Domino's Pizza Enterprises Limited v Seldex Pty Ltd

Domino's Pizza Enterprises Limited (Applicant) sought a declaration that it had validly exercised an option to renew a lease for premises in Brisbane, and that the renewal should proceed without a market rent review. Seldex Pty Ltd (Respondent) contested the validity of the notice of exercise of the option to renew, and argued that a market rent review was required before the renewal. The matter was heard in the Queensland District Court.

The central legal issues were whether the Applicant had validly exercised the option to renew the lease, and whether the Respondent was required to give prior notice of a market rent review before the Applicant exercised its option. A secondary issue was whether a late notice of market rent review could be considered valid. The court had to interpret the lease agreement, particularly the clauses relating to the option to renew and the market rent review.

The court found that the Applicant had indeed given a valid notice of its intention to exercise the option to renew the lease. The Respondent's failure to give prior notice of a market rent review did not invalidate the Applicant's exercise of the option. The court also held that the subsequent notice of market rent review was ineffective because it was issued after the option had been exercised. Consequently, the Applicant was entitled to a renewed lease without a market rent review.

The court ordered that the Applicant had validly exercised the option to renew, acquired an equitable leasehold interest for the option period, and was entitled to a registered lease as per the terms of the original lease. The court also fixed the rent for the first lease year at $60,534.46 plus GST.