices in the last two decades.” The RL Act may be appropriate to be classified as remedial legislation. Nevertheless, in my consideration of the Motion and in the formation of my decisions, I have not felt constrained to resort to any liberal interpretation of any particular provision of the RL Act.
Ground 1
Order 1
16 Order 1 sought in the Notice of Motion is that:
“An order with respect to the part of the Application headed ‘Grounds for Application (No.1)’ and the corresponding ‘Orders Sought (No.1)’ that the part be struck out as time-barred because it was lodged more than six months after entry into the retail shop lease.”
17 To sustain that order the Lessor submits principally (as summarised in Mr Angyal’s written submissions):
“In Armstrong Jones Management Pty Limited v Saies-Bond & Associates Pty Limited (RLD) [2007] NSWADTAP 47, the Appeal Panel of the Tribunal held at [123] that a section 10 claim is time-barred unless made within six months of entry into the lease.”
18 Paragraph 123 of the Armstrong Jones decision reads:
“The Importance of Section 11: In our view the provisions of Part 2 of the RL Act are intended to operate as a type of code. They aim to minimise the scope for confusion or future controversy. Section 11 is designed to place a bar on the taking of actions of a fundamental kind in relation to pre-lease representations. If the lessee does not move to terminate within the time allowed, the right to terminate is lost. In effect, the lease is affirmed. Consequently, we are inclined to the view that an estoppel (so far as remedies such as restitution or rescission are concerned) must arise once the 6 month period has passed. If no objection is taken by a lessee to the making of a pre-lease representation or in respect of an omission or other incompleteness in the disclosure statement within the 6 month period, a lessor is entitled to regard the lease as secure from attack over matters of that kind.”
I will deal further with that decision below but it might be noted at this stage that, read alone, this paragraph is not actually in the terms or perhaps even to the effect contended for by the Lessor as I have noted above.
19 Section 11 of the RL Act deals with a lessor’s written disclosure statement which must be given to the lessee at least 7 days before a retail shop lease is entered into. Sub-section (2) provides:
“If a lessee was not given a disclosure statement as required by subsection (1) or if the disclosure statement that was given to the lessee was incomplete or contained information that at the time it was given was materially false or misleading, the lessee may terminate the lease by notice in writing to the lessor at any time within 6 months after the lease was entered into, unless subsection (3) prevents termination.”
A lessee’s written disclosure statement is to be given not later than seven days after the lessor’s disclosure statement, under s11A.
20 Section 10 of the RL Act gives a right to compensation for pre-lease misrepresentations as follows:
“(1) A party to a retail shop lease is liable to pay another party to the lease (the injured party) reasonable compensation for damage suffered by the injured party that is attributable to the injured party’s entering into the lease as a result of a false or misleading statement or representation made by the party, or any person acting under the party’s authority, with knowledge that it was false or misleading.
(2) The giving of a lessor’s disclosure statement to a prospective lessee under a retail shop lease is considered to be the making of a representation by the lessor to the lessee as to the information in the disclosure statement.
(2A) The making of a representation by a prospective lessee in a lessee’s disclosure statement given to a prospective lessor under a retail shop lease that the prospective lessee has sought independent advice, or as to statements or representations relied on by the prospective lessee in entering the lease, is considered to be the making of a representation by a lessee to the lessor.
(3) This section extends to apply to a statement or representation made before the commencement of this section.”
21 The Armstrong Jones decision upheld a lessor’s appeal against a decision which had dismissed a retail tenancy claim by the lessor against the lessee and upheld a retail tenancy claim and an unconscionable conduct claim by the lessee against the lessor. The Tribunal at first instance had made a monetary order which had the effect of restoring the lessee to the position it was in prior to entry into the lease, by requiring the lessor to refund to the lessee the amount of the security bond plus interest. The lessee had been in occupation of the leased premises in a specialist ‘bulk-goods’ furniture centre for about 12 months before being locked out by the lessor. Having had the benefit of a four month rent-free period, the lessee thereafter paid no rent at all. Central to the Tribunal’s decision at first instance was a finding that:
“88. The Tribunal also finds that, in deciding to enter into the lease, Ms Bond relied on the statement or statements by Mr Draper that caused her to believe that Harvey Norman was a prospective tenant.”
22 On appeal, the Tribunal was not persuaded by challenges by the Appellant to the findings made by the Tribunal below concerning the representation, notwithstanding that the representation had not been noted in the lessee’s disclosure statement. At [121] of the appeal decision, the Tribunal said:
“In the present case there was, in our view, substantial evidence that Mr Draper had made the alleged representation, and that at the time of entering into the lease S-B had relied upon it. There were no similar findings in Samaha. An evidentiary presumption founded in the omission of the statement from the lessee disclosure statement can be overcome by contrary evidence; and was, we think, overcome in this case.”
The reference there to “S-B” is to the lessee and the reference to “Samaha” is to Samaha v Corbett Court Pty Ltd [2006] NSWSC 1441.
23 Samaha was decided after the Tribunal’s decision at first instance in Armstrong Jones and was relied on by the appellant lessor in the appeal. The circumstances which were before the Court in Samaha are conveniently summarised in paragraphs 106 and 107 of the Tribunal’s appeal decision in Armstrong Jones:
“Samaha dealt with a lessor’s claim similar to the present, and lessee cross claims similar to the present. The lessees had vacated the premises seven weeks into a lease without ever having paid any rent, after business turned out too much weaker than expected. The lessor reclaimed possession and re-let the premises. The lessor sued for its losses. The lessees counterclaimed alleging various misrepresentations by the letting agent. The lessees lodged a retail tenancy claim and an unconscionable conduct claim. The retail tenancy claim included a claim for damages under s52 of the Trade Practices Act. Their case failed. An order was made in favour of the lessor for unpaid rent and outgoings during the term of the lease, for damages for wrongful repudiation of the lease and for certain additional works by the lessor on behalf of the lessees.
The representations alleged against the agent in that case went to the following matters: whether the centre would be fully occupied or close to fully occupied on opening; the tenancy mix of the centre; whether a possible competitor who operated at a nearby shopping area would close down; whether the new centre would become the shopping ’hub’ of the region; and whether they might become ‘wealthy’ if they took up a lease in the new centre.”
The Court in Samaha found that none of the representations alleged against the lessor was made in the way or with the meaning suggested by the lessees and the Court also said that had it found that any of the alleged representations were made, it would not have found reliance by the lessees on it or them. The judgment in Samaha then dealt with an issue of estoppel:
“68 In case I am wrong in the foregoing conclusions, I shall state my conclusions on the contention by Corbett Court that, in any event, Mr and Mrs Samaha are estopped by the Lessee’s Disclosure Statement in now asserting that they relied upon any Representations in entering into the lease.
69 There is no dispute that Mr Corbett received the Lessee’s Disclosure Statement prior to his execution of the lease. There was no challenge to his evidence that he relied on it in entering into the lease: T 218.29-T 219.11. That evidence is inherently probable: if the Lessee’s Disclosure Statement had asserted reliance by Mr and Mrs Samaha on a representation that the centre would be fully let on opening and would contain a specified tenancy mix, a loud warning of risk of litigation would have sounded for Mr Corbett.
70 The Lessee’s Disclosure Statement, signed by Mr and Mrs Samaha and sent to Corbett Court after they had received the advice of their solicitor, was a clear and unequivocal representation to Corbett Court that there were no representations by it upon which Mr and Mrs Samaha were relying in entering into the lease. Corbett Court relied upon that representation in entering into the lease and thereby changed its position irrevocably.
71 Mr and Mrs Samaha are therefore estopped from departing from the representation in their Lessee’s Disclosure Statement.”
24 The Tribunal on appeal in Armstrong Jones said in culmination of its consideration of Samaha and estoppel:
“118 We do not share the Tribunal’s view … that the lessee’s disclosure statement obligations can be read down so as to exclude from the exchange process a representation as to a major anchor tenant. The lessor’s disclosure statement obligations are wide ranging, and cover, as we see it, many matters to do with the overall operation of the shopping centre. The many warnings to which we have referred, found both in Part 1 and in the body of Part 2 … are all designed, we think, to implant firmly in the minds of the parties the importance of transparency as to all maters of material significance to each party. In this regard, we agree with the approach adopted by Palmer J. in Samaha.
