Head and Zimmermann Investments Pty Ltd
[2009] WASAT 61
•8 APRIL 2009
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL
STREAM: COMMERCIAL & CIVIL
ACT: COMMERCIAL TENANCY (RETAIL SHOPS) AGREEMENTS ACT 1985 (WA)
CITATION: HEAD and ZIMMERMANN INVESTMENTS PTY LTD [2009] WASAT 61
MEMBER: MR T CAREY (MEMBER)
HEARD: DETERMINED ON THE DOCUMENTS
DELIVERED : 8 APRIL 2009
FILE NO/S: CC 1159 of 2008
BETWEEN: BRIAN HEAD
Applicant
AND
ZIMMERMANN INVESTMENTS PTY LTD
Respondent
FILE NO/S :CC 1767 of 2008
BETWEEN :ZIMMERMANN INVESTMENTS PTY LTD
Applicant
AND
BRIAN HEAD
Respondent
Catchwords:
Landlord and tenant - Retail shops - Rent review clause - Whether clause void for not specifying a 'single basis' under s 11(1) of the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA) - Whether clause saved by reference to procedure under s 11(3) of the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA)
Landlord and tenant - Retail shops - Renewal of lease - Failure to validly exercise option to renew - Whether prevented renewal where deeds of extension executed - Whether fundamental unilateral mistake entitling lessor to rectification - Whether misrepresentation amounting to false and misleading conduct - Tribunal's jurisdiction to consider such claim - Words and phrases: 'single basis on which the review is to be made'
Legislation:
Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA), s 11(1), s 11(3), s 27(2)
Commercial Tenancy (Retail Shops) Agreements Amendment Act No 66 of 1998 (WA)
Fair Trading Act 1987 (WA)
Interpretation Act 1984 (WA), s 19(1)(a), s 19(1)(b)(i)
State Administrative Tribunal Act 2004 (WA), s 27(3), s 91
Trade Practices Act 1974 (Cth)
Result:
Answers to referred questions given
Category: B
Representation:
CC 1159 of 2008
Counsel:
Applicant: Mr J Eastoe
Respondent: Mr M Levitan
Solicitors:
Applicant: Jonathan Eastoe, Solicitor
Respondent: Melvyn Levitan
CC 1767 of 2008
Counsel:
Applicant: Mr M Levitan
Respondent: Mr J Eastoe
Solicitors:
Applicant: Melvin Levitan
Respondent: Jonathan Eastoe, Solicitor
Case(s) referred to in decision(s):
Gilbert J McCaul (Aust) Pty Ltd v Pitt Club Ltd (1959) 59 SR (NSW) 122
Goldsborough, Mort & Co Ltd v Carter (1914) 19 CLR 429
Holliday v Overton (1852) 14 Beav 467; 51 ER 366
O'Connor's Management Pty Ltd v Kao Holdings Pty Ltd [1998] WASCA 2
United Scientific Holdings Ltd v Burnley Borough Council [1977] 2 ALL ER 62
REASONS FOR DECISION OF THE TRIBUNAL:
Summary of Tribunal's decision
The lessee under a retail shop lease referred to the Tribunal a question concerning the validity of the rent review term in the original lease (his occupation of the leased premises no longer being under that lease). He claimed that the term, allowing for review by reference to the greater of CPI and a fixed percentage, contravened a legislative requirement for rent review provisions to specify a single basis upon which the review is to be made. The lessor contended that the term of the original lease was not in contravention.
The Tribunal construed the legislation assisted by the second reading speech when the current provision was introduced and found that the term of the lease did not specify a single basis for review. As such, it was void.
The lessor, within the rubric of its own question referred to the Tribunal, submitted that the rent review clause still operated by way of a 'saving' provision which defaulted to the procedure for market rent reviews under the retail shops legislation. Construing the provision relied upon, the Tribunal found that the clause was not saved as the lessor contended.
The third question referred to the Tribunal, again by the lessor, concerned the validity of successive 'deeds of extension' of the original lease. The lessor submitted the deeds were invalid, and did not bestow a continuing leasehold interest on the lessee, because the lessee failed to validly exercise his option to renew the original lease. The outcome for which the lessor contended also relied upon claims of unilateral mistakes and misrepresentation.
The Tribunal found the extension deeds to be valid. It did not accept any of the grounds of invalidity advanced by the lessor, and was not prepared to allow the determination of the referred question to be delayed pending court proceedings, not yet commenced, to be undertaken in a court to vindicate the lessor's claims when it considered those claims to be tenuous.
Introduction
These consolidated applications concern the leasing of commercial premises known as Shop 1, Astor Lane, 665 Beaufort Street, Mount Lawley by the respondent (Zimmermann Investments) to the applicant (Mr Head).
It is common cause that, by a lease executed by the parties and dated 20 November 2000, Mr Head leased the premises for an initial term of one year commencing 1 October 2000, with three options of renewal of five years each.
Mr Head has remained in occupation of the premises since the commencement date of the initial one‑year term. However, by matter CC 1767 of 2008 (Zimmermann application), Zimmermann Investments has raised a question (one of two it has referred to the Tribunal) as to the legal basis of Mr Head's occupation since the expiry of the initial term. The referred question is as follows:
Are the Deeds of Extension of Lease dated 22/06/04 and 11/08/06 made between the Applicant as the Lessor and the Respondent as Lessee and Catherine Head as Guarantor valid?
Zimmermann Investments contends that Mr Head failed to exercise the option to renew the original lease by the giving of the required notice within the time period provided by the original lease; that this had the consequence that the original lease expired by the effluxion of time on 30 September 2001; and that Mr Head's occupation of the premises has been on a holding over basis since then. Deeds of extension of the lease in 2004 and 2006 based upon the exercise of the first two options were, according to Zimmermann Investments, invalid.
Mr Head denies the assertions of Zimmermann Investments and, in particular, relies upon the two deeds of extension as grounding his ongoing leasehold interest.
In matter CC 1159 of 2008 (Head application), Mr Head has referred to the Tribunal a question regarding the validity of the rent review clause in the original lease. The referred question is in the following terms:
Whether clause 2.05 of the Original Lease is void insofar as it purports to provide for annual rent reviews during the currency of the First Option Term; The Second Option Term and the Third Option Term by reason of section 11(1) of the Commercial Tenancy (Retail Shops) Agreements Act 1985.
