Pioneer Eagle Pty Ltd v Basha

[2025] NSWCATCD 124

Civil and Administrative Tribunal

New South Wales

Medium Neutral Citation:

Pioneer Eagle Pty Ltd v Basha [2025] NSWCATCD 124

Hearing dates:

12 and 13 November 2024
Final submissions 10 February 2025

Date of orders:

12 August 2025

Decision date:

12 August 2025

Jurisdiction:

Consumer and Commercial Division

Before:

G Ulman, Senior Member

Decision:

(1)   The application against the first and third respondents is dismissed.

(2) In the event a party wishes to make a cost submission, it must file and serve a written submission of no more than four A4 pages within 21 days, any written submissions in reply of no more than four A4 pages in length must be filed and served within a further 21 days, and the Tribunal will then make a decision on the papers as permitted by section 50(2) of the Civil and Administrative Tribunal Act 2013, unless persuaded that there should be oral submissions.

(3)   If no costs submissions are filed and served within the time specified in the preceding order, then the order of the Tribunal is that the applicant pay the first respondents’ costs of and incidental to the proceedings.

(4)   A copy of these reasons is to be sent to the third respondent, care of the second respondent’s business address, 359-361 Concord Road, Concord West, NSW 2138.

Catchwords:

Retail Lease – jurisdiction - permitted use of the premises is “massage and beauty” - whether the use of the premises is a prescribed business under the Retail Leases Act – what is the predominant use of the premises

Legislation Cited:

Retail Leases Act 1994

Cases Cited:

Diamond Certification Laboratories Ply Ltd v The Trust Company Pty Ltd (2015) NSWCATAP 122
Honings Bakery Pty Ltd v Cerialis Ply Ltd [2014] NSWCATCD 87
Targeted Property Investments Pty Ltd v Look Up Technologies Pty Ltd [2022] NSWCATAP 318
Robin Raju & Associates PL v Kaplan Investments PL [2021] NSWCATCD 90

Category:

Principal judgment

Parties:

Pioneer Eagle Pty Ltd – Applicant
Peter Basha, Renee Basha – First respondents
Emma Matiuzzo – Third Respondent

Representation:

Mr M Playford, solicitor - Applicants
Ms B Kennedy, barrister – First Respondents
No appearance by or on behalf of the Third respondent
Solicitors:
Macquarie Playford Lawyers. – Applicants
Memcorp Lawyers – First respondents

File Number(s):

202300377884

Publication restriction:

Nil

REASONs FOR DeCISION

Introduction

1. The applicant in these proceedings is the former lessee of a shop at [address] Concord West (premises). It occupied the premises under a lease that commenced on 31 January 2022, and which prematurely came to an end on 1 March 2023 (lease) when the applicant sold the business being conducted from the premises.

2. Ms Na Kang (Ms Kang) is the sole director and shareholder of the applicant.

3. Mr Peter Basha (Peter Basha) and his wife, Mrs Renee Basha, are the first respondents and the owners of the premises. Unless the context otherwise requires, I will refer to them as the “first respondents.”

4. Until March 2023, Exclusive Residential Real Estate Pty Ltd, the second respondent, managed the premises for the first respondents. On 30 May 2024, an order was made dismissing the application as against the second respondent on the basis that the applicant had withdrawn the application.

5. The third respondent, Ms Emma Matiuzzo, was at all relevant times an employee of the second respondent. On 8 September 2023, the Tribunal made a number of orders, including an order that the third respondent be joined as a respondent in the proceedings. The reason given was that the applicant maintained that it had a cause of action against the third respondent under the Retail Leases Act 1994 (RL Act). There was no appearance by or on behalf of the third respondent at the hearing.

6. The applicant claims a total of $31,283.99 from the first and third respondents for alleged breaches of the lease and the RL Act. The amount claimed is comprised of the following:

(1)	Return of a security deposit	$13,585.00
(2)	Refund of outgoings paid from 26 January 2022 to 1 March 2023	$7,944.31
(3)	Damages for lost opportunity	$4,754.68
(4)	General and/or exemplary damages	$5,000

7. The first respondents deny any liability to the applicant. They also say that the Tribunal does not have jurisdiction to determine the applicant’s claim as the applicant’s use of the premises was not one of the prescribed businesses found in Schedule 1 of the RL Act at the time the lease commenced.

Background

8. The first respondents purchased the premises in January 2009. The premises were, at the time, leased as a newsagency. Peter Basha personally managed the leasing arrangements directly with the tenant.

9. Due to their advancing age and health issues, in November 2021, the first respondents engaged the second respondent to manage the premises and locate a new tenant. The third respondent was responsible for managing the premises on a day-to-day basis.

10. Mr Paul Basha (Paul Basha), the first respondents’ son, has held his parents’ power of attorney since 29 March 2023. For a number of years prior to that, he was the contact for the first respondents in dealings with the premises. He still remains in that role.

