Lontav Pty ltd v Pineross Custodial Services Pty Ltd (No 2)

Lontav Pty Ltd, the landlord, brought an action against Pineross Custodial Services Pty Ltd, the tenant, for possession of hotel premises in Melbourne. The dispute centred around the validity of the lease agreement, particularly concerning the lessee's failure to maintain a necessary liquor licence and the potential consequences of this breach on the lease terms. The Victorian Civil and Administrative Tribunal (VCAT) was tasked with determining several key legal issues. These included whether the lessee's relinquishment of the liquor licence was due to a wilful breach or an error, the impact of this breach on the lease terms, and the landlord's right to enforce forfeiture given the lessee's previous relief from forfeiture on specific conditions.

The tribunal examined whether the breach was due to a mistake by the lessee or the licensing authority, and if the mistake was material enough to warrant relief from forfeiture. It also considered whether the lessee's failure to remedy the breach of an essential term, coupled with the lease nearing its end, justified the landlord's refusal to renew the lease. Additionally, the court explored whether the previous relief from forfeiture, which included a condition to apply for re-transfer of the licence, rendered the relief futile. The tribunal needed to decide if the landlord was unconscionably enforcing their forfeiture rights and whether the lessee should be granted further relief against forfeiture. The tribunal's reasoning was grounded in the provisions of the Property Law Act 1958 (Vic) and the Liquor Control Reform Act 1998 (Vic).

The tribunal found that the breach of the essential term was wilful and that the lessee's failure to remedy this breach, combined with the lease nearing its end, justified the landlord's decision not to renew the lease. The court also ruled that the previous relief from forfeiture was not rendered futile by the condition of remedying the breach, and that the landlord was not unconscionably enforcing their forfeiture rights. Consequently, the tribunal determined that the lessee was not entitled to relief against forfeiture. The tribunal also concluded that the lease did not fall under the Retail Leases Act 2003 (Vic), thus VCAT did not have jurisdiction over the matter. The final orders of the tribunal were that Lontav Pty Ltd was entitled to possession of the hotel premises from Pineross Custodial Services Pty Ltd.