Sazzi (SA) Pty Ltd v Chang - [2015] SASCFC 96

SUPREME COURT OF SOUTH AUSTRALIA
(Full Court)
SAZZI (SA) PTY LTD v CHANG & ORS
[2015] SASCFC 96
Judgment of The Full Court
(The Honourable Justice Gray, The Honourable Justice Kelly and The Honourable Justice Peek)
3 August 2015
APPEAL AND NEW TRIAL - APPEAL - GENERAL PRINCIPLES - POINTS AND OBJECTIONS NOT TAKEN BELOW - WHEN NOT ALLOWED TO BE RAISED ON APPEAL - COURSE OF CONDUCT AT TRIAL - GENERALLY
APPEAL AND NEW TRIAL - APPEAL - GENERAL PRINCIPLES - POINTS AND OBJECTIONS NOT TAKEN BELOW - WHEN NOT ALLOWED TO BE RAISED ON APPEAL - QUESTIONS NOT RAISED ON PLEADINGS OR IN ARGUMENT - GENERALLY
LANDLORD AND TENANT - TERMINATION OF THE TENANCY - FORFEITURE - GENERALLY
The appellant was the tenant of commercial premises being used as a restaurant. The respondents were the landlords. The parties executed a written agreement to lease and a written memorandum of lease. The lease commenced on 1 October 2006. Prior to entering into the lease, the appellant paid funds to the respondents in respect of a debt owing to the respondents by the previous tenant, to whom the appellant was indebted. Soon after the lease commenced, the appellant’s payments for rent and outgoings fell into arrears. On about 13 May 2007, the appellant ceased trading at the premises and opened another business elsewhere. The appellant claimed to have entered into an agreement to sell the business, including some plant and equipment, to a third party. The respondents claimed that they did not authorise any assignment of the lease or for the third party to be in possession of the premises. On 15 June 2007, having previously written to the appellant to request payment of outstanding rent and outgoings, the respondents re-entered the premises, changed the locks, fixed a notice of re-entry and sold the plant and equipment at auction. At trial, no issue was raised that the date of re-entry was 14 days after 1 June 2007. The issue was first raised by a third notice of appeal. No evidence was led at trial to lay a foundation for suggesting that re-entry a day later would have had any impact or substantive effect.
Whether the Judge erred in his assessment of the amount owing as at 1 June 2007. Whether the Judge erred in finding that the respondents were entitled to re-enter the premises on 15 June 2007. Whether the appellant should be permitted to amend the grounds of appeal. Whether the Judge erred in finding that the payment by the appellant to the respondents in respect of the previous tenant’s debt was not in breach of the Retail and Commercial Leases Act 1995 (SA).
Held per Gray J (Kelly and Peek JJ agreeing) (refusing permission to amend the grounds of appeal and dismissing the appeal):
1.       The Judge’s findings on the amount owing by the appellant to the respondents were open on the evidence.
2.       On the proper construction of the contract, the Judge did not err in finding that the respondents were entitled to re-enter the premises 14 days after rent for June 2007 became due.
3.       The circumstances in which the proposed amendment to the grounds of appeal was raised are inimical to the due administration of justice and do not warrant a grant of permission.
4. The Judge’s findings with respect to the contractual position between the appellant and respondents and the former tenant of the respondents were open on the evidence. No cause of action under the Retail and Commercial Leases Act 1995 (SA) arose.
Retail and Commercial Leases Act 1995 (SA) s 13 and s 15, referred to.
Whisprun Pty Ltd v Dixon (2003) 77 ALJR 1598; Sazzi v Chang and Ors (No 3) [2014] SADC 48; Sazzi (SA) Pty Ltd v Chang and Ors [2013] SADC 178, considered.

SAZZI (SA) PTY LTD v CHANG & ORS
[2015] SASCFC 96
Full Court: Gray, Kelly and Peek JJ
GRAY J.

This is an appeal from orders made following a trial in the District Court.
The proceedings concerned a tenancy of premises in Gouger Street, Adelaide, used as a restaurant. The plaintiff and appellant was the tenant. The defendants and respondents were the landlords. On 15 June 2007, the landlords re-entered the premises asserting a right of re-entry under clause 38 of the lease. The landlords claimed that re-entry was lawful and that the lease was terminated. The tenant asserted that the landlords had no right to re-enter and claimed that the unlawful conduct of the landlords deprived them of the restaurant business conducted at the premises. As a consequence, the tenant claimed by way of damages the value of the business.