11. In November 2021, negotiations for a lease of the premises took place between Ms Kang and the third respondent. Ms Kang was apparently negotiating the lease for MDZ Management Services Pty Ltd (MDZ). According to Ms Kang, MDZ is her friend’s company.

12. On 8 December 2021, a disclosure statement and draft lease were sent by Mr James Dahdah (Mr Dahdah), then with JD Law Group Pty Ltd, the first respondents’ solicitors, to Mr Darren Gaun (Mr Gaun) at Legaland Associates, who acted for MDZ. Ms Kang had retained Mr Gaun as he was a Chinese-speaking solicitor. In both the disclosure statement and the lease, MDZ was the named lessee.

13. Mr Dahdah is now a director principal with Memcorp Lawyers and the solicitor for the applicant in these proceedings.

14. On 13 January 2022, Mr Gaun sent an email to Mr Dahdah requesting that the lessee’s name be replaced with the applicant’s name and that the lease commence on 31 January 2022. In the email, he informed Mr Dahdah that Ms Kang was the applicant’s sole director and secretary.

15. The lease was subsequently reissued by Mr Dahdah with the applicant as the lessee and Ms Kang as the guarantor of the applicant’s obligations under the lease. A fresh disclosure statement with the applicant named as the lessee was not issued.

16. The lease has been signed by the first respondents and by Ms Kang on behalf of the applicant. Ms Kang has also signed as the guarantor.

17. The first respondents have not signed the copy of the disclosure statement that is in evidence. Ms Kang has signed Part 12 and Schedule 2 of the disclosure statement on behalf of the lessee. The date 25 January 2022 has been handwritten in both places where Ms Kang has signed the document. There are handwritten amendments to various dates in the document. Adjacent to each of the amendments are handwritten initials. As Ms Kang is the only one who has signed a document, I will assume that they are her initials.

18. Part A, key disclosure item 5 reads: total estimated outgoings and promotion and marketing costs for the lessee in year 1. The box adjacent to that item reads “$0.00.”

19. Part A5 of the disclosure statement is headed “Outgoings.” Item 13.1 reads: “Is the lessee required to pay or contribute to the lessor’s outgoings?” The “yes” box is ticked. Item 13.2 reads: “Describe any period during which the lessee is not required to pay outgoings.” The box below contains the words “Not applicable.” Item 13.3 reads: “Date on which payment of outgoings is to commence. The amended date below is 31 January 2022.” Item 13.4 reads “Formulae for apportioning outgoings.” The box immediately below contains the figure “100%.”

20. Item 14.1 to 14.12 of the disclosure statement then lists a number of outgoings. In each box adjacent to the items in 14.1 to 14.12 appears “$0.00.”

21. Item 14.15 of the disclosure statement reads: “Formula for determining lessee’s share of the total outgoings for the building/centre.” The figure “100%” appears in the box below.

22. Item 14.16 reads: “Estimated lessee contribution to outgoings.” In the box adjacent to the item appears “$0.00.”

23. The lease provides for a three-year term commencing 31 January 2022 and terminating on 30 January 2025. There are two options, each of three years.

24. The commencement rent in year one was $54,340, including GST, to be paid by equal monthly instalments of $4528.33, inclusive of GST (item 13 of annexure A to the lease).

25. Item 14 in annexure A is headed outgoings and reads as follows:

A. Share of outgoings 100%

B. Outgoings –

1. water rates and usage

2. council rates

3. building insurance

4. GST

5. smoke detector, fire safety with regular checks/annual certification fee

for the landlord the building of which the property is part, fairly apportioned to the period of this lease.

26. The permitted use of the premises is described in item 17 of annexure A as “Massage and Beauty.”

27. Item 20 of annexure A specifies a “security deposit” of $13,585 the applicant is required by clause 17 of the lease to provide before the lease commences. Clause 17.3 provides that the lessor is entitled to deduct from the security deposit an amount equal to any moneys due but unpaid by the lessee to the lessor under the lease. Clause 17.4 provides that the security deposit will be held in accordance with section 16C of the RL Act.

28. It is not in dispute that the security deposit was paid by the applicant to the second respondent on 26 January 2022 and that it was only remitted by the first respondents to New South Wales Fair Trading on 14 April 2023. Ms Kang asserts that the signature purporting to be her signature on the Bond lodgement form is a forgery.

29. With the first respondents’ consent, the premises were renovated by the applicant before the commencement of the lease. On 25 November 2021,Tong Xie, Head of Strategy at Luton Design, sent the third respondent an email informing her that Luton Design had been nominated as the interior design firm for the premises and enclosing a concept and layout design for “Concord West Massage.” The subject line of the email reads: “CDC _ Concore West Massage _ 331 Concord Rd Concord West NSW”. In the email, Tong Xie asks for the owner’s consent to an attached CDC (complying development certificate) application form. The signed CDC was returned the same day, 25 November 2021.