119 In our view, lessees should see the disclosure statement regime as providing the place in which to record all material representations that induced them to enter the contract.
120 Similarly, lessors should actively set out in the disclosure statement the representations which they have made in the course of negotiations and perceive as going to material matters. So far as the lessor is concerned, it is self-evident we think that any representation as to the identity of a major anchor tenant, however conditionally expressed, is of major importance to prospective small tenants. It is not sufficient, we think, for lessors simply to use the blank space under the heading ‘details of agreements and representations’ to list the agreements which they have procured which favour them, and ignore the representations they made to secure the deal (as occurred here). It is not fair to leave it entirely up to the lessee to identify the representations that have been made.
121 In the present case, there was, in our view, substantial evidence that Mr Draper had made the alleged representation, and that at the time of entering into the lease S-B had relied upon it. There were no similar findings in Samaha. An evidentiary presumption founded in the omission of the statement from the lessee disclosure statement can be overcome by contrary evidence; and was, we think, overcome in this case.
122 As we read Palmer J’s reasons, his Honour would raise an estoppel once the allegedly material representation is not disclosed by the lessee in the disclosure statement. We are not inclined to go that far. The factors referred to by Duncan may be such that a lessee can be forgiven for not noting down all relevant representations in the lessee disclosure statement. The failure to live up to a representation may only become apparent on entry into occupation. A lessee should not be barred by an omission at the disclosure statement stage from taking action on a pre-lease representation that was important but not included in the disclosure statement. But we accept that at some point an estoppel may arise.”
25 The decision on appeal in Armstrong Jones continued as follows after paragraph 123 which I have quoted in par 18 above:
“124 We can find no reference in the evidence filed by S-B to any expression of concern over the ‘Harvey Norman’ representation in the immediate period after S-B moved in. Yet Ms Bond must have known once Joyce Mayne set up in the space, that Harvey Norman was not a tenant. Along with many other concerns, the issue is first raised in a letter written from S-B’s then solicitors (Veliks) in August 2005. At this point Ms Bond had been in occupation for almost a year, and she was seeking to resist AJM’s notice of termination.
125 Ms Bond had taken no steps within the six month period to seek to terminate the lease for non-disclosure. She could have kept alive a claim for reasonable compensation for misrepresentation in respect of the Harvey Norman representation had she raised the matter. But she did not raise that matter, either, within the six months.
126 In our view, the appeal succeeds on the estoppel point.
127 Before examining the issues relating to relief and the duty to mitigate, may we observe that great care should be taken by lessors and lessees, and those advising them, in examining the terms of the lease and in properly completing the disclosure statements. The RL Act’s pre-lease disclosure provisions, and its requirements for ongoing provision of information, seek to minimise the possibility of misunderstanding between the parties and some of the problems that arose in this case. Commercial leases involve the making of substantial forward commitments on both sides. A retail shop lease will often expose the lessee to a financial burden that exceeds the price of a home. Lessees, in particular, should proceed with caution, and take care to obtain independent legal and financial advice.”
26 As is apparent, I suggest, by the above coverage and in particular when paragraph 123 is read in the context of the surrounding paragraphs in the decision, Armstrong Jones in applying the 6 months time limit in section 11 of the RL Act to a claim for compensation under section 10, did so on the basis of an estoppel which had been substantiated by the lessor on the facts of that case.
27 In the proceedings before me, some evidence can be located at a reasonably quick look, of a pre-lease representation as alleged by the Lessee and reliance by the Lessee on that representation (paragraphs 22-35 of the affidavit of Craig Robert Kelly sworn 25 February 2008 – “the principal Affidavit”), alleged falsity of that representation (eg paragraphs 36-78 of the principal Affidavit) and circumstances in which and the reasons why, the Lessee says it did not discover that falsity until about early 2007 (paragraphs 36-78 of the principal Affidavit). On the other hand, there is evidence against the Lessee constituted by parts of the disclosure statements in respect of the lease, tendered on behalf of the Lessor, particularly paragraph 5 and 6 in the Lessee’s disclosure statement:
“In entering into the retail shop lease, the lessee has relied on the following statements or representations made by the lessor or the lessor’s agents.
Note: Matters such as agreements or representations relating to exclusivity or limitations on competing uses, sales or customer traffic should be detailed.
(a) The matters set out under “Details as to Agreements or Representations” in the attached Part 1, Lessor’s Disclosure Statement.
Gratuitous payment of $100,000 payable in 7 days from commencement of trading as assistance with fit out by Westfield.
Apart from the statements or misrepresentations set out above, no other promises, representations, warranties or undertakings (other than those contained in the lease) have been made by the lessor to the lessee in respect of the premises or the business to be carried out on the premises.”
(Note: The wording about gratuitous payment was inserted in handwriting into the printed form).
The contents of that statement by the Lessee may constitute a platform (particularly in light of Samaha and Armstrong Jones) for a defence of estoppel to be mounted by the Lessor.
28 What weight or significance is to be attributed to the evidentiary material that I have referred to in the previous paragraph (and the rest of the evidence) is not a matter to be further assessed, let alone decided on, in an application of the sort that is before me. There are issues to be determined relating to the 6 months time limit referred to in Order 1 sought in the Notice of Motion and they should, in my opinion, go to trial. The terms of Order 1 understate the breadth of those issues. The issues do not involve a situation within section 73 (5)(h) of the ADT Act or any other summary termination situation and do not warrant the Order sought.
29 I add that Mr Kelly has referred to a number of decisions in his submissions. In respect of Order 1, he relied on Davies v Lyndhurst Developments Pty Ltd [2000] NSWADT 196 and Gizah Pty Ltd v AXA Trustees Ltd [2001] NSWADT 116. Particularly taking account of the subsequent cases of Samaha and Armstrong Jones, I have found no direct assistance in those two decisions and I do not see the need to deal with them further. Hereafter, I will refer to any decision which Mr Kelly has raised only if I have found it to be of direct assistance.
Order 2
30 Order 2 sought in the Notice of Motion is that:
“In the alternative to order 1, an order with respect to the part of the Application headed ‘Grounds for Application (No.1)’ and the corresponding ‘Orders Sought (No.1)’ that the part be struck out as time-barred because it was lodged more than three years after the liability that is the subject of the claim arose.”
31 Section 71 of the RL Act provides that a retail tenancy claim may not be lodged with the Tribunal more than 3 years after the liability or obligation that is the subject of the claim arose. S71B was added to the Act by the Retail Leases Amendment Act 2005 and provides that the Tribunal may extend this period to 6 years if the Tribunal is satisfied that it is “just and reasonable” to do so. S71B commenced on 1 January 2006 and clause 34 of Schedule 3 of the RL Act provides “s 71B as inserted by the 2005 Amending Act extends to a liability or obligation that arose, or conduct that occurred, before the commencement of that section”.
32 The question of any section 71B extension of time raises significant considerations. The Lessor has submitted in respect of any application by the Lessee for such an extension of time:
“The application should be rejected, for the reason that, on the Applicant’s pleading, it was aware from entry into the lease that it was suffering losses by reason of entry into the lease. On its pleading, it made no complaint to the Respondents until May 2007 (paragraph 78) and took no formal step towards a remedy until June 2007, when it requested a mediation. This was more than four years after entry into the lease.”
33 Against that contention, there is other material before the Tribunal seeking to explain why the Lessee waited until 2007 before seeking relief (eg paragraphs 36-78 of the principal Affidavit).
34 I did not detect Mr Angyal on behalf of the Lessor to contest that (if this were an appropriate case) the Tribunal could grant an extension of time in favour of the lessee under section 71B or that such an extension could be granted on a nunc pro tunc basis. The jurisdiction to grant such an extension would be exercised if it were in terms of section 71B(3)(c) “just and reasonable” to do so, and such a situation has otherwise been described as “where, in all the circumstances, justice is served best by doing so” (Halsbury’s Laws of Australia [255-380]). What may be an appropriate outcome for an application for a section 71B extension of time is an issue which was not squarely raised or fully prosecuted before me and it will require consideration either on a separate application by the Lessee seeking such an indulgence or perhaps in the course of an ultimate hearing of these proceedings. It is not an issue appropriate to be decided on in an application of the sort that is before me; see also Wardley Australia Ltd v Western Australia (1992) 175 CLR 514 at 533 quoted in paragraph 39 below.
