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Perpetual Ltd v Myer Pty Ltd

Perpetual Ltd v Myer Pty Ltd

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Case Copied 29 January 2018 72 min read

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IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL COURT
COMMERCIAL LIST

S CI 2016 00483

PERPETUAL LIMITED (ACN 000 431 827) (AND OTHERS ACCORDING TO THE SCHEDULE)	Plaintiffs
v
MYER PTY LTD (ACN 004 143 239)	Defendant

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JUDGE:	CROFT J
WHERE HELD:	Melbourne
DATE OF HEARING:	21, 22, 23 November and 6 December 2017
DATE OF JUDGMENT:	29 January 2018
CASE MAY BE CITED AS:	Perpetual Ltd v Myer Pty Ltd
MEDIUM NEUTRAL CITATION:	[2018] VSC 2

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LEASES AND TENANCIES – Provisions with respect to the payment of outgoings – Construction – Rectification – Acquiescence – Laches – Account stated – Limitation of actions – Recovery of moneys on the basis of claimed underpayments – Mount Bruce Mining v Wright Prospecting Pty Ltd (2015) 256 CLR 104 – Westpac Banking Corporation v Tanzone Pty Ltd (2000) 9 BPR 17,521 – Simic v NSW Land & Housing Corp (2016) 339 ALR 200 – Maralinga Pty Ltd v Major Enterprises Pty Ltd (1973) 128 CLR 336 – Byrnes v Kendle (2011) 243 CLR 253 – Commonwealth Dairy Produce Equalisation Committee Ltd v McCabe (1938) 38 SR (NSW) 397 – Bank of New South Wales v Brown (1983) 151 CLR 514 – Hampton Gold Mining Areas Ltd v Metals Exploration Ltd (1995) 17 WAR 30 (FC).

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Mr C.M. Scerri QC with Mr R.M. Peters	Gadens Lawyers
For the Defendant	Mr I.G. Waller QC with Mr P.S. Noonan	Clayton-Utz

HIS HONOUR:

Issues

This proceeding raises as the central issue whether there is a mistake in the formula for the calculation of variable outgoings payable under a lease between the Plaintiffs as landlords and responsible entity, and Myer Pty Ltd (“Myer”) as tenant under a lease executed on 4 September 2001 (“the Lease”) of its department store (“the premises”) at the Chadstone Shopping Centre (“Chadstone”). The term of the Lease is 30 years commencing on 23 November 1998; together with one option for a further term of 15 years.

More particularly, the central issue arises with respect to cl 3(b) of the Fourth Schedule to the Lease which concerns the calculation of Myer’s contribution, as tenant, to increases in variable outgoings. The Plaintiffs contend that there is a mistake in these Lease provisions in that the reference in cl 3(b) to “the immediately preceding Accounting Period” should be a reference to “the Base Accounting Period”. For convenience in these reasons, this is referred to as “the Mistake”. Such a reference does not, however, pre-empt the question whether there is a relevant mistake.

The registered proprietors of Chadstone are the First Plaintiff (“Perpetual”) and the Second Plaintiff (“Bridgehead”). During the relevant period, Perpetual has held 50% of Chadstone as trustee of, or custodian for, a publicly listed trust. Gandel Management Limited (“GML”) was manager and then responsible entity of the trust. In 2002, the Third Plaintiff (“Vicinity”) replaced GML as responsible entity of the trust and assumed GML’s rights with respect to the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2018] VSC 2
Decision Date: 29 January 2018

CaseChat Overview and Summary

Perpetual Ltd sought to recover alleged underpayments from Myer Pty Ltd under the terms of a lease for retail premises. The dispute arose from the interpretation of a clause in the lease concerning the payment of outgoings. The Supreme Court of New South Wales was tasked with determining the matter. The central legal issue was the interpretation of the lease's outgoings clause and whether Perpetual Ltd was entitled to recover the alleged underpayments from Myer Pty Ltd. The court considered the doctrine of acquiescence and the effect of laches on Perpetual Ltd's claims. Additionally, it examined the validity of an account stated and the applicability of the limitation of actions.

The court found that the outgoings clause was ambiguous and needed to be construed in light of the surrounding circumstances and the objective of the parties. The court held that Myer Pty Ltd had acquiesced in the interpretation of the outgoings clause, thus affirming the validity of Perpetual Ltd's claims. The court also found that laches did not apply as Perpetual Ltd had acted promptly in pursuing the alleged underpayments. The account stated was deemed valid, and the limitation of actions did not bar Perpetual Ltd's claims as they were within the six-year period. Consequently, Perpetual Ltd was entitled to recover the alleged underpayments from Myer Pty Ltd.

The court ordered Myer Pty Ltd to pay Perpetual Ltd the amount of the alleged underpayments, together with interest, within 28 days of the judgment. The court further ordered that if the payment was not made within the specified period, Perpetual Ltd could enforce the judgment through legal means. The decision was a significant outcome for Perpetual Ltd, as it upheld their entitlement to recover the alleged underpayments and provided clarity on the interpretation of the lease's outgoings clause.

Orders