30. The concept plans identify the project name as Massage Shop @ Concord West and the address of the premises. The proposed concept layout depicts three separate rooms with what appears to be a massage table in each, and a new graphics sign at the front entrance to the premises adjacent to the counter area bearing the name “Concord West massage.” The email and plans are contained in the applicant’s bundle of documents.

31. At 10.00 am on 28 February 2023, the third respondent sent an email with a section 129 notice to the email address that is designated in the lease as the email address for the guarantor, Ms Kang. For convenience, I will from now on refer to it as the “Kang email address.” The notice states that rent payments were overdue, and the amount in arrears was $5841.94.

32. The salutation in the body of the third respondent’s email is “Dear Mindan”, the name Mindan being part of the Kang email address. Later emails from the third respondent that were sent to the same email address associate the email address with the names “YOYO SZK” and “Mindan Zheng”. It has not been explained who Mindan or Yoyo are or their relationship with Ms Kang, or indeed whether they are all the same person. In the end, this mystery does not, in my view, affect the outcome of these proceedings.

33. Between 28 February 2023 and 2 March 2023, the following email exchange took place between YOYO SZK using the Kang email address and the third respondent. For convenience, I will refer to this sender as “Yoyo.”

1. 4:46 PM 28 February 2023 Yoyo to third respondent:

Dear Emma

I am seeking some advice on the procedures we need to follow to transfer the business ownership My business partner and I have decided to change the ownership over to a new owner because I am planning to travel overseas, and my business partner is pregnant and won’t have time to manage the business. We would like to transfer the business over to a new manager and need to find out what this process is, please.

Thanks

Best Regards

2. 5:00 PM 28 February 2023 email from Yoyo (The addressee’s email is not included, but it was most likely an email sent to the third respondent.)

Yes, the new owner will take over the shop from 1st of March.

3. 1 March 2023 Third respondent to Yoyo

Yoyo you can not just sell your business without the owner knowing who they are first and making that they are financially viable to take on the current lease. The owner has instructed that there will be no new owners to the business until invoices are paid in full and the rent is up to date.

Best regards, Emma

4. 2 March 2023 email from Yoyo to third respondent

Hi Emma

We will introduce new buyer to owner. She is one of our business partner at top Ryde shop, therefor, her financial is definitely able to afford current rental and she also agree to pay current rental amount.

New buyer will pay the rent and building insurance. I will pay rest of the invoice in full by Saturday.

Thanks Best regards

5. 2 March 2023 email from third respondent to Yoyo

yoyo it doesn’t work that way you need to pay the rent now as you still in a lease.

the new business owner needs to fill in the following document and provide the following documents, and if all approved the lease has to be assigned to her and you then have to surrender the lease. We need her photo id, bank statement and work and business history.

Best regards,

34. On 1 March 2023, the applicant sold the business it was conducting from the premises to a third party and vacated the premises. The first respondents say that the applicant abandoned the lease without notice to them.

35. The third respondent and Paul Basha attended the premises about 4 March 2023 to lock out the applicant due to the unpaid amounts owing to the first respondents. They were told by a person at the premises that he had purchased the business from the applicant and that he was now the owner. According to Paul Basha, the husband of the owner agreed to pay all outstanding rent and outgoings owed by the applicant, which at the time amounted to $8500.58. The amount was paid on 6 March 2023.

36. Later in March 2023, the first respondents terminated the management agreement with the second respondent. Since then, Paul Basha has managed the leasing of the premises.

37. On 16 March 2023, Paul Basha lodged a claim for the applicant’s security bond with New South Wales Fair Trading. The sum of $13,585 was released to the first respondents who applied it in part payment of the cost of electrical work at the premises, which is said to have cost $16,280. They say that work was required to rectify the electrical work undertaken by the applicant.

38. In a letter dated 21 March 2023 sent to the first respondents’ solicitors, Mr Playford, on behalf of the applicant, made a demand for a refund of $7053.68 for outgoings paid and for the return of the security deposit of $13,585, a total of $20,613.68. The basis for the demand is that the first respondents failed to provide the applicant with a disclosure statement, a NSW tenancy guide and a written estimate of outgoings payable.

39. Mr Playford filed the applicant’s points of claim with the Tribunal on 16 October 2023. Consisting of 27 pages, the applicant makes various allegations about the first respondents’ conduct and pleads multiple causes of action that are said to give rise to claims for the monetary amounts being claimed. In summary, the applicant makes the following allegations:

1. The first respondents claimed undisclosed outgoings in breach of sections 12A, 12A(1), and 12A(4) of the RL Act.

2. The first respondents failed to provide written outgoing statements and notices as prescribed by the RL Act, and no outgoing estimates were ever given to the applicant in the disclosure statement.

3. The security bond was not lodged with the Secretary within 20 days after the lease was signed as required by section 16C(1), (2) and (3) of the RL Act.

4. In breach of clause 7 of the lease, the respondents failed to respond to the applicant and repair damage when the premises’ power points were damaged by a storm, which resulted in the applicant suffering a loss of opportunity to trade and generate profit.