35 There are, in my opinion, further reasons why Order 2 sought by the Lessor before me, may not be appropriate. First, I feel that there is an issue warranting consideration at a trial in respect of the time at which any relevant liability or obligation arose.
36 Mr Angyal on behalf of the Lessor contends, as he put in his written submissions:
“The Applicant pleads in paragraphs 31 and 32:
‘31 This representation of the average benchmark being $6000 for Homewares at Westfield Hurstville was therefore relied upon and was a significant inducing factor in VHF entering the lease at a starting rent of $815 per m2 p.a.
32 Without this representation, VHF would have sought a rent similar to what it has [sic: was] paying per m2 at Warringah Mall, or it would not have entered into the lease at all.’
It follows from this pleading that, on the Applicant’s case, it suffered loss as soon as it entered into the lease – because at that point, it became obliged to pay a higher rent that it would have paid had it not entered into the lease in reliance on the misrepresentation. It follows that the Applicant’s cause of action accrued on entry into the lease and the Respondents (on the Applicant’s case) at that point became liable to the Applicant.
Further on its pleading, the Applicant suffered losses from entry into the lease:
’39 However VHF was [sic: has] never been able to achieve anything remotely close to the benchmark average claimed by Mr Engeman of $6000 per m2.
40 Paying a substantially higher rent at Westfield Hurstville, than its other premises, VHF at Hurstville operated at unsustainable occupancy costs, and its business incurred heavy losses month after month from day one.” (emphasis added)’
For this reason also, the Applicant’s cause of action accrued on entry into the lease or shortly afterwards.”
37 I am not persuaded that the time of accrual of the liability or obligation should be said necessarily to be on or shortly after entry into the lease. The Lessee contends, as I understand it, that it did not appreciate until about early 2007 that its continuing failure to perform adequately, in terms of financial results, in the subject premises, was, at it now alleges, attributable to the alleged pre-lease misrepresentation. From the Lessee’s point of view, it might be contended that the Lessor’s liability or obligation arose on a continuing basis during the whole period after entering into the lease, separately on each day thereafter. This sort of consideration was raised in different but somewhat materially similar factual contexts in Bischof v Werncog Pty Ltd [2004] NSWADT 241 at [85]-[87], and Heatherway Pty Ltd v Dykes & Wildie [2006] NSWADT 354 at [121] to [125] (note that the treatment of the latter decision on appeal appears not to have affected the paragraphs cited: Dykes & Wildie v Heatherway Pty Ltd [2007] NSWADTAP 26). There can also be somewhat similar considerations concerning continuing contractual and tortious duties giving rise to successive breaches: Sheldon v McBeath (1993) Aust Torts Reports 81-209 and Winnote Pty Ltd v Page (2006) 68 NSWLR 531.
38 Secondly, there is a line of authority in relation to claims under the Trade Practices Act 1974 (Cth) which may suggest that some relevant deferment of the time of accrual of the claim for compensation might be appropriate here. This line of authority stems principally from the judgment of Mason CJ and Dawson, Gaudron and McHugh JJ in Wardley Australia Ltd v Western Australia (1992) 175 CLR 514 at 527:
“When a plaintiff is induced by a misrepresentation to enter into an agreement which is, or proves to be, to his or her disadvantage, the plaintiff sustains a detriment in a general sense on entry into the agreement. That is because the agreement subjects the plaintiff to obligations and liabilities which exceed the value or worth of the rights and benefits which it confers upon the plaintiff. But, as will appear shortly, detriment in this general sense has not universally been equated with the legal concept of ‘loss or damage’. And that is just as well. In many instances the disadvantageous character or effect of the agreement cannot be ascertained until some future date when its impact upon events as they unfold becomes known or apparent and, by then, the relevant limitation period may have expired. To compel a plaintiff to institute proceedings before the existence of his or her loss is ascertained or ascertainable would be unjust…”
39 Wardley also has relevance to what I have said above in relation to any section 71B extension of time in this case as it emphasises the inappropriateness of such a question being determined on an interlocutory basis. The case concerned a pleading amendment that had been struck out on the grounds that it pleaded a cause of action which was outside the three year time limit then prescribed by section 82 of the Trade Practices Act. That decision was reversed on appeal and the appeal decision was affirmed in the High Court. The joint judgment which I have referred to said at 533:
“We should, however, state in the plainest of terms that we regard it as undesirable that limitation questions of the kind under consideration should be decided in interlocutory proceedings in advance of the hearing of the action, except in the clearest of cases. Generally speaking, in such proceedings, insufficient is known of the damage sustained by the plaintiff and of the circumstances in which it was sustained to justify a confident answer to the question…”
40 I express no concluded view on those matters which I have raised beyond saying that they too constitute reasons for the view that I have formed that Order 2 does not involve a section 73(5)(h) or any other summary termination situation and is not appropriate to be made on this Motion.
Order 3
41 Order 3 sought in the Motion by the Lessor in respect of Ground 1 in the Lessee’s Application seeks:
“In the alternative to orders 1 and 2, an order with respect to the part of the Application headed ‘Grounds for Application (No.1)’ and the corresponding ‘Orders Sought (No.1)’ that the part be struck out as failing to state a retail tenancy claim because the applicant did not, in entering into the retail shop lease, rely on a pre-lease misrepresentation with respect to sales per square metre for homewares at Westfield Hurstville.
Particulars
3.1 In paragraphs 5 and 7 of its Application for Mediation of a Retail Tenancy Dispute filed on 6 June 2007, File No. RTU 00131/2007, the applicant admitted that, in entering into the retail shop lease, it did not rely on a pre-lease misrepresentation with respect to sales per square metre for homewares at Westfield Hurstville.
3.2 Alternatively or in addition to paragraph 3.1, in paragraph 28 of its Application, the applicant admitted that, in entering into the retail shop lease, it did not rely on a pre-lease misrepresentation with respect to sales per square metre for homewares at Westfield Hurstville.
3.3 Alternatively or in addition to paragraphs 3.1 and 3.2, in paragraph 5 of its Lessee’s Disclosure Statement dated 9 December 2002, the applicant represented to the respondent, pursuant to section 10(2A) of the Retail Leases Act 1994, that, in entering into the retail shop lease, it had not relied on a representation by the respondent with respect to sales per square metre for homewares at Westfield Hurstville.”
42 I will deal with Particulars 2 and 3 first. Particular 1 raises a special issue of confidentiality or privilege as it deals with a document, the Application for Mediation, having some association with a mediation. Having queried its admissibility, I eventually accepted Mr Angyal’s tender of the document “subject to objection” (the objection was basically my own) and I will have to rule on the admissibility question.
43 Particular 2 asserts that in paragraph 28 of the Lessee’s Application the Lessee admitted that “it did not rely on a pre-lease misrepresentation with respect to sales per square metre for homewares at Westfield Hurstville.” Paragraph 28 is one of five paragraphs under a heading “The $6000 benchmark average for Homewares – an inducing fact or to enter into the lease.”
“28 The Managers of VHF certainly understood the benchmark for Homewares of $6000 as advised by Mr Engerman was no guarantee that VHF would achieve this benchmark at Westfield Hurstville.
29 However having observed the other Homewares retailers in Westfield Hurstville, that would be VHF competitors – and other Homewares retailers located in other regional shopping centres, the management of VHF were confident that their business model would eventually match the competition and achieve this benchmark average, and could possibly exceed the average, if they outperformed the competition.
30 The representation gave VHF the impression that it had the potential to achieve this benchmark (and possibly higher) if it marched its competitors, and it gave it the impression that the asking rent was justified.
31 This representation of the average benchmark being $6000 for Homewares at Westfield Hurstville was therefore relied upon and was a significant inducing factor in VHF entering the lease at a starting rent of $815 per m2 p.a.
32 Without this representation, VHF would have sought a rent similar to what it has been paying per m2 at Warringah Mall, or it would not have entered into the lease at all.”