Zimmermann Investments, in the Zimmermann application, also referred a question concerning 'the intent of clause 2.05 … to substitute the rent review method as contained in the Lease with Section 11 of the [Commercial Tenancy (Retail Shops) Agreements Act 1980 (WA) (CT(RS)A Act] in the event that any part of cl 2.05 is held to be invalid'.
I will deal first with the referred question under the Head application and the related question under the Zimmermann application, as they each raise a discrete question which falls to be answered by the Tribunal regardless of the outcome of the question as to the validity of the extension deeds. I will then consider that (validity) question.
Referred question under the Head application: Is the rent review clause void for breach of s 11(1) of CT(RS)A Act?
Second referred question under the Zimmermann application: Is the intent of cl 2.05 to substitute the rent review method in s 11 of the CT(RS)A Act in the event of any invalidity of that clause?
I reproduce in full cl 2.05 of the original deed of lease:
For the purposes of this Lease the period specified in Item 6 of the Third Schedule hereto shall be called the 'Review Period'.
The first Review Period shall commence on the Date of commencement hereof and the subsequent Review Periods during the balance of the term hereof or any extension or extensions thereof shall commence immediately upon the expiration of the preceding Review Period.
The annual rate at which rent is payable by the Lessee to the Lessor shall be reviewed as at the expiration of each Review Period for the next following Review Period or (where applicable) any shorter period for which this Lease may subsist (without prejudice however to further variation pursuant to Clause 2.07) and the Annual Rent for such Review Period shall be calculated on the basis of the Consumer Price Index ('CPI') or three per cent (3%) whichever is the greater.
The basis of the Consumer Price Index shall be determined in the following manner:-
(i)the Current Annual Rent multiplied by the last published CPI and then divided by the last CPI that was published at the date the current annual rent was set;
(ii)'CPI' means the Consumer Price Index ‑ All Groups for the City or place where the building is located published by the Australian Bureau of Statistics or any index which officially replaces it. If no index officially replaces it the Lessor will arrange for an expert to assess what it would have been. The Lessee and the Lessor must each pay half of the expert's fees and expenses.
The tenant must pay the new rent from the Review Date. However, until the Lessor notifies the Lessee of the new rent, the tenant will continue to pay the current rent. The tenant will pay any shortfall for that period on the next date for payment of rent after the landlord notifies the tenant of the new rent.
If the provisions of the [R]etail Shops Act apply to this Lease and if on a proper construction of Section 11 (3) of that Act the rent review procedures described in that sub‑section must be followed either in addition to the rent review procedures contained in this clause or in substitution for those procedures, then the procedures contained in this clause shall not be followed and the Annual Rent shall be reviewed as determined solely in accordance with Section 11 (3) of the Retail Shops Act upon the basis that the rent payable from the review date shall be the fair market rental for the Leased Premises.
Notwithstanding anything to the contrary expressed or implied in this Lease the provisions of Section 11 (2) of the Retail Shops Act shall not apply to this Lease.
Mr Head contends that the third paragraph of the clause offends s 11(1) of the CT(RS)A Act. That subsection provides:
A provision in a retail shop lease for review of the amount of rent payable under the lease during the currency of the lease is void unless the lease specifies, in respect of each occasion on which the review is to be made, a single basis on which the review is to be made.
In short, Mr Head says that cl 2.05 of the original deed of lease does not specify a single basis on which the review for which it provides is to occur, but rather a dual basis, namely, the greater of the Consumer Price Index (CPI) and 3%.
Although the Head application sought a declaration pursuant to s 91 of the State Administrative Tribunal Act 2004 (WA) (SAT Act) that cl 2.05 of the original deed of lease is void, and the Zimmermann application similarly sought vindication in respect of both its referred questions by appropriate declarations, as was indicated at a directions hearing, the disputes between the parties are amenable to resolution simply by provision of answers to the referred questions. This is particularly so where, as here, the questions inquire as to the validity or proper construction of contracts or contractual terms.
Zimmermann Investments raised two grounds for asserting that cl 2.05 of the original deed of lease is not void. The first ground is that, on a proper construction of the review mechanism stipulated by the clause, only a single basis for review arises. The second ground (which is agitated by Zimmermann Investment's second referred question) is that, in the event that the review mechanism falls foul of s 11(1) of the CT(RS)A Act, the clause continues to have operation by its reference to s 11(3) of the CT(RS)A Act. I will deal with each ground in turn.
A single basis for review?
Zimmermann Investments relied upon a decision of the Supreme Court in O'Connor's Management Pty Ltd v Kao Holdings Pty Ltd [1998] WASCA 2 (O'Connor's Management). That decision was made at a time that the legislation simply required the lease 'to specify the basis on which or the formula by which the review was to be made'. Although Zimmermann Investments submitted that this formulation was synonymous with the expression 'a single basis', and the decision in the case was a finding that on the correct interpretation of the rent review clause in question the lessor was entitled to the higher of market rent and a 6.5% increase, a consideration of the extraneous material to which I am permitted to have regard in considering the correct construction of s 11(1) of CT(RS)A Act as it currently stands (and stood at the time of execution of the lease in question) undermines such reliance.
Section 11(1) of the CT(RS)A Act was amended to its current form by the Commercial Tenancy (Retail Shops) Agreements Amendment Act No 66 of 1998 (WA) (Retail Shops Amendment Act). I am entitled to have regard to the second reading speech when the Bill was before Parliament by reason of one or both of s 19(1)(a) or s 19(1)(b)(i) of the Interpretation Act 1984 (WA). The relevant passages have been reproduced in the submissions dated 11 February 2009 of Mr Head and I incorporate them by reference into these reasons. The example given in those passages by the then Minister for Fair Trading of leases having more than one method of calculating rent of 'the greater of CPI, market rent, or 10 per cent', and the Minister's confirmation that the Bill provided 'that people cannot have the best of all worlds, such as a consumer price index rise, a 10 per cent increase or a market valuation' and that '[t]here must be one method of calculation' remove any doubt in the interpretation of s 11(1) of the CT(RS)A Act that each of CPI, market rent and a stipulated percentage increase does constitute a separate basis for review for the purposes of the subsection. If the rent review term of a lease refers to more than one basis, and designates that the higher or greater of them dictates the outcome, it will contravene s 11(1) of the CT(RS)A Act. In my view, the second reading speech supports the ordinary and natural meaning of the words of the subsection in any event.