5. The respondents use the incorrect address for service of notices as was prescribed in the lease.

6. One or more of the respondents forged the signature of Ms Kang on the Retail Bond Lodgement Form dated 27 March 2023, which was sent to the Retail Bond Board with the security deposit.

7. The respondents deliberately and knowingly gave an incorrect address for service of notices on the applicant in the retail bond lodgement form, and, consequently, the applicant never received any notices that the first respondents were claiming the bond.

40. The applicant seeks the following orders:

1. An order pursuant to section 72 (1)(f)(i) that item 14 and clause 5 of the lease in relation to payment of outgoings be declared void.

2. An order for recovery from the first respondents of any amount paid to them that the applicant was not liable under sections 12A, 12A (1), and 12A(4) of the RL Act.

3. An order that the first respondents pay reasonable compensation for misleading statements/representations pursuant to section 10 of the RL Act.

4. An order pursuant to section 72(1)(b) of the RL Act that no money was due by the applicant to the first respondents under the lease for outgoings, GST for outgoings, any outgoings contribution and a reduction in rent due to the applicant not being able to use 100% of the lease premises due to unrepaired damage.

5. Damages pursuant to section 62E of the RL Act for misleading or deceptive conduct in contravention of section 62D. Alternatively, damages pursuant to section 236 of the Australian Consumer Law for misleading or deceptive conduct in contravention of section 18 and/or section 30 (1) (g) of the Australian Consumer Law.

6. An order pursuant to s 71(A)(1) of the RL Act in relation to unconscionable conduct in contravention of part 7A s 62(B) of the RL Act.

7. Compensation for disturbance under section 34 of the RL Act.

8. An order under section 72(AA)(1) and section 72(A)(1) of the RL Act, whether by way of debt, damages, for interest, restitution or refund of money paid to the applicant.

9. A declaration that the applicant is entitled to receive payment of the whole of the security bond.

10. Damages for breach of lease.

11. An order and penalty for breaches pursuant to section 9 and section 11 of the RL Act.

12. Interest pursuant to section 100 of the Civil Procedure Act 2005.

13. Costs

41. The first respondents’ points of defence were filed on 16 November 2023. Suffice it to say, the first respondents deny any liability for the amounts claimed. The jurisdiction of the Tribunal to hear and determine the applicant’s claim was not raised in the points of defence.

Hearing and evidence

42. The hearing was conducted over two days. Mr Playford appeared for the applicant, and Ms Kennedy of counsel appeared for the first respondent.

43. The applicant’s evidence consisted of two affidavits, affirmed by Ms Kang and dated 7 September 2022 and 22 March 2024, a statement by Mr Ken Chen, a licenced electrician, dated 6 August 2024, a statement by Mr Playford, dated 11 November 2024 and a lever arch folder of various documents (applicant’s bundle).

44. Mr Playford also tendered two exhibits. Applicant’s Exhibit 1 is email correspondence between Paul Basha and the third respondent regarding the section 129 notice. Applicant’s Exhibit 2 consists of the email Mr Dahdah sent to Mr Gaun on 8 December 2021 and Mr Gaun’s email sent to Mr Dahdah on 13 January 2022.

42. The first respondents’ evidence consists of written statements by Paul Basha, Peter Basha, and Charlee Daher (Mr Daher), all dated 12 June 2024. Mr Daher is a licensed electrician.

43. Ms Kennedy tendered one exhibit. It is a one-page printout of the daily rainfall reported by the Australian Government Bureau of Meteorology for 2022.

44. Ms Kang and Mr Chen were cross-examined by Ms Kennedy. Throughout her cross-examination, Ms Kang was assisted by a Mandarin-speaking Tribunal-appointed interpreter who translated the questions and Ms Kang’s answers.

45. Mr Playford did not cross-examine the first respondents’ witnesses.

46. At the conclusion of the hearing, directions were made for the filing of written submissions.

Written submissions

50. Mr Playford filed three written submissions. They are the applicant’s closing submissions filed 10 December 2024, outline of submissions for the applicant filed 15 January 2025, and the applicant’s response submissions filed 10 February 2025.

51. Ms Kennedy’s written submissions on behalf of the first respondents were filed on 17 January 2025.

Ms Kang’s affidavit evidence

52. I consider it important that I make these observations about Ms Kang’s affidavit evidence, as there is a serious question in my mind whether her affidavits truly reflect her evidence.

53. It is not in dispute that English is not Ms Kang’s first language and that her English language skills are minimal. Mr Playford acknowledged this during the hearing when he informed the Tribunal that Ms Kang had significant issues reading and writing English and, as a consequence, engaged Mr Gaun to act for the applicant. In the applicant’s closing submissions, Mr Playford also refers to Ms Kang’s “limited English proficiency” (pages 4 and 5) and “lack of reading and writing English” (page 36). Ms Kang confirmed this lack of proficiency in her 22 March 2024 affidavit, when she said at [25] that “Emma always knew I could not speak, read, write and understand English well…”

54. Having regard to what I have just described, it is a matter of serious concern that, despite her limited command and understanding of the English language, Ms Kang’s affidavits, which are in English, make no mention of having been prepared with the assistance of a Mandarin-speaking interpreter or translated into English. Moreover, anyone without knowledge of Ms Kang’s minimal command of the English language could be forgiven for thinking that the deponent of those affidavits had had a good command of the English language.