44 When paragraph 28 is read in the context in which it appears, particularly with the heading which immediately precedes it and with paragraphs 31 and 32, it would seem that, contrary to the Lessor’s contention, the Lessee may be asserting there that it did rely on a misrepresentation concerning the benchmark. The construction of that material and the weight to be given to it raise a sufficient issue, in my opinion, for it to be not to be appropriate to be dealt with further in an application of the sort that is before me.
45 In Particular 3 the Lessor relies on the Lessee’s Disclosure Statement to which I have referred to above in relation to Order 2 sought by the Lessor in relation to the Lessee’s Application. As I have noted there, the subject of misrepresentation is not referred to in the Lessee’s Disclosure Statement, and as I have said in paragraph 27, the contents of that statement may constitute a platform for a defence of estoppel to be mounted by the Lessor. Subject to that, the Lessee’s Disclosure Statement constitutes another piece of evidence to be considered (like the other matters referred to in the other particulars to Order 3 in the Notice of Motion) together with the rest of the evidence. Again, as I have said in paragraph 28, what weight or significance is to be attributed to such evidentiary material is not a matter to be further assessed, let alone decided on, in an application of the sort that is before me.
46 In Particular 1 in respect of Order 3 which it seeks in the Notice of Motion, the Lessor asserts that in paragraphs 5 and 7 of the Application for Mediation which the Lessee lodged with the Retail Tenancy Unit on 6 June 2007 “that, in entering into the retail shop lease, it did not rely on a pre-lease misrepresentation with respect to sales per square metre for homewares at Westfield Hurstville”.
47 Division 2, sections 63-69, of Part 8 Dispute Resolution, of the RL Act mandates participation in a mediation process before proceedings can be taken in respect of a retail tenancy dispute. Such a mediation occurred in this case, and as I have noted, the Registrar, Retail Tenancy Disputes certified on 20 August 2007 that the mediation had failed to resolve the dispute between the Lessor and the Lessee in respect of the subject premises. Section 69 makes statements made in the course of a mediation inadmissible in subsequent proceedings:
“Any statement or admission made in the course of the mediation of a retail tenancy dispute or other dispute or matter referred to in section 65(1) (a1) pursuant to arrangements made by the Registrar under this Part is not admissible at a hearing of a claim under Division 3 or in any other legal proceeding.”
There is an expanded definition of “mediation” in section 67:
“mediation is not limited to formal mediation procedures and includes the following:
(a) preliminary assistance in dispute resolution, such as the giving of advice designed to ensure that the parties are fully aware of their rights and obligations and that there is full and open communication between the parties concerning the dispute,
(b) other appropriate forms of alternative dispute resolution.”
48 The RL Act provisions concerning mediation referred to above are not as extensive as those in sections 99-111 of the ADT Act dealing with Tribunal ordered mediations (and neutral evaluations) and in particular sections 107 and 108 of the ADT Act are extensive provisions relating to Privilege and Secrecy respectively. See also sections 25-34 of the Civil Procedure Act 2005 and Uniform Civil Procedure Rules 20.1-20.7 relating to Court ordered mediations. Section 125 of the ADT Act dealing with privileged documents and the Evidence Act 1995 might also be noted. Privilege and confidentiality are features also of consensual mediations and mediation agreements traditionally contain provisions detailing those features. Against that sort of background I had an instinctive reaction against accepting the Application for Mediation in evidence. Nevertheless, in some situations evidence may be given of matters associated with mediations (apart, of course, from proceedings to enforce a compromise agreement made at mediation). For example, in Al Mousawy v J A Byatt Pty Ltd [2008] NSWSC 264 the Court admitted evidence of written communications by one party refusing to participate in a mediation which had been arranged. The Court acknowledged the provisions in the Uniform Civil Procedure Act 2004 relating to privilege and said at [17]:
“The purpose of such provisions is clear. As Gleeson CJ said in Gain & Anor v Commonwealth Bank of Australia & Anor (1997) 42 NSWLR 252 at 256 in relation to the same wording:
‘The reason for such legislative provision is obvious. It is the policy of the legislation that parties should be encouraged to discuss their differences without the risk that things they say might later be used against them, in court, if the mediation does not result in settlement.’”
Explaining why it admitted the communications into evidence, the Court said at [21]:
“The facsimile and email, however, were not prepared for use in the mediation or in any preparatory stage leading up to the mediation. The documents are the very antithesis of the sort of documents which the section is designed to protect from disclosure and which were described in Gain. These documents relate to the cancellation of a mediation session. They are at most collateral or incidental to it but do not gain the protection afforded by section 30 (4).”
Another example is Alessa Pty Ltd v Total and Universal Pty Ltd [2002] NSWADTAP 16 where evidence had been received of advice by an officer of the Retail Tenancy Unit to a party prior to the mediation (evidently not of the sort covered by section 67 of the RL Act).
49 In the case before me, in the Application for Mediation, in response to the questions within the form “What is the dispute about?” and “What do you hope to achieve from mediation?” the Lessee attached four closely printed pages of details. These go beyond the identification of matters for the purpose of answering the questions and set out, in some detail, contentions and complaints by the Lessee against the Lessor. As such, this material should, I think, be viewed as not just part of a document formally starting the mediation process but also as the presentation of matters for the purposes of the mediation. It therefore comprises, in my opinion “statement(s) or admission(s) made in the course of the mediation” and as such is rendered inadmissible by section 69. Particular 3 fails, in my opinion, for that reason alone.
50 Nevertheless, during submissions the Application for Mediation was referred to by the Lessee as well as the Lessor and on that account and, perhaps more importantly, in case I am wrong as to the non-admissibility of the document and also to present an indication of the nature of the contents of the attachment to the Application for Mediation, I will deal with paragraph 5 and 7 of that attachment relied on by the Lessor in Particular 1 in respect of Order 3 which it seeks in the Notice of Motion. To do so I set out not only paragraphs 5 and 7 but paragraphs 3 to 7 inclusive:
“3. The specific conduct was in relation to a pre-lease representation made by Mr Engerman to Mr Lawrence Kelly and Mr Phillip Kelly, managers of VHF, and in reply to this direct question Mr Engerman claimed that the;
‘Average sales per m2 for Homewares for Westfield Hurstville is $6000’.
4. This was ‘statement of fact’ that VHF relied upon, and was used as a benchmark for its cash flow projections and budgeting estimates to determine if the rent offered by Westfield would make the business viable.
5. Relying upon Mr Engerman’s statement of fact, the management of Valentino closely inspected the existing Homeware stores at Hurstville, and the traffic flow of the centre, and specifically past the offered location, and believed that they would be able to achieve this benchmark of the average of Homeware sales of $6000 per m2 p.a.
6. The size of the shop considered to be leased by VHF was 233.2 m2. If the average sales for Homeware’s per m2 as advised by Mr Engerman of $6000 were achieved – the business would have annual turnover of $1,399,200.
7. However, the management of VHF used the information as provided by Mr Engerman, budgeted on achieving sales 35% below this figure. This would have amounted to annual sales of approximately $900,000 – and therefore the annual rent of $190,000 offered by Mr Engerman on behalf of Westfield – would have made the Homewares business a viable proposition.”
When paragraphs 5 and 7 are read in the above context, particularly in conjunction with paragraph 4, it appears that, contrary to the Lessor’s contention, the Lessee may be asserting there that it did rely on a misrepresentation concerning the benchmark. The construction of those paragraphs and the weight to be given to them (if they be admissible) raise a sufficient issue, in my opinion, for them (in any event) not to be appropriate to be dealt with further in an application of the sort that is before me.
51 For these various reasons, in my opinion, Order 3 does not involve a section 73(5)(h) or any other summary termination situation and is not appropriate to be made on this Motion.
Order 4
52 Order 4 specified in the Notice of Motion is:
“In the alternative to orders 1-3, an order for summary judgment with respect to the part of the Application headed ‘Grounds for Application (No.1)’ and the corresponding ‘Orders Sought (No.1)’ on the ground that there is no evidence that the applicant has suffered loss by reason of a pre-lease misrepresentation with respect to sales per square metre for homewares at Westfield Chatswood.
Particulars
4.1 On 31 January 2008, the Tribunal ordered the applicant, by 29 February 2008, to file and serve the evidence in chief in support of the Application.