Following re-entry, the landlords took possession of plant and equipment which they then sold at auction. The tenant asserted that this was unlawful. A further dispute related to what was said to be a premium payment prohibited by the provisions of the Retail and Commercial Leases Act 1995 (SA).
The Judge concluded that the re-entry by the landlords was lawful and, as a consequence, dismissed the claim for damages for the value of the business. The Judge dismissed the claim that there had been a premium payment. The Judge found that the seizure of the plant and equipment was unlawful and that the tenant was entitled to an award of damages equivalent to the value of the goods.[1]
[1] Sazzi (SA) Pty Ltd v Chang and Ors [2013] SADC 178.
Background
On 14 September 2006, the parties executed an agreement to lease the premises. The agreement to lease was entered into in anticipation of the execution of a formal memorandum of lease.
The agreement to lease provided that the period of the lease would commence on 1 October 2006 and be for five years, with a right of renewal for a further five years. Rent was agreed in the amount of $46,168.00, payable monthly in advance by 12 equal calendar monthly payments. The tenant also agreed to pay outgoings.
The agreement to lease was subject to the following special condition:
Special Conditions: This Agreement to Lease is subject to the surrender of lease pertaining to the leased premises currently entered into between the landlord and Lai Chi Hung… and the lessee Lien Lang depositing a bank cheque of $21,232.75 being the payment of outstanding bills due to the landlord for the leased premises.
A memorandum of lease was entered into. The lease commenced on 1 October 2006 and was for a period of five years concluding on 30 September 2011. There was a right of renewal for a further period of five years. The tenant occupied the premises from 1 October 2006 and operated a restaurant at the premises. The tenant provided plant and equipment. Furniture was also supplied.
On 13 May 2007, the tenant ceased trading at the premises and opened another restaurant business, the Slippery Fish at Port Noarlunga. The tenant claimed to have entered into an agreement in writing for the sale of the business and some of the plant and equipment to a Mr Luc, for $100,000.00. It was intended that Mr Luc would take over the lease. The tenant left some items of plant and equipment at the premises. The tenant claimed that Mr Luc had full access to the premises from 13 May 2007. The landlords claimed that they did not authorise or permit Mr Luc to be in possession of the premises. The landlord would not agree to any assignment of the lease until all outstandings for rent and outgoings were paid. Advice to this effect was given to the tenant both orally and in writing.
On 15 June 2007, the landlords re-entered the premises, changed the locks and fixed a notice of re-entry. Following re-entry, the landlords seized the plant and equipment. The landlords arranged for the sale of the plant and equipment at auction.
Clause 2 of the memorandum of lease addressed the obligation to pay rent:
You must pay rent
2.1You must pay the rent in full (that is with no set off or reduction) in the way set out in Item 7
2.2You must pay it to us at our address as set out in Item 4 unless otherwise advised in writing
Clause 3 addressed charges:
You must pay charges
3.1You must pay any permit fees or other government fees relating to the property as set out in the disclosure statement
Also any telephone, gas and electricity charges relating to the property
Clause 4 addressed outgoings:
You must pay outgoings
4.1You must pay all rates and taxes relating to the property such as for example local government rates, water and sewer rates, and any excess water charges
4.2You must pay Emergency Services Levy relating to this property
4.3You must pay any land tax (on a single holding basis) relating to the property however you don’t have to pay land tax if this lease is a retail shop lease as defined in the Act
4.4You must pay the things mentioned in this Clause no matter who they are billed to.
Clause 6 prohibited the tenant from transferring the lease except with the prior written consent of the landlord:
6.6If you want our consent you must apply in writing to us. You must give us full details of your proposal and everybody involved. Also any further detail we ask for.
6.7If this lease is a retail shop lease, subject to the Act, we will not unreasonably refused that consent if you want to sign over all of your interest under this lease
6.8 In such a case we will only withhold our consent
If the tenant wishes to change the use of the premises
Or if the new tenant is unlikely to meet the financial obligations under their lease
Or if the new tenant’s retailing skills are inferior to yours
Or if you have not complied with the requirements of the Act for such an assignment
6.9If you want to sign over your interest under this lease you must request our consent in writing and you must have provided us with information we reasonably require about the financial standing and business experience of the person you intend to sign over your interest to. Also you must give the person to whom you want to sign over your interest a copy of any Disclosure Statement given to you in respect of the lease and updated details of any changes that have occurred since the Disclosure Statement was given to you.”