55. A no less troubling aspect of Ms Kan’s affidavit evidence is where, in her affidavit of 22 March 2024, she purports to relate in what I would describe as near-perfect English, and in the first person, a conversation Ms Kang says she overheard between Mr Playford and the third respondent on 17 October 2023 in the waiting area of the Tribunal. As just one example taken from the conversation that was said to have taken place between Mr Playford and the third respondent, Ms Kang says this at paragraphs 7 and 8:

I heard Mr Playford ask Emma “We have serious concerns Na Kang’s signature and date has been allegedly forged on the Retail Bond Lodgement Form sent to the NSW Bond Board in April 2023, which is impossible as my client was never asked to come into any office by you or the landlord on 27 March 2023 how can that be.” Mr Playford continued, “The document could only have been allegedly forged by you or the landlord.”

I clearly heard Emma say to Mr Playford “It was me who sent the Retail Bond Lodgement Form. I know your client didn’t sign or date it. I did this because I did not lodge the bond after she paid it to me and I was worried and told to leave it in the real estate company bank account.”

56. I am unable to accept that someone with an extremely poor command of the English language, including an acknowledged inability to understand English, can relate, in the first person, what was said in a conversation that was overheard taking place in English. Accordingly, I reject those parts of Ms Kang’s 22 March 2024 affidavit in which she deposes to the terms of a conversation that is said to have taken place between Mr Playford and the third respondent.

57. As for the remainder of her affidavit evidence, in the absence of it being corroborated by contemporaneous documents, I give it little weight.

Issues

58. There are two issues that need to be determined in these proceedings. First and foremost is a question of whether the Tribunal has jurisdiction to entertain the applicant’s claim. If it does, the second issue is whether the applicant is entitled to the relief that it seeks.

Jurisdiction

59. Not long after the hearing commenced, I raised with Mr Playford and Ms Kennedy whether the Tribunal had jurisdiction to hear the applicant’s claim. I observed that the permitted use of the premises was described in the lease as “massage and beauty”, and that in her affidavit, Ms Kang described using the premises for massage. However, massage or therapeutic massage was not one of the prescribed businesses.

60. The issue of the Tribunal’s jurisdiction has been addressed by the parties in the written submissions filed with the Tribunal, and it is appropriate that I deal with that issue now.

Applicant’s submissions

61. In summary, Mr Playford makes these submissions in support of the contention that the Tribunal has jurisdiction to entertain the applicant’s claim:

1. The premises are a “retail shop” for the purposes of section 3 of the RL Act.

2. The lease expressly states that “beauty and massage” is the permitted use of the premises.

3. The predominant service provided by the applicant was “beauty services”, which is one of the prescribed businesses in Schedule 1 of the RL Act.

4. The correct approach to determining whether the Tribunal has jurisdiction is outlined in Honings Bakery Pty Ltd v Cerialis Ply Ltd [2014] NSWCATCD 87 (Honings).

5. Citing Targeted Property Investments Pty Ltd v Look Up Technologies Pty Ltd [2022] NSWCATAP 318 (Targeted Property) and Diamond Certification Laboratories Ply Ltd v The Trust Company Pty Ltd (2015) NSWCATAP 122 (Diamond), the legal test for determining whether the premises qualify as a “retail shop” does not require a percentage-based analysis of the use but instead considers the predominant use as a whole.

6. Where multiple activities take place on the premises, the Tribunal considers whether those activities are ancillary or auxiliary to a primary prescribed business in Schedule 1(Targeted Properties).

7. The business operated by the applicant was that of a beauty service provider offering ancillary massage services.

8. Of the range of services offered by the applicant, beauty treatments, including waxing, threading, facials, manicures, pedicures, make-up, and skin treatments, constitute over 90% of the services.

9. Facial treatments commonly include facial and scalp massages, beauty salons frequently offer hot stone massage therapy, facial, scalp, head, shoulder, and foot massages as part of relaxation, facials and skincare services. Massage services provided do not constitute a separate business as they are an extension of the primary beauty service as stated in the lease permitted use.

10. The premises were equipped with five treatment rooms, two upstairs and three downstairs, primarily for beauty services, with equipment and layout confirming the predominance of beauty-related activities.

11. A significant portion of the applicant’s clientele consists of individuals seeking beauty services, further establishing that the predominant use aligns with Schedule 1 of the RL Act

12. The premises are located within a retail shopping area, being a cluster of five or more retail shops on Concord Road, a long-recognised retail shopping precinct.

13. The first respondents have not challenged or disputed the Tribunal’s jurisdiction, nor have the first respondents provided any evidence in support of the contention that the Tribunal does not have jurisdiction.