4.2 The applicant has not served any evidence that it has suffered loss by reason of a pre-lease misrepresentation with respect to sales per square metre for homewares at Westfield Chatswood.”
53 The Lessor submits, as put in Mr Angyal’s written submissions, that the Lessee “has not served any evidence that it has suffered loss by reason of pre-lease misrepresentation with respect to sales per square metre for homewares at Westfield Hurstville” and that “in the absence of evidence of loss, the (Lessee) does not have a cause of action under section 10(1)”. It further submits that the Lessee as indicated in its Response to Notice of Motion filed 31 July 2008 (“the principal Response to the Notice of Motion”) at p 23 paragraph 9 that it “has commissioned an expert’s Reports from its Accountant to detail the monetary loss it incurred resulting from the alleged misrepresentation” and the Lessor says that “this is an admission that, without explanation, it has not completed its evidence in chief with respect to Ground (1) despite being ordered to file and serve by 28 February, seven months ago.”
54 It is in some respects a difficult task to determine clearly what is contained within the somewhat voluminous material which the Lessee has filed. Nevertheless, as an example of what is there, there is a contention to the effect that the Lessee claims, among other things, that the rent which it was paying was to some extent too high and should to that extent be refunded by the Lessor to it. That contention appears in numerous places e.g. in par.32 of its Application (in proceedings 075225) quoted in par.43 above; in Order 1 in the Orders Sought section of its Grounds for Application No.1; in the eight paragraphs preceding par.9 in the principal Response to Notice of Motion (referred to by the Lessor in its submissions); and perhaps in parts of the principal Affidavit such as within paragraphs 47-63. There thus appears reasonably clearly as a matter of articulation, if not evidentiary substantiation, a way in which the Lessor says that it has suffered some loss.
55 As well as evidence from its Accountant, the Lessee seeks to rely on material yet to be produced in response to Summonses which are yet to be issued and any evidence which the Lessor may file (despite the Lessor’s non-compliance to date with the Orders of 31 January 2008).
56 I understand that the Lessee is thus seeking indulgence from the Tribunal to permit it to get its evidentiary case in better order. To obtain any such indulgence it would be appropriate for the Lessee to make some explicit application to the Tribunal. I express no opinion on the merits or prospects of any such application but I do not see that, in the present circumstances, the Lessee should be denied an opportunity to make it. I do note, however, that even a self-executing order (which the 31 January 2008 Order about the Lessee’s evidence, is not) may, under current authority, be extended or otherwise overcome by subsequent order (FAI General Insurance Co. Ltd v Southern Cross Exploration N.L. (1988) 165 CLR 268; and note rule 43 of the Administrative Decisions Tribunal (Interim) Rules 1998, dealing with extensions of time).
57 In these circumstances, I do not see that Order 4 involves a section 73(5)(h) or any other summary termination situation. In my opinion, it is not appropriate to be made on this Motion.
58 There may be other relevant considerations arising in respect of Order 4. First, there is the somewhat notorious difficulty sometimes of adducing precise evidence of what a party claiming damages has lost and in certain cases it may be that estimation, if not guess work, may be necessary in assessing the damages to be allowed; see e.g. Placer (Granny Smith) Pty Ltd v Thiess Contractors Pty Ltd [2003] HCA 10, (2003) 77 ALJR 768, per Hayne J at [37] and [38], albeit in the context of breach of contract. Secondly, the powers of the Tribunal relating to retail tenancy claims are very wide e.g. under section 72(1)(a) the Tribunal may make:
“an order that a party to the proceedings pay money to a person specified in the order, whether by way of debt, damages or restitution, or refund of any money paid by a specified person.”
Thirdly, there are the broad provisions of section 73 of the ADT Act which I have quoted in paragraph 13 above; nevertheless, that part of section 73(2) stipulating that the Tribunal is not bound by the rules of evidence has to read with some qualification: see e.g. re Pochi & Minister for Immigration and Ethnic Affairs (1979) 26 ALR 247 at 256-7 per Brennan J - the Tribunal must have before it material having logical or rational probity or force and justice may nevertheless require attention to the rules of evidence, as Evatt J in R v War Pensions Entitlement Appeal Tribunal; ex parte Bott (1933) 50 CLR 228 at 256 pointed out:
“Some stress has been laid by the present respondents upon the provision that the Tribunal is not, in the hearing of appeals, ‘bound by any rules of evidence.’ Neither it is. But this does not mean that all rules of evidence may be ignored as of no account. After all, they represent the attempt made, through many generations, to evolve a method of inquiry best calculated to prevent error and elicit truth. No tribunal can, without grave danger of injustice, set them on one side and resort to methods of inquiry which necessarily advantage one party and necessarily disadvantage the opposing party. In other words, although rules of evidence, as such, do not bind; every attempt must be made to administer ‘substantial justice’.”
59 The matters just canvassed were not agitated to any significant degree before me. Beyond saying that they reinforce my view that Order 4 does not involve a section 73(5)(h) or any other summary termination situation and is not appropriate to be made on this Motion, I express no further opinion in relation to them.
Ground 2
Order 5
60 I have summarised in par 5 above, as I said, somewhat drastically but hopefully not unfairly, the Lessee’s Ground 2 in its Application as comprising:
“unconscionable conduct in connection with the lease, comprising principally non-disclosure by the Lessor to the Lessee on matters pertinent principally to price discrimination in rents and secret rebates in outgoings”.
61 Order 5 is expressed in the Notice of Motion as:
“5 An order with respect to the part of the Application headed ‘Grounds for Application (No.2)’ and the corresponding ‘Orders Sought (No.2)’ that the part be struck out as time-barred because it was lodged more than three years after the alleged unconscionable conduct occurred.
Particulars
The alleged unconscionable conduct occurred at the time of entry into the retail shop lease in April 2003. The Application was lodged on 4 December 2007.”
62 To support Order 5 the Lessor submits, quoting Mr Angyal’s written submissions:
“37 An unconscionable conduct claim may not be lodged more than three years after the alleged unconscionable conduct occurred: section 71A(2). The alleged unconscionable conduct occurred at the time of entry into the retail shop lease in April 2003. The Application was lodged on 4 December 2007.
38 Further, in Armstrong Jones, the Appeal Panel held at [143]-[146] that a lessee who fails to raise an unconscionable conduct claim based on pre-lease conduct is estopped if it fails to raise the claim within six months of entry into the lease.
39 The Appeal Panel said at [145]:
‘In our view, an adversely affected party should bring their concerns that they have been a victim of conduct that may be unconscionable promptly to the attention of the party asserted to be at fault, so as to give that party an early opportunity to rectify the situation.
Where there is unconscionable conduct, the victim of that conduct cannot sit on its hands, do nothing, continue to trade and effectively accept the situation; then, much later, but only when pressed to comply with its obligations under the lease, raise unconscionable conduct as a defence or cross-claim.’
The Respondents rely on this holding.
40 The Applicant does not dispute that its unconscionable conduct claim is out of time. It has responded that its time for filing the claim should be extended from three to six years under section 71B(2).
41 The holding of the Appeal Panel quoted above at paragraph 39 of these submissions disposes of that application. The application should be rejected, for the reason that, on the Applicant’s pleading, it was aware from entry into the lease that it was suffering losses by reason of entry into lease. On its pleading, it made no complaint to the Respondents until May 2007 (paragraph 78) and took no formal step towards a remedy until June 2007, when it requested a mediation. This was more than four years after entry into the lease.”
63 I have dealt with the Armstrong Jones decision in relation to Order 1 above. As the Lessor’s submissions which I have just quoted recognise, in paragraph 38 thereof, that decision dealt with the six months limitation period in section 11 of the RL Act and its relationship to a section 10 claim on the basis of estoppel. The quotation by the Lessor of [145] of that decision does not reflect the full context in which estoppel was being referred to by the Tribunal and [143]-[146] (to which the Lessor had referred) should be quoted in full:
“143 In this instance, we think that the considerations that give rise to an estoppel after 6 months in respect of termination of the lease, are also relevant to whether an unconscionable conduct claim should be upheld.
144 As we have already noted, the Harvey Norman representation was first raised as a complaint in the letter of S-B’s solicitors (Veliks) in August 2005. At this point S-B had been in occupation for almost a year.