Clause 38, inter alia, addressed re-entry and relevantly provided:
38.1At any time after any event mentioned in this Clause happens, we can re-enter the property.
Or we can re-enter part of it whilst claiming it all.
[This means we can take back the property and exclude you from it]
This lease then ends
38.2 The events are:
If any rent is unpaid 14 days after it should have been paid (and after we have demanded it be paid)
Further clauses relevant to re-entry included the following:
Essential Terms
40.1You must comply with all of your obligations in this lease fully, correctly and on time without fail. Your strict compliance is essential.
Preservation of Rights
41.1If this lease ends, especially under clause 38 … that does not affect any right of either party
41.2Using a right (and especially the right of re-entry) given in this lease does not affect any other right
Refunding of Costs
43.1You must immediately refund to us any damages or penalties arising from your disobedience of this lease which we claim from you. You must immediately pay us any out of pocket expenses (including solicitors costs) to do with
Us getting or attempting to get anything you owe use
Us using or attempting to use any of our rights in this lease
Us enforcing, or attempting to enforce any obligation in this lease, or
Us curing or attempting to cure your disobedience of this lease
Abandoned Goods
58.1If this lease is a retail shop lease which ends and your goods are left on the property
After two days we may remove or destroy or dispose of the goods
If they are perishable foodstuffs or if their value is less than a fair estimate of their costs of removal, storage and sale
58.2If the goods are not perishable foodstuffs or valueless then we will store them in a safe place for at least 60 days
58.3Within 7 days of storing them we will give you notice to your forwarding address and if someone else to our knowledge has an interest in the goods, to that person and we will publish a notice in a newspaper circulating statewide, a notice in the form prescribed by the Retail and Commercial Leases Act 1995
58.4You or a person who is entitled to the goods may reclaim the goods by paying to us the reasonable costs of removal and storage and any outstanding rent or other charges
58.5If the goods are not claimed within 60 days we will, as soon as practicable after that time, sell those goods by public auction.
Almost immediately, difficulties arose with the payment of rent and outgoings. Cheques for November 2006 and January and March 2007 were dishonoured. In February 2007, an attempt was made by the landlords to distrain. However, as the Judge noted, documentary evidence suggested that the distraint did not proceed because there had been a settlement in respect of payment of outstanding monies.
The principal witness for the plaintiff was its director, Ms Lang. The Judge was unimpressed both with her credibility and reliability. On all disputed topics, Ms Lang’s evidence was rejected. Where Ms Lang’s evidence differed from that of the landlords’ agent, Mr Wong, the Judge rejected the evidence of Ms Lang. No challenge was made on the appeal to the Judge’s findings in this respect.
The evidence established that the plaintiff left the premises on 12 or 13 May 2007 and did not return until 18 June 2007. As earlier noted, the plaintiff left to open the Slippery Fish restaurant at Port Noarlunga. Ms Lang gave evidence that, from 12 May 2007, the responsibility for the premises belonged to Mr Luc. It was claimed that an agreement with Mr Luc was negotiated on Saturday 5 May 2007 at the office of Tennyson Turner. Ms Lang asserted that Mr Wong was present on 5 May 2007. Mr Wong denied attending. The Judge accepted Mr Wong’s evidence in this respect and rejected that of Ms Lang. No evidence was led from Mr Turner or Mr Luc in the trial.
Ms Lang informed Mr Wong that the plaintiff had some form of agreement with Mr Luc for the sale of the lease. In this respect, the Judge summarised Mr Wong’s evidence as follows:
Mr Wong also said that he informed Ms Lang that the strict policy of the JADS Group (and the landlords, its principal) was that all arrears of rent had to be finalised prior to the assignment of any lease arrangements. He said that after the meeting with Ms Lang, he received a letter from the plaintiff dated 3 May 2007. He says that he received the letter as a consequence of the conversation that he had with Ms Lang who had raised the question of the transfer sometime in that first week of May.
Mr Wong gave evidence that having received that letter and having had the conversation, he told Ms Lang of the plaintiff that he would speak to the landlord but he reiterated that all arrears had to be paid before the landlord would ever consider assignment of the lease. There was some prospect that the assignee, Mr Luc would enter into a new lease for the landlords. The landlord’s previous practice was to enter into new leases with tenants.