The result is that the relevant stipulation for rent review in cl 2.05 of the original deed of lease (and also the rent review provisions in O'Connors Management) does not constitute a single basis on which rent reviews were to be conducted, but rather, a dual basis. The stipulation is therefore void under s 11(1) of the CT(RS)A Act.
Residual operation of cl 2.05 of the original deed of lease?
Zimmermann Investments' second ground for upholding the validity of cl 2.05 of the original deed of lease relies upon what it refers to as a 'saving provision' in the clause which operated in the event of the illegality of the third paragraph. According to its statement of issues, facts and contentions, the remaining paragraphs in cl 2.05 of the original deed of lease 'clearly indicated an intent that the [CT(RS)A] Act's method of calculating rent reviews (market value) was to apply in substitution of what was agreed between the parties and in the manner set out in the [CT(RS)A] Act', if part of the clause was not 'in conformity' with s 11(1) of the CT(RS)A Act. Particular reliance is placed upon the use of the word 'substitution' in the sixth paragraph of cl 2.05 of the original deed of lease. In the event of any ambiguity of meaning of cl 2.05 of the original deed of lease in this regard, rectification of the lease may be necessary on an application to the Supreme Court.
As was the case with s 11(1) of the CT(RS)A Act, it is necessary to construe the paragraph of the clause under consideration in order to determine its intent, and also its operation on the prevailing facts. The paragraph commences: 'If the provisions of the [CT(RS)A] Act apply to this lease …'. It is common cause that they do. The next condition, 'if on a proper construction of section 11(3) of that Act the rent review procedures described in that subsection must be followed …' requires consideration of s 11(3) of the CT(RS)A Act to see whether it applies.
Section 11(3) of the CT(RS)A Act commences with the following:
A retail shop lease that provides for review of the amount of rent payable during the currency of the lease shall be taken to provide …
The conclusion I have reached that the third paragraph of cl 2.05 of the original deed of lease purporting to fix a basis for rent reviews is void means that that paragraph (and the fourth, which depended upon the validity of the third) do not provide for a review of rent payable under the lease. The contention of Zimmermann Investments is that the remainder of the clause saves it by substituting for the invalidated method the market review method contemplated by s 11(3) of the CT(RS)A Act. Section 11(3) of the CT(RS)A Act prescribes procedures to be followed in cases where a lease provides for review of rent. It does not, of itself, so provide. Therefore, it cannot be said that on a proper construction of s 11(3) of the CT(RS)A Act, the rent review procedures which it describes must be followed in any particular instance, including on the facts of this case. The result is that the sixth paragraph of cl 2.05 of the original deed of lease has no application and does not operate to save the clause.
The apparent intention of the sixth paragraph of cl 2.05 of the original deed of lease is to confirm what is, in any event, the effect of s 11(3) of the CT(RS)A Act that, where s 11(3) applies (that is, where a lease provides for rent review), the s 11(3) procedures are to be followed. The point which the submission of Zimmermann Investments misses is that s 11(3) does not of itself prescribe when it applies, other than by reference to the requirement that the lease provide for rent review. Because the lease here does not so provide, the contingency with which the paragraph is concerned does not arise, and the s 11(3) procedures do not apply.
As for the suggestion on Zimmermann Investments' behalf that it ought be entitled to apply to the Supreme Court for rectification of cl 2.05 of the original deed of lease so that it operates in the way for which it contended (failing this Tribunal making a declaration to the same effect), such an application would need to overcome some serious obstacles. They include:
•The correct approach to construction of a contractual clause is to ascertain the objective intention of the parties from the words used: Goldsborough, Mort & Co Ltd v Carter (1914) 19 CLR 429 at 447. In any event, as I have found, the words used here are conditional upon a contingency which did not arise on the facts.
•Rectification will not be granted to deny the correct construction of a clause merely because it does not reflect one party's subjective understanding of the words chosen. In particular, it will not be available where a party misunderstands the legal effect of the words used.
•Even if, despite the above obstacles, Zimmerman Investments were permitted to adduce parole evidence of the parties' intention prior to execution of the original lease, the only evidence disclosed in these proceedings appears in [3] of Mr Zimmermann's statement, which deals with the negotiations leading to an agreement that rent increases were to be in accordance with the CPI or 3% which[ever?] was the greater. There is no mention of any other alternative, and specifically market review.
Although in a proper case it is possible to transfer a question referred to the Tribunal to a court having jurisdiction to determine it under s 27(3) of the State Administrative Tribunal Act 2004 (WA), the prospects of success of any application for rectification on the grounds disclosed in these proceedings does not commend such a course in this case. Further, the Tribunal's determination of the relevant questions referred must have regard only to the terms of the original lease as they currently stand.
For the above reasons, the answer to the question referred to the Tribunal in the Head application is 'Yes', and the answer to the second question referred to the Tribunal in the Zimmermann application is 'No'.
First referred question under the Zimmermann Investments application: Are the deeds of extension of lease valid?
The Tribunal has had produced to it two deeds of extension. The first is dated 22 June 2004 and provides for the lease of the premises from 1 October 2001 for a term of five years (first extension deed). The second deed of extension is dated 11 August 2006 and provides for a lease of the premises for five years commencing 1 October 2006 and terminating at midnight on 30 September 2011 (second extension deed).
According to the written submissions and statement of issues, facts and contentions filed by Zimmermann Investments, the deeds of extension are of no effect for some or all of the following reasons:
(a)Mr Head's failure to exercise the option to renew under the original lease in accordance with the requirements for doing so in the original lease meant that the original lease was not renewed, regardless of the two extension deeds.
(b)The first extension deed could not have the effect of reviving the original lease, where the first extension deed did not contain a clause rectifying Mr Head's failure to exercise the option to renew the original lease.
(c)The first extension deed made the lessor's consent to the extension conditional upon the lessee's compliance with its obligations under the first extension deed and the original lease. The requirements for exercising the option comprised such an obligation.
(d)The execution by Zimmermann Investments of the first extension deed occurred under a fundamental mistake as to the renewal of the original lease ‑ that is, that it had been renewed upon a valid exercise of the option.
(e)The lessor's consent to the first extension deed was vitiated by the same fundamental mistake.
(f)The second extension deed was similarly vitiated based upon the same fundamental mistake.