145 In our view, an adversely affected party should bring their concerns that they have been a victim of conduct that may be unconscionable promptly to the attention of the party asserted to be at fault, so as to give that party an early opportunity to rectify the situation. Where there is unconscionable conduct, the victim of that conduct cannot sit on its hands, do nothing, continue to trade and effectively accept the situation; then, much later, but only when pressed to comply with its obligations under the lease, raise unconscionable conduct as a defence or cross-claim.
146 For similar reasons to those given in respect of the s10 claim, our view is that S-B is estopped in respect of this ground of complaint. As it was the only ground upon which the unconscionability claim succeeded, the Tribunal’s finding should be set aside.”
When these remarks are read as a whole, it is clear, in my opinion, that the Tribunal was referring to an estoppel which had been substantiated by the Lessor in that case on the facts of that case. As I have said in paragraphs 27 and 28 above, there may be in the case which is before me, evidence which may constitute a platform for a defence of estoppel to be mounted by the Lessor, but the weight or significance that is to be attributed to that evidence, and the rest of the evidence, is not a matter to be further assessed, let alone decided on, in an application of the sort that is before me; and while there are issues to be determined relating to the six months time limit, they should, in my opinion, go to trial.
64 In paragraphs 31-34 above, I dealt with the issue of any extension of time under section 71B of the RL Act in the context of the retail tenancy claim made by the Lessee in Ground 1. Similar provisions and considerations relate to the unconscionable conduct claim made by the Lessee in Ground 2. In this case also, the Lessor submits that any section 71B extension of time should be rejected. For the same reasons that I endeavoured to express in those paragraphs above in relation to the Ground 1 situation, I am of the same view in relation to the Ground 2 situation. What may be the appropriate outcome for a section 71B extension of time application in respect of the Lessee’s unconscionable conduct claim is an issue which was not squarely raised or fully prosecuted before me and it will require consideration either on a separate application by the Lessee seeking such an indulgence or perhaps in the course of an ultimate hearing of these proceedings. It is not an issue appropriate to be decided on in an application of the sort that is before me. Again, the Wardley decision, as referred to in paragraph 39 above, is relevant to this point.
65 For these various reasons, I am of the view that Order 4 does not involve a section 73(5)(h) or any other summary termination situation and is not appropriate to be made on this Motion.
Order 6
66 Order 6 is propounded in these terms in the Notice of Motion:
“6 In the alternative to order 5, an order that the part of the Application headed ‘Grounds for Application (No.2)’ and the corresponding ‘Orders Sought (No.2)’ that the part be struck out as failing to state an unconscionable conduct claim.
Particulars
6.1 The applicant alleges that the respondent failed to make full disclosure of intended conduct, namely that it would charge lower rents per square metre to large retailers than to the applicant.
6.2 The conduct concerned was not ‘intended conduct’ within the meaning of that term in section 62B(3)(i) because the respondent was engaging in the conduct at the time of entry into the retail shop lease.”
67 In support of this, the Lessor submits, as summarised in Mr Angyal’s written submissions:
“42 Section 62B(3)(i) refers to ‘intended conduct of the lessor that might affect the interests of the lessee’. The essence of the Applicant’s claim is the Respondents did not disclose that the rent per square metre the Applicant was obliged to pay under its lease was much higher than the Respondents were charging major retailers at Westfield Hurstville.
43 The Applicant knew what its rent per square metre was going to be; that appeared from the Disclosure Statement and from the lease itself. What the Respondents allegedly did not disclose what this rent was much higher than rents it was currently charging to major retailers at Westfield Hurstville.
44 Section 62B(3)(i) looks to the future. The reference in sub-paragraph (ii) to ‘risks to the lessee arising from the lessor’s intended conduct’ makes this clear. The conduct of which the Applicant complains cannot be ‘intended conduct’ because the conduct was taking place at the time that the Applicant entered into the lease.”
68 The Lessor has thus categorised the unconscionable conduct claim as being one of “intended conduct of the lessor that might affect the interests of the lessee” as referred to in section 62B(3)(i)(i). Whether the claim should be so restricted is not totally clear. In par 8 of the Particulars to Ground 2 in its Application the Lessee does say that it “places its first and main emphasis on the factor (i) as detailed in section 62B(3) for the Tribunal to consider in determining if the Respondent has engaged in Unconscionable Conduct”, and it is apparent by factor (i) it means sub-paragraph 62B(3)(i)(i). Nevertheless that paragraph in the Particulars follows a section in which the Lessee has recited seven other paragraphs of section 2B(3), emphasised that the list in that sub-section is non-exhaustive and requested that in addition to those matters, factors such as “harshness of the result” and “oppression suffered by the lessee” be taken into account as well; and paragraph 8 is then followed by a further 148 paragraphs of so-called particulars, which, while they are somewhat discursive, should not be disregarded.
69 Even if the categorisation of “intended conduct” were appropriate for the unconscionable conduct claim, the Lessee has argued that the characterisation of that conduct as current, not intended, conduct is inappropriate and submits (the principal Response to the Notice of Motion, in the section dealing with Order 6):
“(10) The Respondent had only engaged in the conduct of placing the Applicant at competitive disadvantage after the Applicant had entered into the lease, as at that time the Applicant had a monthly obligation and liability to pay rent and outgoings at substantially higher rate than its direct competitors at Westfield Hurstville Shoppingtown.
(11) Therefore immediately prior to the lease being entered into, the Respondent was not engaging in Price Discrimination against the Applicant, however immediately prior to the lease being entered into it was the ‘intended conduct’ of the Respondent to engage in Price Discrimination against the Applicant.
(12) Therefore as the Respondent was aware of its intention to place the Applicant at competitive disadvantage prior to the Applicant entering into the lease, such conduct is ‘intended conduct’ within the meaning of the term in section 62B(3)(i).”
70 Further, the Lessee has drawn attention to what was said in Armstrong Jones at [141]:
“In our view s62 requires, ultimately, an holistic examination of all the circumstances of the lease relationship.”
At the same time, in terms of guidance from previous cases concerning unconscionable conduct claims, there also should be borne in mind the high barrier which has to be passed to establish unconscionability. As Spigelman CJ said in AG v World Best Holdings Ltd (2005) 63 NSWLR 557 at [121]:
“Unconscionability is a concept which requires a high level of moral obloquy. If it were to be applied as if it were equivalent to what was ‘fair’ or ‘just’, it could transform commercial relationships in a manner which the Minister expressly stated was not the intention of the legislation. The principle of ‘unconscionability’ would not be a doctrine of occasional application, when the circumstances are highly unethical, it would be transformed into the first and easiest port of call when any dispute about a retail lease arises.”
71 Overall, the above considerations make it clear enough to my mind that there are issues concerning the unconscionable conduct claim which are wider than as suggested by the Lessor in Order 6 and which are not appropriate to be further assessed, let alone decided on, in an application of the sort that is before me. Order 6 does not involve a section 73(5)(h) or any other summary termination situation and is not appropriate to be made on the Motion.
Order 7
72 The Notice of Motion specifies Order 7 thus:
“7 In the alternative to order 6, an order that the part of the Application headed ‘Grounds for Application (No.2)’ and the corresponding ‘Orders Sought (No.2)’ that the part be struck out as failing to state an unconscionable conduct claim.
Particulars
The respondent did not within the meaning of section 62B(3)(i) of the Retail Leases Act 1994 ‘unreasonably fail to disclose’ its intended conduct because the applicant was aware from publically-available information that the respondent was charging lower rents per square metre to large retailers than to the applicant: See the evidence given by Mr Craig Kelly, a director of the applicant, to the Australian Competition and Consumer Commission’s Grocery Price Inquiry Hearing on 8 April 2008 at transcript page 128, lines 1-11.”
73 The Lessor submits that, quoting Mr Angyal’s written submissions, there are two reasons why the Lessee did not “unreasonably fail to disclose” intended conduct within the meaning of section 62B(3)(i):
“46 First, it is apparent from paragraphs 78-81 of the Application that the Applicant was aware that ‘a lessee occupying a smaller space would expect to pay a higher rent per m2 than a lessee occupying a larger space’. It cannot have been unreasonable not to disclose something to the Applicant that the Applicant already knew.