The Judge accepted this evidence.
The Re-entry
In respect to clause 38, the Judge concluded:
... In my opinion, objectively assessed, the clause means that the lease ends if rent remains unpaid 14 days after it should have been paid. There is no prescription in the lease as to how a demand may be made for the rent to be paid. In my view, any form of demand would be sufficient for the purposes of the clause and this includes an invoice to pay rent. The evidence of the parties disclosed that monthly invoices were rendered to the plaintiff by the landlords’ agent. In my opinion, if it be the case that a demand was necessary then the tax invoices delivered by the defendants’ agent satisfies that requirement. I am unable to accept the plaintiff’s contention on this question because it would not mean that a further 14 days would have to be given in respect of this demand, whether oral or in writing. That is not the meaning of the clause of the lease.
[Emphasis added]
The Judge then addressed the topic of precisely what rent was payable and the time at which it was payable:
... I am satisfied that as at 31 May 2007 an amount of $33,827.20 rent had been incurred. I am also satisfied that as at that date, 31 May 2007, the sum of $35,413.50 had been received by the landlord. The customer balance detail schedule reflects the fact that $7,500 (the cheque from Mr Luc endorsed to the defendants) was paid by the plaintiff to the defendants on 25 May 2007. However, shortly after that time, on 1 June 2007 a further amount of rent in the sum of $4,228.40 became due and payable. Allowing for the credit of $1,585.50, as at 1 June 2007, the plaintiff was indebted to the defendants in the sum of $2,642.90. Mr Ross-Smith submitted that the payment of outgoings was not an amount due under the terms of the lease because of alleged breaches of the requirements of the Retail and Commercial Leases Act. This amount does not include any liability claimed in respect of outgoings. Although I do not accept the plaintiff’s contentions in relation to outgoings, all that is necessary for me to decide in relation to this matter is whether or not rent was outstanding. It is also to be recalled that no application was taken under the LTA for relief against forfeiture in relation to non-payment of rent.
[Emphasis added]
The Judge concluded:
The plaintiff’s failure to pay rent became controversial because of the dishonour of a number of cheques given by the plaintiff to the defendants in payment of the rent. Mr Wong described the plaintiff as a very poor tenant particularly in relation to rental payments. This is borne out by the evidence, particularly as disclosed within the customer balance detail of the defendants. I am satisfied on the evidence that rent was in arrears as at 15 June 2007. I am also satisfied that the rent had been unpaid for a period of 14 days. I will leave to a consideration of the counterclaim, the question of the outgoings.
The Judge then addressed the question of the amount of rent outstanding and whether a demand had been made for payment within the meaning of clause 38:
It is then necessary to consider the parties’ contentions having regard to my finding that a rent amount was outstanding as at 15 June 2007. The defendants point to the letter from the defendants’ agent JADS Group Pty Ltd to the plaintiff dated 5 June 2007 in relation to the question of demand. In my opinion the demand is the invoice forwarded by the defendants to the plaintiff on a monthly basis. It follows that the contentions of the parties about questions of the effect of other correspondence is, to an extent, otiose. The contention of the plaintiff is that the letter is not a demand. In my opinion, the content of the letter of 5 June 2007 must be seen in the context of what was occurring between the parties. On 3 May 2007, the defendants’ agent had received a letter from the plaintiff indicating that the plaintiff wished to assign the lease held by it to Mr Luc. That letter was followed by a letter from the defendants’ agent to the plaintiff dated 7 May 2007. This letter identified that there were outstanding accounts in respect of the plaintiff’s rent. Item numbered 1 of the letter discloses that as at 7 May 2007 rent and outgoings of $8,047.65 were due and owing. That is, rent to the equivalent of almost two months of rent was unpaid. The letter reminds the plaintiff that subject to the plaintiff paying the outstanding amounts owed by it to the defendants, the defendants would not have any objection to the assignment of the lease. The letter also demands the payment of the costs in relation to the distraint of February 2007. Again, there is no evidence of any correspondence from the plaintiff challenging any aspect of the letter of 7 May 2007 and including the amount demanded for the costs of the distraint.
[Emphasis added.]