(g)If necessary, an application to a court having equitable jurisdiction may be necessary in order to have the extension deeds set aside for a unilateral mistake.
(h)Mr Head represented to Zimmermann Investments, at the times it was seeking renewal prior to execution of both extension deeds, an entitlement to exercise the option to renew whereas, in fact, the original lease was terminated by effluxion of time.
Mr Head did not challenge that he had not exercised the option to renew under the original lease in accordance with the requirements for doing so set out in that lease. Mr Head suggests that, in the case of both the first renewal (towards the end of the original lease) and the second renewal (towards the end of the first renewal term), he exercised the option late. It is not submitted on his behalf that any late exercise of the option was valid, and it would have been a difficult assignment to justify such a claim: see United Scientific Holdings Ltd v Burnley Borough Council [1977] 2 ALL ER 62 at 71 ‑ 72. According to Mr Head's statement of issues, facts and contentions, the issue as to whether the option for the first renewal term was exercised is largely, if not wholly, irrelevant, and the contractual position between the parties must be determined by reference to the first extension deed and the second extension deed. According to Mr Head, these are stand‑alone enforceable leases, regardless of whether any applicable option to renew was validly exercised.
It is convenient to deal with the validity of the two extension deeds by considering each of the matters relied upon by Zimmermann Investments to contend that the deeds are invalid. Referring to those contentions as described above, contentions (a) to (c) are linked by the premise that the exercise of the first option was an essential precondition to the validity of the extension deeds, and I will deal with those questions together. Contentions (d) to (g) are based upon the assertion of a fundamental mistake on Zimmermann Investments' part about Mr Head's entitlement to a renewed lease. Again, those four arguments are properly to be dealt with together. Contention (h) raises the spectre of representations by Mr Head amounting to false or deceptive conduct. I will deal with this as a separate matter.
Exercise of first option an essential condition for valid extension deeds?
Zimmermann Investments has cited no authority for the basic premise upon which the first three arguments depend, namely, that failure to exercise a renewal option strictly within the terms for doing so provided by a lease generally constitutes a bar to any renewal. A lease obtained by the exercise of an option to renew is a new lease, a new demise: see Commercial Tenancy Law in Australia, Bradbrook and Croft, Butterworths, Second Ed (Bradbrook) at 259. As a matter of logic, although the valid exercise of an option is one way of securing a new lease, there is no reason why, where there is a pre‑existing lease, it is the only way.
Moreover, although there is some conflict in the authorities concerning the proper characterisation of an option, the alternatives being that an option is either a contract subject to conditions or an irrevocable offer, the irrevocable offer view appears to be the predominant one in Australia: Bradbrook at 260 ‑ 261. The following passage from Gilbert McCaul (Aust) Pty Ltd v Pitt Club Ltd (1959) 59 SR (NSW) 122, a case in which the New South Wales Court of Appeal unanimously adopted the 'irrevocable offer' characterisation of options to renew, is reproduced in Bradbrook at 261:
In the present case the lessor irrevocably offered to grant a lease. Its offer prescribed the time and manner for acceptance. Only by performing the conditions prescribed could it be accepted and result in an agreement for a lease. A purported acceptance without performance of the prescribed conditions would not and could not be an acceptance of the offer. It would in reality be a counter-offer by the original offeree requiring acceptance by the original offeror if an agreement were to result. If a conditional offer is made and the offeree without performing the condition purports to accept it, that is to say makes a counter‑offer and that counter‑offer is accepted, it is a loose although not uncommon use of language to say that the original offeror has waived performance of the condition which was prescribed by his offer as being the manner of accepting. In contemplation of law the original offeror has done no such thing. What he has done is to accept a counter‑offer and in the result an agreement is made but it is not an agreement consisting of the original offer and an acceptance of that offer.
What this passage contemplates is that a purported exercise of an option to renew without compliance with the conditions prescribed for the time and manner for acceptance, as has occurred here, amounts to a counter‑offer by the original offeree of the irrevocable offer (being the option to renew). The counter‑offer may or may not be accepted by the original offeror. Accepting, as I do, that this is the correct analysis, the effect of the non‑compliance cannot be to so infect the renewal process that acceptance of the non‑compliant exercise of the option would be ineffectual, unless the lease which resulted dealt with the non‑compliance specifically so as, to use Zimmerman Investments' word, to 'rectify' the lessee's failure in that regard.
Zimmermann Investments' argument (c) is of a slightly different character and relies upon the following provision in the first extension deed ([6]):
The Lessor's grant of the Further Term is in every respect conditional upon the execution of this Deed by every party to this Deed and the Lessee's compliance with its obligations under this Deed and the Lease.
Mr Head's failure to exercise the option in accordance with, specifically, the time requirement for doing so under the original lease, is said to constitute a failure by Mr Head to comply with his obligations under the lease.
In my view, the obligations with which the clause is concerned are those obligations typically referred to as the 'lessee's covenants', such as punctual payment of the rent, keeping the premises in good and tenantable repair, various obligations regarding use of the premises, limitations on assignment and underletting the premises and the like. The conditions applying to the valid exercise of an option are of a wholly different nature, in terms of both quality and consequences of non‑compliance. So, for example, if the lessee failed to exercise an option as required, the lessor would not be entitled to take action against the lessee such as a claim for damages or possession by reason of the non‑compliance (as distinct from the lease having terminated by effluxion of time). Nor, in my view, could such a failure constitute a breach of the lessee's obligations under the lease for the purposes of [6].
Fundamental mistake vitiating extension deeds?
Zimmermann Investments submitted, at [2.5] of its statement of issues, facts and contentions:
Further and or alternatively the Respondent unilaterally executed the first Deed of Extension of Lease on the basis of a fundamental mistake as to the existence/validity of the original Lease which the Applicant was well aware of had terminated in September 2001 and did not inform the respondent;
and at [2.6]:
The Lessor's consent in paragraph 6 of the First Deed of Extension is vitiated by the fundamental mistake as to the existence of the Original Lease. Further the First Deed of Extension in paragraph 8 gives the Respondent all remedies under the First Deed at law and in equity.
Paragraph 6 of the first extension deed is reproduced in the previous section of these reasons. Paragraph 8 of the same deed is in the following terms:
All remedies either under this deed or at law or in equity or under statute or otherwise afforded to the Lessor shall be cumulative and not alternative.
