Haoliang Sun & Golden Land Group Pty Ltd v Chinese Culture School Inc

The parties to this proceeding were Haoliang Sun and Golden Land Group Pty Ltd (the applicants) and Chinese Culture School Inc (the respondent). The dispute concerned the respondent's alleged breach of a lease agreement for premises located at 100-102 Station Road, Cheltenham, Victoria. The applicants sought possession of the premises and damages for rent arrears and other outgoings. The matter was heard in the Magistrates' Court of Victoria.

The primary legal issue before the Court was whether the respondent had validly exercised its option to renew the lease agreement. The lease contained a clause requiring the respondent to give written notice of its intention to exercise the option at least three months prior to the expiry of the initial term. The applicants contended that the notice provided by the respondent was defective and therefore invalid, meaning the lease had expired and the respondent was in unlawful occupation.

Magistrate Kirov found that the notice of renewal provided by the respondent was indeed defective. The lease agreement stipulated that notice must be given "at least three months prior to the expiry of the term". The respondent's notice was dated 18 March 2022, and the lease expired on 17 June 2022. This meant the notice was given exactly three months prior to the expiry, not "at least three months prior". The Court applied the principle that where a contractual term specifies a minimum period, compliance requires exceeding that minimum period, not merely meeting it. Therefore, the option to renew had not been validly exercised.

The Court ordered that possession of the premises be given to the applicants within 28 days. The Court also ordered the respondent to pay the applicants a sum representing rent arrears and other outgoings from the date the lease expired until possession was given.