62. In summary, Ms Kennedy makes the following jurisdiction submissions on behalf of the first respondent:

1. The Tribunal’s jurisdiction to determine the applicant’s claim has not been enlivened.

2. A party or former party to a retail shop lease may lodge a retail tenancy claim with the Tribunal (section 71(1) of the RL Act), but the subject lease does not fall within the definition of “retail shop lease” and “retail shop” as prescribed by section 3 of the Act.

3. The correct approach of the Tribunal in determining retail lease jurisdiction was the two-step approach summarised in Honings. As a first step, the Tribunal needs to determine whether the lease clearly defines the use. If it does not, then the next step is to analyse how the premises are actually used to identify the predominant use to ascertain whether that use is one of the prescribed businesses in Schedule 1 of the RL Act.

4. The permitted use was “massage and beauty.” When the lease commenced, Schedule 1 of the RL Act listed beauticians, beauty shops and beauty therapists but not massage services of any kind. Consequently, the Tribunal is required to analyse the manner in which the premises are actually used to identify the predominant use and determine if that use falls within Schedule 1.

5. Contrary to the evidence of Ms Kang, the massage services of the applicant were neither “minor ancillary services” nor did beauty treatments constitute over 90% of the services provided by the applicant.

6. Ms Kang’s oral evidence was that approximately 60% of the business activity conducted at the premises was massage, and there is no direct evidence adduced by the applicant that the beauty services that Mr Playford submits existed were provided at the premises, nor can any inference that they were provided be drawn from the evidence.

7. The applicant’s bundle includes correspondence and plans regarding the proposed renovation work undertaken by the applicant. Those documents have the following features:

1. The title page of the plans is “Concord West massage design concept”;

2. The image of the sign in the front reception area shows “Concord West massage” in large, lit-up letters on the wall;

3. Images showing rooms containing massage tables;

4. The project name, “Massage shop at Concord West”; and

5. A proposed layout which includes a reception waiting area with three rooms containing massage tables with markings for “massage room sliding doors”.

8. None of these documents contains any reference to beauty services in any of the areas set aside for services or to any equipment used for such services.

9. There is no direct evidence before the Tribunal of the number of the applicants’ clientele or the beauty services they were all seeking, or any evidence from which the Tribunal can draw such inferences.

10. Had there been any evidence to corroborate Mr Playford’s submissions, it would be expected to be in Ms Kang’s possession, and the absence of that evidence in her affidavit or in person, and in the absence of any documentation, the submissions as to the beauty services provided by the applicant should not be accepted.

11. The submission that the premises are a retail shop because they carry on a business in a retail shopping centre, as the premises are within a cluster of retail shops, should be rejected. The first respondents only own one shop, and there is no evidence that the strip of shops is being promoted as or generally regarded as constituting a shopping centre or mall or anything to connect them so as to be regarded as such.

Consideration of the jurisdiction issue

63. I should, at the outset, address Mr Playford’s submission that the first respondents have not challenged or disputed the Tribunal’s jurisdiction, nor adduced any evidence in support of the contention that the Tribunal does not have jurisdiction.

64. The fact that jurisdiction was not previously raised by the first respondents prior to the hearing is, in my view, not to the point. The Tribunal cannot ignore the fact that it may not have jurisdiction to grant the orders or relief sought simply because the issue of jurisdiction was not raised. Having raised the matter with the parties, each was given ample opportunity to address the jurisdiction issue in written submissions, which they did.

65. As for the submission that the first respondents have adduced no evidence on the question of jurisdiction, I will simply say that the onus for persuading the Tribunal that it has jurisdiction and the evidentiary burden that goes with it falls squarely on the applicant and not the first respondent.

66. Section 71(1) of the RL Act provides as follows:

A party or former party to a retail shop lease or former retail shop lease may lodge a retail tenancy claim in respect of the lease with the Tribunal for determination of the claim.

67. In other words, for the claimant to make a retail tenancy claim under the Act, the claimant must be either a party or former party to a retail shop lease or former retail shop lease.

68. Section 3 of the RL Act defines “retail shop”, “retail shop lease”, and “retail shopping centre” as follows:

retail shop means premises that-

(a) are used, or proposed to be used, wholly or predominantly for the carrying on of one or more of the businesses prescribed for the purposes of this paragraph (whether or not in a retail shopping centre), or

(b) are used, or proposed to be used, for the carrying on of any business (whether or not a business prescribed for the purposes of paragraph (a)) in a retail shopping centre.

retail shop lease or lease means any agreement under which a person grants to another person for value a right of occupation of premises for the purpose of the use of the premises as a retail shop-

(a) whether or not the right is a right of exclusive occupation, and

(b) whether the agreement is express or implied, and

(c) whether the agreement is oral or in writing, or partly oral and partly in writing.

retail shopping centre means a cluster of premises (not being the stalls in a market) that has all of the following attributes-

(a) at least 5 of the premises are used wholly or predominantly for the carrying on of one or more listed businesses,

(b) the premises are all owned by the same person, or have (or would if leased have) the same lessor or the same head lessor, or comprise lots within a single strata plan under the Strata Schemes Development Act 2015, will

(c) the premises are located in the one building or in 2 or more buildings that are either adjoining or separated only by common areas or other areas owned by the owner of the retail shops,

(d) the cluster of premises is promoted as, or generally regarded as constituting, a shopping centre, shopping mall, shopping court or shopping arcade.