In my view, it was open to the trial Judge to conclude that, as at 31 May 2007, leaving aside the questions of outgoings, when all payments of rent were brought to account, the tenant had a credit of $1,585.50. On 1 June 2007, the rent for June 2007 of $4,228.40 became due. An invoice was raised on 1 June in respect of this amount. It was open to the Judge to find on the evidence that:
On that day [the 1^st day of the month] an invoice for payment of rent and any outgoings was delivered by the defendants’ agent to the plaintiff.
This finding accorded with the evidence of Mr Wong. As a consequence, putting aside the question of outgoings, rent in the amount of $2,642.90 was outstanding, being the rent due for June 2007 – $4,228.40, less the credit earlier referred to.
On 5 June 2007, the landlords’ agent wrote to the plaintiff referring to earlier correspondence of 3 May 2007 confirming that the tenant remained liable to pay outstanding outgoings and rent until the assignment of the lease was completed. Particular reference was made to the rent due for the month of June 2007. The Judge made the following observation in respect of this letter:
The ordinary objective reader looking at the correspondence would ascertain that the landlord through its agent is informing the plaintiff that the rent is outstanding ...
In my view, this conclusion of the Judge was correct.
On 15 June 2007, the landlords re-entered the premises. The landlords had a right of re-entry under clause 38 of the lease “at any time after an event mentioned in this clause happens”. The exercise of this right terminated the lease. The relevant sub clause provided:
If any rent is unpaid for 14 days after it should have been paid (and after we have demanded it be paid)
The Judge held that clause 38 did not require that re-entry occur 14 days after the making of the demand. As earlier noted, the Judge also held that:
There is no prescription in the lease as to how a demand may be made for the rent to be paid. In my view, any form of demand would be sufficient for the purposes of the clause and this includes an invoice to pay rent.
The Judge concluded that the provision of the invoice for June 2007 constituted a sufficient demand. The Judge considered, in the alternative, that the letter dated 5 June 2007 constituted a demand for payment.
I do not consider that any error has been shown in these conclusions. It follows that the landlords were entitled to re-enter 14 days after the June 2007 rent became due, namely, 14 days after 1 June 2007.
A New Issue on Appeal
At trial, no issue was raised that the date of re-entry of 15 June 2007 was 14 days after 1 June 2007. However, by a third amended notice of appeal, the plaintiff sought to contend that 14 days after 1 June 2007 had not elapsed before the re-entry. It was alleged that only 13 days had elapsed. It was said that 14 clear days after 1 June 2007 would have allowed a re-entry no earlier than 16 June 2007.
The proceedings have had a protracted history. The relevant events occurred in 2007. Proceedings commenced on 29 August 2007. The plaintiff’s fifth statement of claim, on which it proceeded to trial, was not filed until 14 May 2012, almost five years later. A trial date set for May 2012 was vacated as a consequence.
The trial finally commenced on 5 September 2013 and the evidence and submissions concluded on 11 September 2013. Judgment was delivered on 20 December 2013 and, following further submissions, judgment on costs was delivered on 21 March 2014.[2] The orders of the Court were not drawn up and sealed until 6 June 2014.
[2] Sazzi v Chang and Ors (No 3) [2014] SADC 48.
The notice of appeal was lodged in this Court on 10 January 2014. A second notice of appeal was filed on 29 May 2014. On 27 June 2014, the time for setting down the appeal was ordered to commence as from 21 March 2014. On 26 August 2014, the appeal had still not been set down and the time for the setting down of the appeal was extended to 31 October 2014. On 27 October 2014, the time for setting down the appeal was further extended to 30 November 2014. The appeal was finally set down on 27 November 2014. The appeal came on for hearing on 4 February 2015. However, it transpired that the appeal books were incomplete – critical documents were missing. As a result, the hearing of the appeal was stood over. Shortly prior to the February 2015 hearing, the plaintiff produced a third notice of appeal seeking to add a ground that the rental was not unpaid for 14 days at the time the landlords re-entered.
On the relisting of the hearing of the appeal before this Court, on 8 May 2015, the plaintiff made application to amend its appeal grounds to include this new ground. No affidavit was filed in support of the application. No material was advanced to indicate why the interests of justice would be served by allowing this entirely new issue to be raised for the first time on the hearing of the appeal. No evidence was led on behalf of the plaintiff to lay a foundation for suggesting that re-entry a day later would have had any impact or substantive effect.