The evidentiary basis for these arguments appears from a statement of Mr Bruno Karl Zimmermann, a director of Zimmermann Investments. The full terms of [4] to [6] of that statement are reproduced below. Although parts of this evidence are disputed by Mr Head, it is sufficient for my purposes to rely upon Mr Zimmermann's account:
4.In or about the later part of 2004 I was walking along Astor Lane in the area in which the Leased Premises were located and Head asked me 'Can you give me the first option?'. I assumed that[,] as all my Leases were normally for a minimum period of three years[,] that [sic] his Lease was accordingly the same and I told him that there was no problem. He then said that he didn't want Melvyn Levitan to draft the Lease because he claimed that he was too expensive. I then contacted the Law Society and [it] gave me the names of three firms which did Lease documentation. I contacted one firm that was closest to me, Vincent Partners[,] and [Vincent Partners] agreed to draft the Deed of Extension. The Deed of Extension was done by Vincent Partners and at no stage was I told that the original Lease had terminated. Had I been aware of this fact I would have instructed [Vincent Partners] to do a new Lease with Head as his old Lease was at an end.
5.In all the rent reviews which I conducted I always charged Head the Consumer Price Index increase. On or about some time [sic] in July 2006 Head spoke to me again while I was walking in the [sic] Astor Lane and he told me that he wanted to exercise his second option. I told him to send me a letter and to send a copy to Melvyn Levitan who did all the Leases for the Centre. He sent a letter dated 23 July 2006 to that effect. Accordingly, the second Deed of Extension was executed on 11 August 2006 for the extended period commencing 1 October 2006 and terminating on 30 September 2011. Had I been aware that he had not exercised his option and that his Lease was at an end[,] I would have requested a new Lease to be drawn but I was unaware of that matter.
6.I was completely under the impression that Head had a valid Lease and was entitled to the Deeds of Extension. As stated before[,] if I was aware he didn't I would have had a new Lease drawn up.
Mr Zimmermann's evidence, relevantly for current purposes, amounts to this: In 2004, and again in 2006, Mr Head requested whether he could exercise an option. In relation to the 2004 request, Mr Zimmermann made an assumption that the original lease was for a minimum of three years, and on the basis of that assumption, he indicated that there would be no problem in granting the option requested. In relation to the later request, there is no reference to any assumption going to Mr Head's ongoing right as a lessee, but merely to the requirement under the lease that the exercise be in writing. Had Mr Zimmermann been aware in 2004 'that the original Lease had terminated', he says that he would have instructed his solicitors 'to do a new Lease', although he does not indicate what the terms of the new lease would have been. A similar assertion is made in respect of what would have occurred in 2006 had Mr Zimmermann known that '[Mr Head]'s Lease was at an end'.
In my view, Zimmermann Investments' arguments are misconceived on a number of levels.
First, they depend upon the premise, which is erroneous for reasons I have given, that a failure by a lessee to exercise an option in accordance with the strict terms for doing so necessarily results in the non‑renewal of the lease, regardless of any other dealings between the same parties, except in limited circumstances. Contrary to the arguments of Zimmermann Investments, even where either option was not validly exercised, the parties were perfectly free to negotiate a new lease to commence immediately upon the expiry of the term of the previous lease, which is what occurred on two occasions.
Second, the arguments further depend upon Mr Head, as the lessee, being under a duty to inform Zimmermann Investments, as the lessor, of matters pertaining to the lease which might be relevant to the protection of the lessor's interests. As far as I am aware, the law of mistake (and, for that matter, misrepresentation) has never gone so far. Zimmermann Investments was just as able as Mr Head to independently ascertain the legal position as to Mr Head's entitlement to renewal under each option to renew. On each occasion, it instructed lawyers in relation to the renewal request. It was for Zimmermann Investments to challenge any entitlement if that was an issue for it, but did not do so.
Third, the first extension deed provided for a lease for a term of five years at a rental of $7,002 per annum plus GST, compared with the rental under the original lease of $6,600 per annum plus GST. Mr Head occupied the premises, and paid the rent at the increased rate, for the duration of the five‑year term. Similarly, the second extension deed, for a five‑year term, provided for the higher annual rent of $8,514.24, although this figure was inclusive of GST. Mr Head has occupied the premises during the term of the second extension deed and paid the rent for which it provides. The submission on Mr Head's behalf that it defies imagination to contemplate any possible basis on which a Court of Equity would set aside the first extension deed, prepared by the landlord's solicitors and which has run its course and been replaced by a further extension deed, under which a lessor has received increased rents dating back to 2001, has a good deal of force.
Fourth, the recitals to each of the extension deeds include the agreement of Zimmermann Investments to grant to Mr Head either 'possession of the premises for the further term' or 'an extension of the Original Lease', in each case in accordance with the provisions of the original lease and the respective extension deed. Recital B to the second extension deed is in the following terms:
The Lessee prior to execution of this Deed of Extension held the Leased Premises in accordance with the provisions of the Original Lease and a Deed of Extension of Lease dated 22 June 2004.
In my view, this recital has the effect that Zimmermann Investments is estopped from raising the arguments it now seeks regarding the non‑existence of a leasehold right of Mr Head, at least as at August 2006, when the second extension deed was signed: see Holliday v Overton (1852) 14 Beav 467 at 470; 51 ER 366.
For all the above reasons, I discount any prospects of success should Zimmermann Investments apply to a court of equitable jurisdiction to have set aside the extension deeds for unilateral mistake, and can see no benefit in these proceedings being delayed by a transfer of the matter to a court under s 27(3) of the CT(RS)A Act.
Misleading or deceptive conduct?
A number of the matters raised in rejecting the contentions for an operative mistake apply equally to the argument for a misrepresentation amounting to misleading or deceptive conduct. Thus, the misrepresentation argument depends upon the false premise that the true state of affairs (that Mr Head did not have an entitlement to renew the lease) meant that Mr Head was, in general terms, not in a position to renegotiate a lease. Second, even if misrepresentation as to a lessee's entitlement to renew can be established, a prudent lessor should make its own checks on such a basic matter. Third, the same estoppel arises in respect of any misrepresentation claim.
