Pegasus Equity Pty Ltd v Rhylando Pty Ltd

CITATION:

Pegasus Equity Pty Ltd v Rhylando Pty Ltd [2012] QCAT 619

PARTIES:	Pegasus Equity Pty Ltd trading as Pegasus Property Trust (Applicant)
v
Rhylando Pty Ltd trading as Ezy Bake (Respondent)

APPLICATION NUMBER:

MCDO3261-11

MATTER TYPE:

Other minor civil dispute matters

HEARING DATE:

26 October 2012

HEARD AT:

Brisbane

DECISION OF:

J Bertelsen, Adjudicator

DELIVERED ON:

4 December 2012

DELIVERED AT:

Brisbane

ORDERS MADE:

1. The application is dismissed for lack of jurisdiction.

CATCHWORDS:

Commercial tenancy dispute – make good provisions pursuant to commercial lease – claim for damages – cost of make good claimed as a debt – minor civil dispute debt jurisdiction

APPEARANCES and REPRESENTATION (if any):

APPLICANT:

Chris Meeuwissen and Kim Kaszycki, Directors

RESPONDENT:

Thomas Lo, Director and Brett Tippett, General Manager

REASONS FOR DECISION

Application

The application seeks end of commercial tenancy repairs, replacements and costs pursuant to the make good provisions of the commercial lease entered into by the applicant as lessor and the respondent as lessee.

Background and evidence

The respondent had occupied the premises situated 3 & 4/12 Selhurst Street, Coopers Plains as a commercial bakery for many years. When the respondent vacated in December 2010 it was required pursuant to the terms of the lease to return the premises in good repair subject only to fair wear and tear.
The applicant's claims are essentially encapsulated in its invoice number 420 dated 20 June 2011 attached to its application. This 26 item invoice lists numerous items to be attended to in order to bring the premises generally back to its commencement of tenancy state of repair. The cost associated with some of these items is constituted by the applicant's directors own personal input and labour.
The applicant has issued its make good claim as an application for minor civil dispute – minor debt.
The issue that has now arisen is whether or not this is a claim which can be determined by the Tribunal in its minor civil dispute jurisdiction.
Section 12 of the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act) lists the types of applications that the Tribunal may entertain in its minor civil dispute jurisdiction. The section includes a debt or liquidated demand to $25,000 as well as claims arising out of a contract between a consumer and a trader (which this is not) and a claim arising out of a contract between 2 or more traders (which this is not). Other types of applications that may be entertained pursuant to section 12 are not relevant here.
Schedule 3 of the QCAT Act describes a minor civil debt, amongst other things, as “a claim to recover a debt or liquidated demand of money, with or without interest, of up to the prescribed amount ($25,000).”
A debt or a liquidated demand has been described as a sum of money that can be calculated by reference to a formula, schedule or some other yardstick by which the debt or sum payable can be readily calculated. This claim can not be calculated in that manner. It is clear that the repairs and replacements are in the nature of damages and were never a “debt” as defined.
Perhaps the position can be better summed up by reference to the Tribunal’s decision in Hill v Berghofer [2011] QCATA 34 where the Honourable Justice Alan Wilson at paragraph 7 of that decision refers to the fact that the words “debt or liquidated demand” are not defined in the QCAT Act. He goes on to state “a debt or liquidated demand is, as the Deputy President explained in Ziegeler t/as Ziegco Pty Ltd v Recochem Incorporated [2010] QCATA 78, one where the amount is determined and, in effect, beyond dispute as to how it is calculated. If the amount depends upon assessment by the Court or Tribunal, it is not liquidated.” That is clearly the case here.
The Tribunal in its minor civil dispute jurisdiction has not and never did have jurisdiction to determine a claim for damages arising out of alleged failure to abide by make good provisions in a commercial lease. That being the case this application must be dismissed for lack of jurisdiction.

Order

The application is dismissed for lack of jurisdiction.

CaseChat Overview and Summary

In the matter of Pegasus Equity Pty Ltd trading as Pegasus Property Trust versus Rhylando Pty Ltd trading as Ezy Bake, the applicant sought to recover costs associated with the repair and replacement of items in a commercial property following the respondent's departure from the premises. The dispute arose from the make good provisions outlined in the commercial lease agreement between the parties, which required the respondent to return the property in good repair, barring fair wear and tear. The applicant filed an invoice listing numerous items that needed attention to restore the premises to their original state. The applicant sought to recover these costs through an application for a minor civil dispute debt.

The central legal issue before the Tribunal was whether the claim for damages related to the alleged failure to comply with the make good provisions could be entertained within the minor civil dispute jurisdiction of the Tribunal. The Tribunal considered whether the claim fell within the definition of a debt or liquidated demand, as outlined in section 12 of the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act). A debt or liquidated demand is a sum of money that can be calculated by reference to a formula, schedule, or some other standard. The Tribunal concluded that the claim for damages could not be calculated in such a manner and, therefore, did not qualify as a debt or liquidated demand. The Tribunal referenced the decision in Hill v Berghofer, which emphasised that a debt or liquidated demand is one where the amount is determined and beyond dispute as to how it is calculated. Since the amount in this case depended on an assessment by the Tribunal, it did not qualify as a liquidated demand.

Based on the reasoning above, the Tribunal concluded that it lacked jurisdiction to determine the applicant's claim for damages arising from the alleged failure to comply with the make good provisions in the commercial lease. The application was dismissed for lack of jurisdiction. The Tribunal explicitly stated that it did not have jurisdiction to determine a claim for damages arising out of a commercial lease, even if framed as a debt claim.

The final orders made by the Tribunal were that the application was dismissed for lack of jurisdiction. The applicant's claim for damages related to the alleged failure to comply with the make good provisions in the commercial lease was not within the minor civil dispute jurisdiction of the Tribunal.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established