Hay & Colin Pty Ltd v West End Hospitality Pty Ltd

Hay & Colin Pty Ltd sought leave to appeal against a decision of the State Administrative Tribunal (SAT) that refused to exercise its jurisdiction to give consent to the redevelopment clause in a lease concerning early termination. The dispute related to a retail shop lease between Hay & Colin Pty Ltd and West End Hospitality Pty Ltd. The proposed clause allowed the lessor to terminate the lease if it desired to develop or redevelop the leased area. The SAT dismissed the application on the basis that it was dealing with a relocation clause. The appellant argued that the clause was an early termination clause and not a relocation clause. The court found that the SAT had erred in law by conflating the termination clause with a relocation clause and by failing to consider whether special circumstances existed to warrant the approval of the clause. The court granted leave to appeal and allowed the appeal, finding that special circumstances existed to approve the clause. The respondent supported the appeal and did not contradict the appellant's submissions.

The court adopted the approach of Curthoys J in 480 Hay Street Pty Ltd v Irwin St Lower Pty Ltd [2020] WASC 59, which held that "special circumstances" meant circumstances that were out of the ordinary but did not have to be extraordinary or exceptional. The court was satisfied that the appellant had demonstrated special circumstances to approve the clause, including the need to coordinate any future redevelopment of the premises around all the tenancies, the significant compensation for early termination, and the fact that the appeal was supported by the respondent. The court made orders in terms of the appellant's proposed minute of orders.