It is unclear from Zimmermann Investments' statement of issues, facts and contentions (where the misleading or deceptive conduct claim is raised) by what means the Tribunal can act upon a proven allegation of misleading or deceptive conduct to vitiate a lease (or, in this case, the two deeds of extension of lease). This Tribunal has no such jurisdiction as that which appears under the Trade Practices Act 1974 (Cth) and the Fair Trading Act1987 (WA) to strike down contracts for misleading or deceptive conduct. Since 2007, the Tribunal has had jurisdiction to consider claims of unconscionable conduct on the part of both landlords and tenants in connection with a lease. However, Zimmermann Investments' claim is not framed as one of unconscionable conduct. In any event, in order for the Tribunal's unconscionable conduct jurisdiction to be invoked, the conduct complained of must have occurred after 11 May 2007. The conduct in this case, such as it is, occurred in 2004 and 2006.
Further, on my assessment of it, the evidence produced by Zimmermann Investments discloses no proper factual basis for claiming that it was misled or deceived by Mr Head. Based on Mr Zimmermann's evidence, it was not the case, as asserted in the Zimmermann Investments statement of issues, facts and contentions, that Mr Head represented that he was entitled in 2004 to exercise the first option. Rather, according to the witness statement, Mr Head merely asked Mr Zimmermann: 'Can you give me the first option?', and Mr Zimmermann made his own assumption as to Mr Head's entitlement in that regard. Acting on his own, incorrect, assumption, Mr Zimmermann made arrangements for the first extension deed to be drafted. He could have queried Mr Head on his entitlement to renewal, which, had he done so, would presumably have revealed that he did not, and things may have then developed differently. That is not a matter for which Mr Head is answerable.
Turning to 2006, Mr Zimmermann's statement goes no further than asserting that Mr Head told him that he wanted to exercise his second option, to which Mr Zimmermann's response was to send a letter to him and Zimmermann Investments' lawyer. Neither the oral statement attributed to Mr Head, nor the letter of Mr Head (which included 'I refer to clause 2.06 of the above‑named lease and confirm my exercise of the option for a further 5 years') contains a representation of entitlement. Mr Head was in no better position than Mr Zimmermann, or Zimmermann Investments' lawyers, to ascertain whether the exercise of the option was in compliance with the preconditions for that exercise.
Again, in the circumstances as I have outlined them, there is no proper reason, in my view, to facilitate a transfer of this proceeding to another forum for determination of a claim that Mr Head engaged in misleading or deceptive conduct, with the attendant delay of such a course, where the claim appears so tenuous.
For the above reasons, the answer to the first question referred to the Tribunal in the Zimmermann application is 'Yes'.
Order
In CC 1159 of 2008:
The answer to the question referred to the Tribunal ‑ 'Whether clause 2.05 of the Original Lease is void insofar as it purports to provide for annual rent reviews during the currency of the First Option Term, the Second Option Term and the Third Option Term by reason of section 11(1) of the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA)' ‑ is 'Yes'.
In CC 1767 of 2008:
The answer to the question referred to the Tribunal ‑ 'Whether the Deeds of Extension of Lease dated 22 June 2004 and 11 August 2006 made between the applicant as lessor and the respondent as lessee and Catherine Head as guarantor are valid' ‑ is 'Yes'.
The answer to the question referred to the Tribunal ‑ 'Is the intent of clause 2.05 in the Original Lease dated 20 November 2000 made between the applicant as lessor and the respondent as lessee and Catherine Head as guarantor to substitute the rent review method as contained in the Lease with section 11 of the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA) in the event that any part of clause 2.05 is held to be invalid?' ‑ is 'No'.
I certify that this and the preceding [56] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
___________________________________
MR T CAREY, MEMBER
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL
STREAM: COMMERCIAL & CIVIL
ACT: COMMERCIAL TENANCY (RETAIL SHOPS) AGREEMENTS ACT 1985 (WA)
CITATION: HEAD and ZIMMERMANN INVESTMENTS PTY LTD [2009] WASAT 61 (S)
MEMBER: MR T CAREY (MEMBER)
HEARD: DETERMINED ON THE DOCUMENTS
DELIVERED : 8 APRIL 2009
SUPPLEMENTARY
DECISION :9 JULY 2009
FILE NO/S: CC 1159 of 2008
BETWEEN: BRIAN HEAD
Applicant
AND
ZIMMERMANN INVESTMENTS PTY LTD
Respondent
FILE NO/S :CC 1767 of 2008
BETWEEN :ZIMMERMANN INVESTMENTS PTY LTD
Applicant
AND
BRIAN HEAD
Respondent
Catchwords:
Landlord and tenant - Retail shops - Costs - Exercise of discretion - Assessment of reasonable costs
Legislation:
Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA), s 11(1)
State Administrative Tribunal Act 2004 (WA), s 87(1), s 87(2)
Result:
Order for costs of $9,000 (exclusive of GST)
Category: B
Representation:
CC 1159 of 2008
Counsel:
Applicant: Mr J Eastoe
Respondent: Mr M Levitan
Solicitors:
Applicant: Jonathan Eastoe, Solicitor
Respondent: Melvyn Levitan
CC 1767 of 2008
Counsel:
Applicant: Mr M Levitan
Respondent: Mr J Eastoe
Solicitors:
Applicant: Melvyn Levitan
Respondent: Jonathan Eastoe, Solicitor
Case(s) referred to in decision(s):
Head and Zimmermann Investments Pty Ltd [2009] WASAT 61
J & P Metals Pty Ltd and Shire of Dardanup [2006] WASAT 282 (S)
Pearce and Germain [2007] WASAT 291 (S)
Summerville and Department of Education & Training [2006] WASAT 368 (S)
REASONS FOR DECISION OF THE TRIBUNAL:
Summary of Tribunal's decision
The lessee of commercial premises succeeded before the Tribunal in relation to three questions referred for determination. He sought an order for his legal costs.
The Tribunal considered the circumstances in which it might be appropriate to exercise its discretion to award costs, and the correct approach to adopt in arriving at the amount of costs to be awarded in a proper case, by reference to its previous decisions. On considering the relevant factors, the Tribunal concluded that the applicant was entitled to a costs order, limited to costs reasonably incurred in relation to the respondent's claim that there was no valid lease currently operating.
Although no bill of costs referable to the particular scale relied upon by the applicant was filed, the Tribunal made its own assessment based upon an itemised account of actual charges and applying a series of discounts. In the result, the respondent was ordered to pay costs of $9,000.