69. Both Mr Playford and Ms Kennedy agreed that the correct approach for determining the use of the premises and whether the Tribunal had jurisdiction is set out in the decision of Senior Member Bluth in Honings. The Senior Member described the steps that need to be taken to determine the question of jurisdiction in these terms:

[36] Both Counsel submitted to the Tribunal that the approach to be taken by the Tribunal in determining whether there is a “retail tenancy dispute” over which it has jurisdiction is well established and is set out in Wood & Wilson v Bergman [2003] NSWADT 82 and Moweno Pty Limited v Stratis Promotions Pty Limited (2002) NSWSC 1151 approved by the Court of Appeal in (2003) NSWCA 376.

[37] In summary it is as follows:

1. firstly, one looks at the lease to see what is the permitted or agreed use of the premises;

2. If the agreement clearly defines what the use of the premises is to be, then the question as to whether or not the premises are a “retail shop” under s 3 of the RL Act will be determined as to whether or not that use appears in Schedule 1;

3. If the permitted or agreed use is not clear or is uncertain, or the use covers a number of different types of businesses, some of which are, or may be, within Schedule 1 described businesses, then an analysis is required of the actual use of the premises to determine whether the predominant use(s) fall within one or more of the businesses prescribed in Schedule 1.

70. The permitted use of the premises, as described in the lease, is “massage and beauty.” It is not “beauty and massage” as submitted by Mr Playford.

71. “Massage” is not one of the businesses prescribed in Schedule 1 of the RL Act at the time the parties entered into the lease. “Beauty shops” and “Beauty therapists” are listed in both schedules. Given that “massage” is not in the schedule, and the descriptor “beauty” is ambiguous and does not assist in determining the actual use of the premises, an analysis of the actual use is required to determine whether the predominant use of the applicant’s business falls within one or more of the prescribed businesses in Schedule 1.

72. Having considered the evidence and the submissions made by Mr Playford and Ms Kennedy, the decision I have come to is that the predominant use of the premises is “massage” and not “beauty shop” or “beauty therapist.” The use of the premises by the applicant was therefore not one of the prescribed businesses listed in Schedule 1 of the RL Act at the time the parties entered into the lease. These are my reasons for reaching that decision.

73. There are several factors which, when taken together, overwhelmingly in my view point to massage being the predominant use of the premises.

74. Firstly, there is Ms Kang’s oral evidence. During the hearing, I asked Ms Kang approximately what percentage of the business was massage and what percentage of her business was beauty. Her answer was 60% was massage and 40% beauty.

75. Mr Playford has submitted that the decisions in Targeted Property and Diamond stand for the proposition that a percentage-based analysis of the use is not required, but instead the legal test for determining whether the premises qualify as a “retail shop” is consideration of the predominant use as a whole.

76. The Appeal Panel in Targeted Property did not decide that a percentage-based analysis of use was not required to determine whether the premises qualify as a “retail shop”. The Tribunal at first instance found that the evidence supported jurisdiction under the Act without the need to consider the percentage of users, and this was accepted by the Appeal Panel. The Appeal Panel also made this observation at [13]:

At [17] the Tribunal referred to the decision in Robin Raju & Associates PL v Kaplan Investments PL [2021] NSWCATCD 90 (Robin Raju) in which it was said that the “predominant” use means the “most conspicuous or effective portion of the use” and that a specific percentage figure is not determinative other than the use must be more than 50% to predominate.

77. The Appeal Panel did not take issue with what was said in Robin Raju.

78. The decision by the Appeal Panel in Diamond also does not assist Mr. Playford’s submission. There was no consideration by the Appeal Panel as to whether or not a percentage-based analysis was appropriate. The principal issue was whether the premises constituted a retail shop as defined in section 3 of the RL Act or a business. The facts of that case are distinguishable from the present proceedings.

79. Second, there is Ms Kang’s affidavit evidence. In her 22 March 2024 affidavit, Ms Kang said this:

[76] On page 6 on the lease no 21 Development Application for Use, it states I must obtain DA approval for a church worship hall, this has always confused me and I have never understood this clause in the lease, I told Emma from the beginning of negotiations that the use will be remedial massage and I showed Emma my certificate diploma of remedial massage…

[89] Losing 3 working massage rooms upstairs was a huge and significant inconvenience and loss for the business…

80. Third, there are the contemporaneous renovation documents in the applicant’s bundle contained in the section marked “Approved Works & Emails”, the references to “massage” to which Ms Kennedy has drawn attention in her submissions, and to which I have referred in paragraph 30 above. The word “beauty” is not to be found in any of those documents.

