Perpetual Trustee Company Limited v Eastern Pursuits Pty Limited

In the case of Perpetual Trustee Company Limited v Eastern Pursuits Pty Limited, the plaintiff, Perpetual Trustee Company Limited, sought to recover rental arrears from the defendant, Eastern Pursuits Pty Limited, a lessee operating a hotel and nightclub. The dispute arose during the COVID-19 pandemic, where the operation of the hotel was significantly impacted by the pandemic regulations. The court was tasked with determining whether the parties had negotiated in good faith, as required by the regulations, and whether the landlord had acted in a misleading or deceptive manner by not acknowledging a purported common intention that they would not purchase the lessee's liquor licence.

The primary legal issue before the court was whether the landlord and lessee had negotiated in good faith, as mandated by the COVID-19 regulations. Additionally, the court had to determine whether the landlord's failure to acknowledge a common intention not to purchase the lessee's liquor licence constituted misleading or deceptive conduct, unconscionable conduct, or gave rise to a common intention constructive trust or estoppel. The court also needed to consider whether there was a contractual obligation on the landlord to clarify its intention regarding the purchase of the liquor licence.

The court found that the parties had not negotiated in good faith, as the lessee did not pay any rent and the landlord had made several offers and concessions. The court further held that there was no common intention that the landlord would not purchase the lessee's liquor licence, and the lessee had not established such a common intention. The court determined that the landlord's failure to acknowledge a common intention did not constitute misleading or deceptive conduct, unconscionable conduct, or give rise to a common intention constructive trust or estoppel. The court also found that there was no obligation on the landlord to clarify its intention under the contract, and the lessee had not sought rectification. Consequently, the court ruled in favour of the landlord, allowing the recovery of rental arrears. The court ordered Eastern Pursuits Pty Limited to pay the outstanding rental arrears to Perpetual Trustee Company Limited.