Relevant background
On 8 April 2009, the Tribunal delivered its decision on three questions referred to it by the parties. Those questions were:
1)whether the rent review clause in the written lease between the parties was void for breach of a requirement of the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA) (Retail Shops Act) requiring such a clause to specify a single basis on which the review is to be made;
2)whether it was the intent of the clause, in the event that the rent review provision was invalid, to substitute another mechanism for rent review; and
3)whether two deeds of extension of lease were valid (in order to determine whether the lessee's current occupation was pursuant to the terms of a written lease or as an overholding tenant).
The first question was the subject of application CC 1159 of 2008, brought by Mr Head (applicant) (Head application). Both the second and third questions were the subject of application CC 1767 of 2008, brought by Zimmermann Investments Pty Ltd (respondent) (Zimmermann application). The two applications were treated as one consolidated matter, which was the subject of the Tribunal's decision of 8 April 2009, published as Head and Zimmermann Investments Pty Ltd [2009] WASAT 61 (principal decision).
In the principal decision, the specific rent review clause in the original lease was found to be invalid, the remainder of the rent review clause was found not to operate so as to substitute any other rent review mechanism, and the deeds of extension were found to be valid. The applicant's case in relation to each of the three questions was thus vindicated. In light of this outcome, the applicant sought an order for his costs. The parties were directed to file written submissions and supporting documents relating to the costs application, and they have done so. This decision is made on the basis of the filed documents.
Costs in the Tribunal ‑ general principles
In a decision of the then Deputy President (now President) of the Tribunal in Pearce and Germain [2007] WASAT 291 (S) (Pearce), the then Judge Chaney was concerned with a costs application in a matter under the Retail Shops Act. His Honour noted that the starting point was that the Tribunal is a 'no costs' jurisdiction (see s 87(1) of the State Administrative Tribunal Act 2004 (WA) (SAT Act)). This is, however, subject to a broad discretion conferred by s 87(2) of the SAT Act to award costs. His Honour noted (at [22]) an earlier Tribunal decision (Summerville and Department of Education & Training [2006] WASAT 368 (S) per Justice Barker) in which it was said that it was not appropriate to delineate the particular circumstances in which the discretion to award costs would be exercised favourably, but then went on to identify a number of factors which may contribute to the Tribunal making a costs order.
At [24] in Pearce, Chaney J said:
... decisions on costs might serve to promote certainty and responsibility in parties to their contractual responsibilities. That does not mean that there is a presumption that costs will follow the event. Rather, where it is necessary for a party to a retail shop lease to take proceedings in the Tribunal to vindicate its clear contractual entitlements, and to incur costs in doing so, it will "often not be unreasonable for an award of costs to be made". The position is the same where costs are incurred in defending an obviously unmeritorious claim. Where, however, there is a genuine dispute between the parties to a lease, their respective rights are unclear and one or both seek determination of their rights in the Tribunal, the starting point remains that each party should expect to pay their own costs ...
In my view, the distinction drawn by his Honour between a party having to vindicate its clear contractual entitlements or to defend an obviously unmeritorious claim, on the one hand, and a genuine dispute in which one or both of the parties seek determination of their rights in the Tribunal, on the other, is particularly apposite in this case. So, where uncertainty has arisen based on a genuine doubt over the correct legal position on one or more issues pertaining to a leasehold relationship, the parties should not be inhibited by the disincentive of a potential costs order against the party who is ultimately unsuccessful from approaching the Tribunal to have the dispute determined. However, where the legal position on an issue or issues arising under a lease is clear, and therefore, should not be the subject of dispute, then a party whose conduct imposes upon the other party the need to seek confirmation from the Tribunal, or to incur costs in opposing an untenable claim, may well be the subject of a costs order against it.
Assuming there is to be an order for costs, the question will then arise as to how the calculation of those costs is to be approached. Some guidance on this question is to be derived from another decision of the Tribunal in J & P Metals Pty Ltd and Shire of Dardanup [2006] WASAT 282 (S) per Chaney J and Member Ms M Connor, (J & P Metals Pty Ltd) and in particular the following passage at [38]:
The procedures of the Tribunal are designed to achieve the objectives prescribed by s 9 of the SAT Act. The Tribunal strives to ensure that its procedures are proportionate to the nature of the matters in issue. On occasions, matters before the Tribunal are difficult and complex, sometimes involving lengthy hearings. … In the unusual event that an order for costs is made by the Tribunal, the Tribunal's obligation to minimise the costs to parties will be reflected in the costs assessed by the Tribunal as recoverable. That approach reflects an expectation that representatives of parties before the Tribunal will approach a proceedings [sic] in a way that minimises costs to their clients. If clients choose to approach proceedings before the Tribunal in a way which substantially increases costs for them, it will be a rare case where that increase in costs will be recoverable through a favourable costs order.
Consideration
The parties' respective submissions on costs touch upon a variety of issues, including the factors to be taken into account along the lines of those discussed in Pearce and other decisions; pre‑application negotiations between the parties; the consequences for the parties of the principal decision; the conduct of the parties in the course of the Tribunal proceedings; and the proper scope of, and basis for, any costs award. Although I have considered each of the matters raised by the parties, I will restrict myself in these reasons to indicating those factors which are to my mind significant in reaching the decision I have, and, to the extent that the costs application has been successful, in determining the amount of the costs to be awarded. I do not wish to compound what has been a relatively tortuous history of disputation between the parties with a lengthy dissertation on costs, when a concise statement of the essential factors and an explanation for the ultimate outcome should be all that is required.
I consider that the sole question raised by the Head application, and what was described in the principal decision as the second referred question under the Zimmermann application, both fit the description in Pearce of a genuine dispute between the parties to a lease, in respect of which both parties sought determination of their rights in the Tribunal. Although, with the benefit of hindsight (namely, the principal decision) it is easy to be critical of the position previously adopted by the unsuccessful party, there is no requirement for parties to only contend for positions which, for example, have a better than 50% prospect of being vindicated. It is also often true that the arguments finally relied upon in the context of court or tribunal proceedings are settled upon only subsequent to commencement of the proceedings, enabling a proper assessment of the relative strengths of the competing arguments only at that time. Further, as has been pointed out, the issue of the validity of the express rent review provision in the lease having regard to s 11(1) of the Retail Shops Act was purely a legal one admitting of only a 'Yes' or 'No' answer; as a result, it could be determined quite efficiently upon the documents, without the need for a hearing nor any investigation of competing evidence or the like. As the reasons for decision of the Tribunal disclose, the second referred question under the Zimmermann application demanded a somewhat more detailed analysis. However, in my view, although not ultimately successful, it was not unreasonable for the respondent to raise such an alternative claim and have it determined by the Tribunal at the same time as the Head application.