47 Second, the Applicant was aware from publicly available information that the Respondents were charging lower rents per square metre to large retailers than to small retailers such as the Applicant. Mr Craig Kelly, a director of the Applicant, gave evidence to the Australian Competition and Consumer Commissioner’s Grocery Price Inquiry Hearing on 8 April 2008 that:
‘For an independent retailer, he’s paying up to 1500 or more per square metre, so the independent is actually paying up to ten times more rent than the supermarkets are for the retail space.”
Transcript page 128, lines 6-8 (annexed to the Applicant’s Response to Notice of Motion). Again, it cannot have been unreasonable for the Respondents not to have disclosed something to the Applicant that the Applicant already knew.”
74 It may be that, through Mr Kelly, the Lessee accepts that generally rent rates for smaller spaces are higher than rent rates for larger spaces. Nevertheless, the gravamen of the Lessee’s complaint about rent discrimination appears to be to the effect that there was on this occasion rent discrimination by the Lessor against the Lessee of a different and greater order. For example, in paragraphs 31 to 35 in respect of Ground 2 in its Application, the Lessor alleges:
“31 The Applicant alleges that at the time it entered in the lease with the Respondent, that the Respondent’s intended conduct was to engage in Price Discrimination by charging the Applicant upwards of the 500% or more per square for the retail space the Applicant occupied to sell, by way of retail sale; Homewares, Furniture and associated décor items, compared to what the Respondent charged to other retailers for retail space in the Respondent shopping centre.
32 Price Discrimination of such a massive extent, resulting from the Respondent’s intended conduct, created a highly distorted competitive environment at the shopping centre of Westfield Hurstville, and the Respondent unreasonably failed to disclose this to the Applicant prior to the Applicant entering into a lease with the Respondent.
33 This Price Discrimination was exacerbated by the restrictions of the permitted usage clause under the lease. The Applicant was restricted to sell ‘Homewares, Furniture and Associated Décor’, while competitors of the Applicant (those that received the advantage of the Discriminations) did not have such restrictions and were able to sell other types of products in the shopping center.
34 Products such as clothing, footwear, cosmetics, fashion accessories, computers, electronics, can have upwards of a 200% higher sales per m2 than Furniture and Homewares, due to their somewhat bulky nature.
35 Therefore competitors of the Applicant that received advantages of the Discriminations, also received the additional benefits that as well as being able to us part of the leased premises to display ‘Homewares, Furniture and Associated Décor’ in competition with the Applicant, they could also use other parts of the leased premises to sell other items which have a substantially (100%-200%) greater dollar turnover per m2. This fact greatly increased the magnitude of the already extreme 500% Discrimination in rents and competitive disadvantage faced by the Applicant.”
75 Thus, the Lessee’s complaint may be a matter not just of new rates varying with areas leased. Accordingly, Order 7 does not appear to constitute a total and conclusive answer to the Lessee’s allegations. Order 7 does not involve a section 73(5)(h) or any other summary termination situation and is not appropriate to be made on the Motion.
Order 8
76 Order 8 is sought in the Notice of Motion in the following terms:
“8 In the alternative to orders 5 – 7, an order for summary judgment with respect to the part of the Application headed ‘Grounds for Application (No.2)’ and the corresponding ‘Orders Sought (No.2)’ on the ground that there is no evidence that the applicant has suffered a loss by reason of unconscionable conduct.
Particulars
8.1 On 31 January 2008, the Tribunal ordered the applicant, by 29 February 2008, to file and serve the evidence in chief in support of the Application.
8.2 The applicant has not served any evidence that it has suffered a loss by reason of unconscionable conduct.”
77 The Lessor puts it submissions in respect of Order 8 as summarised in Mr Angyal’s written submissions:
“51 The Applicant has not served any evidence that it has suffered loss by reason of unconscionable conduct by the Respondents.
52. On page 15, paragraph 4 of its Response to Notice of Motion, the Applicant says:
‘Although the Applicant filed evidence of the existence of undisclosed price discrimination, it will require further evidence to obtained by summons from the Respondent to further establish the full magnitude of the Price Discrimination, and until such summons is issued and returned, the Applicant is unable to quantify the loss and damage resulting from the Respondent’s alleged Unconscionable Conduct.”
52. On page 16, paragraph 12 of its Response to Notice of Motion, the Applicant says:
‘Additionally, once all the evidence is in supporting the Applicant’s Unconscionable Conduct claim, the Applicant will file and serve an expert’s report detailing the exact monetary loss it has incurred resulting from the Unconscionable Conduct that it has been a victim of.’
53 These statements constitute admissions by the Applicant that:
54.1 The Applicant does not know what loss it has suffered by reason of unconscionable conduct.
54.2 Without explanation, the Applicant has not taken the steps necessary to quantify its loss.
54.3 Without explanation, the Applicant has not taken the steps necessary to complete its evidence in chief with respect to Ground 2, which it was ordered to file and serve by 29 February 2008, seven months ago.”
78 The context of the Lessee’s remarks in the principal Response to the Notice of Motion quoted above should be taken into account. That may be sufficiently presented for present purposes if only paragraph 3 is quoted:
“(3) Likewise the Applicant has been forced (unknowingly) to pay substantially more to the Respondent for its rent & outgoings vis-a vis what was being paid by the Applicant’s direct competitors in the Westfield Hurstville Shoppingtown, (and hence the Applicant has been a victim of undisclosed Price Discrimination) then it is self-evident that the Applicant has suffered competitive injury and incurred loss & damage.”
79 As with the Ground 1, as dealt with above in relation to Order 4, there thus appears within the material which the Lessee has filed reasonably clearly as a matter of articulation, if not evidentiary substantiation, a way in which it says that it has suffered some loss. Matters which I have dealt with in relation to Order 4 in paragraphs 55, 56 and 58 above are relevant here also. I take them into account here but do not repeat them.
80 In these circumstances, I do not see that Order 8 involves a section 73(5)(h) or any other summary termination situation. In my opinion, it is not appropriate to be made on this Motion.
Ground 3
81 I have summarised Ground 3 above in paragraph 5 as “overcharging by the Lessors to the Lessee in respect of management and administration costs.” Ground 3 is expressed in this detail (with a couple of pages of particulars subscribed) in the Application (in proceedings 075225):
“2. Throughout the term of the lease the Respondent charged to the Applicant expenses for ‘Variable Outgoings’ which included ‘Management and Administrative Costs’.
3. It was represented by the Respondent, that these ‘Management and Administrative Costs’ were directly related to the operating expenses for Management and Administration for Westfield Hurstville.
4. The Applicant paid these ‘Management and Administrative Costs’ as part of the Variable Outgoings on a monthly basis throughout the term of the lease, based on this representation.
5. It is the Applicants view that the Management and Administrative Costs have been artificially inflated by the Respondent, and that the Respondent has overcharged the Applicant for these costs, which the Applicant has paid.
6. Under s 72 of the NSW Retail Leases act, the Applicant seeks the tribunal to make an order for a refund from the Respondent for the overcharge of ‘Management and Administrative Costs’ paid by the Applicant.”
Order 9
82 Order 9 is specified thus in the Notice of Motion:
“9 An order for summary judgment with respect to the part of the Application headed ‘Grounds for Application (No.3)’ and the corresponding ‘Orders Sought (No.3)’ on the ground that there is no evidence that the applicant has suffered loss by reason of an overcharge for outgoings.
Particulars
9.1 On 31 January 2008, the Tribunal ordered the applicant, by 29 February 2008, to file and serve the evidence in chief in support of the Application.
9.2 The applicant has not served any evidence that it has suffered loss by reason of an overcharge for outgoings.”
83 The Lessee refers in its particulars to figures in the United States published (evidently in 2006) by the Urban Land Institute and the International Council of Shopping Centres and its Supplementary Response to Notice of Motion No.1, to figures relating to regional shopping centres outgoings in 1999-2000 published by Queensland Lease Consultants. It is asserted by the Lessee that these figures provide support for its allegation of overcharging as made in Ground 3, explaining for example, in the Supplementary Response to Notice of Motion No.1:
“12 Attachment (SRNM#3) shows that despite Westfield Hurstville being close to the average size for Regional Shopping Centres throughout Australia, the ‘Management and Administration costs’ which the Respondent claims to have incurred are one of the highest for any regional shopping centre in Australia, and further, the Management and Administration costs claimed by the Respondent, are significantly higher than even much larger centres.