If the proposed amendment were to be allowed, an entirely new issue would be introduced into the proceeding. To my mind, difficult questions would arise. As a consequence, it may be that the plaintiff’s officer, Ms Lang, would be further cross-examined. The question of her suggested abandonment of the lease and its significance would need to be explored. Questions of causation would arise. Could it be said that the plaintiff suffered any damage, as noted above. As earlier noted, the plaintiff considered that it was under no further obligations pursuant to the lease, that Mr Luc was responsible to comply with the lease, and the plaintiff was free to conduct her new restaurant business, the Slippery Fish, at a distant location.
As earlier observed, the plaintiff left the premises on 12 or 13 May 2007 to commence a restaurant business elsewhere. Ms Lang, in evidence, asserted unequivocally that the obligations under the lease from that time were those of Mr Luc. Ms Lang had, however, been advised both in writing and orally that an assignment of the lease would not take place while any rent and outgoings were outstanding.
In these circumstances, a question arises as to the significance of re-entry taking place the day before the landlords were entitled to do so, namely whether the position of the plaintiff would have been any different had the landlords re-entered on 16 June 2007. It is clear that the tenant’s position would remain unchanged. It is apparent that Ms Lang was aware that re-entry had taken place when she attended at the premises on 18 June 2007. The tenant had treated its obligations under the lease as being at an end. There was no suggestion that the tenant wished to return to occupy the premises on 18 June 2007. The default in the payment of rent continued. There was, and has been, no attempt to remedy that default. As noted above, if the tenant is correct that re-entry was one day early, questions as to causation of loss arise. Issues may also arise as to whether an estoppel may arise. It is not possible for this Court to resolve these questions. There would need to be a remittal of the matter to the trial Judge for further hearing.
The High Court, addressed the approach to be taken by an appellate court when a point is raised on the first time on appeal. In Whisprun Pty Ltd v Dixon,[3] Gleeson CJ, McHugh and Gummow JJ addressed the question in the following terms:
[3] Whisprun Pty Ltd v Dixon (2003) 77 ALJR 1598, [49]-[53].
Moreover, Ms Dixon's written submissions tell strongly against the way that the Court of Appeal saw the case. Those submissions were filed on 2 May 2001, over four months before the appeal was heard in September 2001. They were signed by Mr Jackson and contained no inkling that the trial judge had erred in the manner that the Court of Appeal subsequently found. The thrust of those submissions was the same as those found in the Third Amended Notice of Appeal.
In our opinion, the case formulated by the Court of Appeal was never run at the trial. Several matters point to this being so:
• The statement by the trial judge as to the only issue in the case. The reasons of the trial judge are usually the best indication of what matters were in issue at the trial.
• The omission of the parties to call the medical witnesses.
• The failure of the Third Amended Notice of Appeal to suggest that the trial judge had not properly considered the case of chronic fatigue syndrome.
• The focus in the Third Amended Notice of Appeal, the written submissions and the argument in the Court of Appeal on the issue of persisting Q fever infection.
• The lack of any evidence - apart from the existence of the medical reports - to suggest that Ms Dixon's case at trial was as the Court of Appeal's reasons imply that it was.
Accordingly, this appeal must be allowed. It would be inimical to the due administration of justice if, on appeal, a party could raise a point that was not taken at the trial unless it could not possibly have been met by further evidence at the trial. Nothing is more likely to give rise to a sense of injustice in a litigant than to have a verdict taken away on a point that was not taken at the trial and could or might possibly have been met by rebutting evidence or cross-examination. Even when no question of further evidence is admissible, it may not be in the interests of justice to allow a new point to be raised on appeal, particularly if it will require a further trial of the action. Not only is the successful party put to expense that may not be recoverable on a party and party taxation but a new trial inevitably inflicts on the parties worry, inconvenience and an interference with their personal and business affairs.
As Water Board v Moustakas makes clear, a point may be a new point even though it is within the pleadings or particulars. The pleadings and particulars are frequently decisive in determining whether a party is seeking to raise a new point on appeal. But they are not conclusive. To determine whether a party is raising a new point on appeal, it is "necessary to look to the actual conduct of the proceedings". Thus in Water Board, the plaintiff's case at trial had been that his employer was negligent in failing to prevent traffic from crossing in to the lane in which he was working. On appeal, the Court of Appeal of New South Wales allowed the plaintiff to raise a case that the employer was negligent in failing to provide a barrier to prevent the plaintiff from straying into the adjoining lane. This Court held that, although this alternative case was within the particulars, it had not been the plaintiff's case at the trial and the Court of Appeal had erred in allowing it to be raised on appeal.