I turn then to the other question raised by the Zimmermann application of the validity of the deeds of extension of lease.
This issue represented a further alternative claim by the respondent that, regardless of the outcome of the rent review issues, the applicant's status as lessee was not, as he had understood, pursuant to the second of two extensions of lease, but rather, as an overholding lessee under the original lease. The initial point to be made is that the outcome of the claim was of significant moment to the applicant. Were the claim to succeed, it would mean that his assumed security of tenure, pursuant to a written extension of lease document, would be lost. The claim having been made on the respondent's behalf by its lawyer; the applicant was quite entitled to resort to his own legal representation in an attempt to ward off the attack on his legal rights.
As described in the principal decision at [31], the respondent relied upon some eight grounds to support its claim. Those grounds are dealt with in the principal decision at [33] ‑ [56], which contain a series of findings adverse to the respondent's arguments. The findings go to the legal bases upon which reliance was placed and the failure of the evidence to support any such ground. Taken together, in my view, the findings demonstrate the quality (or lack thereof) of the respondent's arguments fitting the description of 'obviously unmeritorious'. The arguments were suggestive of either a lack of appreciation or acceptance of the clear legal position, or a preparedness to rely upon a range of tenuous arguments for tactical advantage. Either way, this is the type of claim which is to be discouraged in the Tribunal by an appropriate order for costs consistent with the Pearce considerations.
What then is an appropriate award in the circumstances of this case?
It was submitted by the applicant that the respondent should be ordered to pay the applicant's proper and reasonable costs (including costs in respect of negotiations prior to the commencement of the proceedings and the costs of attending mediation conferences) to be assessed under item 32 of the Legal Practitioners (Supreme Court) (Contentious Business) Determinations 2006 and 2008 (Determinations). However, despite being directed to include in its submissions in support of a costs order 'particulars of the costs claimed', the applicant filed no bill of costs by reference to the Determinations. Rather, an itemised account of the actual costs charged to the applicant by his solicitor spanning the period July 2007 until April 2009 was provided, showing a total costs figure of $29,489 exclusive of GST. The itemised account covered the entirety of legal services provided to the applicant, including, apparently, all costs charged in relation to both the Head application and the Zimmermann application.
I have decided, in the interests of bringing these matters to finality and to avoid further costs to the parties, to determine a reasonable figure for costs doing the best I can on the basis of my knowledge of the SAT litigation and the documents filed in respect of the costs application. The alternative, to further delay the matter to enable a bill to be filed in accordance with the relevant scale, would in my estimation be wholly unsatisfactory. In setting myself such a task, it has not been possible to arrive at a reconstruction of the itemised account provided to accord with the appropriate scale (which I am satisfied would be either or both of the Determinations applicable at material times based on the consequences to the applicant if the claim succeeded), and my approach will be to refer to the itemised account and apply to it a number of discounts, the reasons for which I shall explain, to arrive at a final figure. I do note that the hourly rates applied in the itemised account are reasonable having regard to the maximum rates prescribed by the Determinations.
A significant part of the account relates to the period prior to the commencement of either of the SAT proceedings. Based on items of correspondence within the applicant's bundle of documents in respect of costs, it is clear that a substantial part of the pre‑application attendances concerned negotiations directed to rectification of both the original lease and second extension deed, arising partly from the asserted (and subsequently confirmed) invalidity of cl 2.05, but also to overcome other perceived omissions not the subject of either application. As such, despite the applicant's assertion to the contrary, in my view, none of the quite extensive costs incurred prior to the commencement of the Head application qualify for reimbursement. Helpfully, the itemised account provides details of hours spent before and after 1 July 2008, shortly prior to the issue of the Head application, as that was the date of a change of solicitor's hourly rate. When the pre‑1 July 2008 hours are excluded, the costs figure reduces to approximately $20,000.
In considering an appropriate amount to be paid by the respondent in respect of the single issue which I have found to justify the making of a costs order, a number of further discounts apply. The first is to remove the solicitor ‑ client margin inherent in the applicant's solicitor's account. Doing the best that I can on the basis of the information provided, I believe a 25% discount to be appropriate, resulting in a figure of $15,000.
The second discount reflects that the questions as to the validity of the rent review provision and construction of the remainder of the clause remained the subject of dispute in the Tribunal. It is also the case, however, that subsequent to the issue of the Zimmermann application, the significant majority of work required of the applicant's legal representative was directed to the respondent's new arguments that the deeds of extension were invalid. This is clear when one considers the contents of the parties' statements of issues, facts and contentions and witness statements. The additional discount in respect of this item will be 20%, reducing the figure to $12,000.
The final discount to be applied is by reason of what I will refer to as the 'SAT factor'. The SAT factor is the subject of the passage from J&P Metals Pty Ltd reproduced earlier in these reasons. The applicant's own submissions in support of its costs application appear to recognise the existence of such a factor by noting (albeit in support of a submission that had the respondent acted differently, the dispute would have been averted and the costs would have been substantially less) that the applicant's legal fees of over $30,000 compared with what is said to be a $3,803 subject‑matter, being the alleged overcharge resulting from the application of the invalid rent review clause. As I have indicated, the actual subject‑matter of the respondent's claim which gives rise to the costs liability concerned the applicant's security of tenure. However, the sentiment expressed in the applicant's submissions that it 'flies in the face of SAT's objectives for costs to exceed the amount of the claim' aptly summarises the Tribunal's desire that parties availing themselves of the Tribunal's processes should themselves exercise restraint in the manner in which they conduct themselves.
By reason of the application of the SAT factor, the $12,000 figure is reduced by a further 25% to $9,000. There will be an order for costs in favour of the applicant in that sum.
Order
The respondent shall pay to the applicant costs fixed at $9,000 (exclusive of GST) within 14 days of this order or as otherwise agreed between the parties.
I certify that this and the preceding [23] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
___________________________________
MR T CAREY, MEMBER
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