13 The Management and Administration costs for operating the Westfield Hurstville Shopping Centre, claimed to have been incurred by the Respondent are $589,472 higher p.a. than the Australian average, and $785,409 higher p.a. than the similar and nearby Bankstown Square centre.”
84 In its Application, the Lessee seeks a refund of 43% of the $43,000 in total which it says it paid to the Lessor on this account, which it calculates as $18,490 plus GST.
85 The Lessee is, again, seeking an opportunity to get further evidentiary material together. In this respect, considerations on which I have written in paragraphs 55, 56 and 58 above are relevant here also. I take them into account but do not repeat them.
86 In these circumstances, I do not see that Order 9 involves a section 73(5)(h) or any other summary termination situation. In my opinion, it is not appropriate to be made on this Motion.
Ground 4
87 The Lessee in its Application puts this claim thus:
“2. Throughout the term of the lease the Applicant paid to the Respondent a ‘Promotional Fund Contribution’ as per item 6 of the Lease.
3. It was represented by the Respondent, that this Promotional Fund Contribution would be used for the purpose of advertising, promotional and marketing activities for Westfield Hurstville.
4. This representation was false, and the Respondent has used the Promotional fund for purposes other than it represented to the Applicant.
5. Under s 72 of the NSW Retail Leases act, the Applicant seeks the tribunal to make an order for a refund from the Respondent for the full amounts paid by the Applicant into this promotional fund.”
88 In the particulars subscribed to Ground 4 and in its Fourth Supplementary Response to the Notice of Motion, the Lessee relies on a statement by the Lessor made in a written Submission dated 27 July 2007 “The Market for Retail Tenancy Leases in Australia” to the Productivity Commission Public Inquiry and also on the Receipts and Expenditure Statement for the financial year ended 30 June 2005 of the Westfield Promotion Fund. In the former document, the Lessee refers to this section:
“Direct financial support for retailers experiencing difficulties
In addition to the Retailer Relations Program providing professional assistance Westfield also provides, in special circumstances, rent relief (promotional allowance) to retailers experiencing difficulties.
In 2005, Westfield provided $7.5m worth of rent relief, and $7.6m in 2006. In 2007, Westfield has so far provided $3.5m.”
In the latter document the Lessee relies on an item “Promotions Support” in an amount of $3.134m. The Lessee asserts in its Application, with reference to the former document:
“6. It would appear by following the words ‘rent relief’ with the words in brackets ‘promotional allowance’ – that this so called rent relief is merely the Respondent making a multi-million raid and misappropriation of the Promotional fund to top up any short fall in rent when retailer experiences difficulty in paying the rent, because the rent is at an unsustainable level.
7. Given that the Applicant has contributed to the Promotional fund on the understanding that this fund would for ‘Promotion of the Shopping Town’, and instead a substantial proportion appears to have been used for other purposes, for the financial advantage of the Respondent, that Applicant has been misled as to the purposes of the fund, and the Applicant seeks a refund of all monies it has paid to the Respondent into this Promotional fund.”
Order 10
89 Order 10 seeks that Ground 4 “be struck out as time-barred because it was lodged more than six months after entry into the retail shop lease.” It relies on its particulars and submissions in respect of Order 1.
90 Applying here the considerations which I have set out in pars 17 to 28 above in respect of Order 1, I am of the view that Order 10 does not involve a section 73(5)(h) or any other summary termination situation and is not appropriate to be made on this Motion.
Order 11
91 This order seeks, in the alternative to Order 10, that Ground 4 “be struck out as time-barred because it was lodged more than 3 years after the liability that is the subject of the claim arose”. I understand the Lessor to rely in support of Order 10 on what it has put in respect of Order 2.
92 I am of the view that the considerations which I have canvassed in paragraphs 31 to 39 above in respect of Order 2 are relevant here also.
93 In these circumstances, I have formed the view that Order 11 does not involve a section 73(5)(h) or any other summary termination situation and is not appropriate to be made on this Motion.
Order 12
94 In the alternative to Orders 10 and 11, the Lessors seeks that Ground 4 “be struck out as failing to state a retail tenancy claim because the Applicant did not, in entering into the retail shop lease, rely on a pre-lease misrepresentation with respect to the use of Promotional Fund contributions”.
95 The Lessor in its particulars and submissions, relies on matters raised in respect of Order 3 above. The considerations which I have sought to cover in paragraphs 43 to 50 above in respect of Order 3 also apply here. In those circumstances, in my opinion, Order 12 does not involve a section 73(5)(h) or any other summary termination situation and is not appropriate to be made on this Motion.
Order 13
96 By Order 13 the Lessor seeks in the alternative to Orders 10 to 12 an order for summary judgment with respect to Ground 4 “on the grounds that there is no evidence that the Respondent represented falsely to the Applicant that it would use Promotional Fund contributions by the Applicant for advertising, promotional and marketing activities for Westfield Hurstville, or that the Applicant has suffered loss by reason of the representation”.
97 I have set out above in explaining Ground 4, the material on which the Lessee currently relies. I understand that the Lessee again seeks to put on other evidence relating to this Ground and what I have said above in pars 55, 56 and 58 is appropriate to be taken into account here also.
98 Again, in an application of the sort that is before me, it is not appropriate for me to deal with the weight of such evidentiary material that the Lessee may be relying on. Nevertheless, following a contention by Mr Angyal in his oral submissions, Mr Kelly accepted that if the Lessee’s allegations in respect of Ground 4 are not substantiated, they would be “scandalous”. The Lessee must appreciate that the serious nature of such allegations will require a high standard of proof: as Dixon J said in the oft-cited decision of Briginshaw v Briginshaw (1938) 60 CLR 336 at 362:
“But reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters ‘reasonable satisfaction’ should not be produced by inexact proofs, indefinite testimony, or indirect inferences.”
99 My overall assessment of Order 13 in these circumstances is that I do not see that it involves a section 73(5)(h) or any other summary termination situation. In my opinion, it is not appropriate to be made on this Motion.
Conclusions
100 I am thus of the view that none of the Orders sought by the Lessor in the Motion should be made and that the Motion fails. Nevertheless, it is clear that the positions which have been taken and which may be sought to be taken in these proceedings by the respective parties need to be brought under control. The Lessor’s Motion was not the appropriate vehicle for such a situation to be achieved and a timely directions hearing or a timely series of directions hearings is required. Other considerations apart, the Tribunal has a statutory obligation “to act as quickly as is practicable” (section 73(5)(o) of the ADT Act) and while the Civil Procedure Act 2008 may not apply to this Tribunal, the guiding principles specified there in sections 56-60 in Part 6 – Case Management and Interlocutory Matters are worthy of close consideration.
101 The Lessee must appreciate that applications which it has foreshadowed in material which it has lodged with the Tribunal, should be explicitly and promptly made and prosecuted, if that is the Lessee’s intention. For example, there are references there to extensions of time and to further evidence. Also, in its Supplementary Response to Notice of Motion No.3, the Lessee purports to “seek to amend” its application in respect of Grounds 1, 2 and 4 to rely on various other sections of the RL Act; that application, if it be such, was inappropriate to be dealt with on the Lessor’s Motion and was not agitated before me. I have to say also that the material which the Lessee has placed before the Tribunal fails in many parts to distinguish between matters of fact, matters of evidence and matters of argument and to meet the overall ideal of the presentation of material in concise and summary form. I commend to Mr Kelly and others involved in the control and management of the Lessee that before the next directions hearing, they give urgent and close consideration to the comments which I just made and those of a similar type that I have made in various other places in the course of the above Decision
Decision and Orders
1. The Lessor’s Notice of Motion filed 9 July 2008 in proceedings 075225 is dismissed
2. Costs in respect of that Notice of Motion are reserved
3. Proceedings are to be listed for a further Directions Hearing on Thursday, 18 December 2008 at 9:45 a.m.
6
25
5