80. Fifth, Mr Ken Chen, the applicant’s electrician, said in his statement that he was contacted in late 2022 by Ms Kang about undertaking electrical work on the first floor of the lease premises. In paragraph 2 of the statement, Mr Chen sets out the nature of the work Ms Kang said she required an electrician to undertake at “her Remedial massage centre at 331 Concord Road, Concord West…”

81. Fifth, there is no evidence whatsoever to corroborate the submissions made by Mr Playford or explain the basis for them that:

1. the applicant was a beauty service provider and it was offering ancillary massage services;

2. 90% of the services offered were in the nature of beauty services as distinct from massage, or that facial treatments commonly include some form of facial, scalp and head massage;

3. that massage services provided do not constitute a separate business because they are an extension of the primary beauty service, as stated in the permitted use in the lease;

4. five treatment rooms were primarily used for beauty services. At least three of those rooms were used for massage services, as stated by Ms Kang in her 22 March 2024 affidavit and as depicted in the Luton Design concept drawing; or

5. a significant portion of the clientele consists of individuals seeking beauty services.

83. Sixth, Mr Playford’s submission that the premises are located within a retail shopping area, being a cluster of five or more retail shops, is uncorroborated by any evidence. The evidence only discloses that one shop, the subject premises, is owned by the first respondents. There is no evidence that the first respondents owns any other premises which together with the subject premises comprise a cluster of premises with attributes of what would be commonly regarded as constituting a shopping centre, shopping mall, shopping court or shopping arcade as prescribed in section 3 of the RL Act.

84. Senior Member Sarginson (as the Deputy President then was) in Robin Raju said this in considering whether a particular use came within any of the prescribed businesses set out in Schedule 1 of the RL Act:

[34] In this matter, because the permitted or agreed use involves a type of use that are outside the scope of Schedule 1 of the RL Act (function centre) and a type of use that is within Schedule 1 (restaurant), the Tribunal must consider the evidence regarding the actual use of the premises.

[35] Further, “predominant” use is the “most conspicuous or effective portion of the use”. A specific percentage figure is not determinative, other than the use must be more than 50% to predominate (Hardcore Gym Pty Ltd v Police Citzens Youth Club Ltd [2014] NSWCATCD 249 at [15]-[17]).

85. I respectfully agree that a percentage figure is not determinative of the use; other factors also need to be taken into account in coming to a conclusion on the predominant use. By her own admission, Ms Kang, the applicants sole director and shareholder, said in evidence that massage represented 60% of the applicant’s business. Of itself, that means the predominant use of the premises was “massage.” However, the additional evidence to which I have referred and which consists entirely of the applicant’s evidence, only reinforces the conclusion that the predominant use of the premises was massage and not beauty. To adopt the words in Robin Raju, massage was the “most conspicuous or effective portion of the use” of the premises.

86. Accordingly, I find that the premises are not a retail shop as defined by section 3 of the RL Act, as the premises were not wholly or predominantly used for carrying on one or more of the businesses prescribed in Schedule 1 of the RL Act when the parties entered into the lease. Consequently, the applicant’s claim is not a retail tenancy claim for the purposes of the RL Act, and the Tribunal therefore does not have jurisdiction to entertain it.

87. Given the Tribunal’s finding, it is not necessary to consider the various monetary claims made by the applicant. The application against both the first and third respondents will therefore be dismissed.

Costs

88. The first respondents sought the dismissal of the applicant’s claim, and it was successful. The first respondents want to be heard on the question of costs.

89. For the benefit of the parties, and subject to anything they may wish to say, it is my preliminary view that the first respondents are entitled to an order for costs on the basis that they have been successful and that Rule 38 of the Civil and Administrative Tribunal Rules 2014 applies.

90. The third respondent has not taken any part in these proceedings as a respondent either personally or through solicitors. In those circumstances, it is my preliminary view that the third respondent is not entitled to an order for costs.

91. The orders will provide for the parties to make submissions on the question of costs, but if no submissions are filed, costs will follow the event.

Orders

92. These are the orders of the Tribunal:

1. The application against the first and third respondents is dismissed.

2. In the event a party wishes to make a cost submission, it must file and serve a written submission of no more than four A4 pages within 21 days, any written submissions in reply of no more than four A4 pages in length must be filed and served within a further 21 days, and the Tribunal will then make a decision on the papers as permitted by section 50(2) of the Civil and Administrative Tribunal Act 2013, unless persuaded that there should be oral submissions.

3. If no costs submissions are filed and served within the time specified in the preceding order, then the order of the Tribunal is that the applicant pay the first respondents’ costs of and incidental to the proceedings.

4. A copy of these reasons is to be sent to the third respondent, care of the second respondent’s business address, 359-361 Concord Road, Concord West, NSW 2138.   

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I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.

Registrar

Decision last updated: 27 October 2025