As in Water Board, the case for Ms Dixon as formulated in the Court of Appeal is not the case that she ran at the trial. Moreover, it is a virtual certainty that, if such a case had been run at the trial, Whisprun would have wished to cross-examine the doctors. Because that is so, the Court of Appeal erred in considering this alternative case. No miscarriage of justice occurred because the trial judge considered the case that Ms Dixon ran at the trial. It follows that the Court of Appeal should have dismissed the appeal by Ms Dixon.
[Footnotes omitted.]
I consider that the interests of justice do not allow this new issue to be raised for the first time on appeal. It would be necessary, if the appeal was successful on this point, to remit the proceeding to the trial Judge for the taking of such further evidence as either party may wish to lead and for the making of further submissions. The landlord, the successful party on the issue of re-entry, is likely to be put to expense that may not be recoverable on a party-party taxation. There are also the inevitable consequences to the parties of worry, inconvenience and an interference with their personal business affairs. I consider that, given the extensive and unconscionable delay in the matter reaching trial and having regard to extensive delay in the appeal being prosecuted, it was incumbent on the tenant to do more than simply assert that re-entry took place one day before the landlord was legally entitled to do so. The circumstances in which the issue has been raised are inimical to the due administration of justice. I would refuse permission to amend the grounds of appeal.
Payment of a Premium
Section 13 of the Retail and Commercial Leases Act provides:
Certain obligations to be void
(1)An obligation to make or reimburse capital expenditure may only be imposed by or under a retail shop lease or a collateral agreement in the following cases:
(a)     a lessee may be required to pay or reimburse the cost of making good damage to the premises arising when the lessee is in possession or entitled to possession of the premises; and
(b)     a lessee may be required to fit or refit the shop, or to provide fixtures, plant or equipment, if the disclosure statement discloses the obligation and contains sufficient details to enable the lessee to obtain an estimate of the likely cost of complying with the obligation; and
(c)     a lessee may be required to contribute to a sinking fund to cover major items of repair or maintenance if reasonable details of the lessee's obligation are disclosed in the disclosure statement.
An obligation that may be imposed under this subsection is called a permissible obligation.
(2)A provision of a retail shop lease or a collateral agreement under which a lessee is required or may be required to make or reimburse capital expenditure is void unless the obligation imposed by or under the provision is a permissible obligation.
(3)A provision of a retail shop lease or a collateral agreement under which the lessee is required to compensate the lessor for depreciation of the premises attributable to ordinary wear and tear is void; but this subsection is not intended to prevent such depreciation being taken into account in the calculation, or assessment, of base rent.
Section 15 provides:
Premium prohibited
(1)A lessor must not seek or accept the payment of a premium in connection with the granting of a retail shop lease and a provision of a retail shop lease is void to the extent that it requires the payment of a premium in connection with the granting of the lease.
(2)     If a lessor or a person acting on behalf of a lessor contravenes this section—
(a)     the person is guilty of an offence and liable to a penalty not exceeding $10 000; and
(b)     the lessee is entitled to recover from the lessor as a debt any payment made or the value of any benefit conferred by the lessee and accepted by or on behalf of the lessor in contravention of this section (whether or not the person is convicted of an offence under paragraph (a)).
(3)     This section does not prevent a lessor—
(a)     from receiving payment for a right or option to enter into a retail shop lease if, when a retail shop lease is entered into, the payment is refunded or applied towards rent payable under the lease; or
(b)     from receiving from the lessee payment under a contract with the lessee for carrying out work on the premises before the lessee goes into occupation; or
(c)     from requiring payment of preparatory costs as permitted by this Act; or
(d)     from receiving payment of rent in advance; or
(e)     from securing performance of the lessee's obligations under the lease by requiring a security bond or a guarantee from the lessee or another person (eg a guarantee by the directors of a lessee company guaranteeing performance of the company's obligations under the lease); or
(f)    from seeking and accepting payment for goodwill of a business that has been conducted by the lessor; or
(g)     from seeking and accepting payment for plant, equipment, fixtures or fittings that are sold by the lessor to the lessee in connection with the granting of the lease; or
(h)     from seeking and accepting payment for the grant of a franchise in connection with the granting of the lease; or
(i)    from seeking and accepting payment of an amount of a prescribed class.
The Judge referred to this issue in the following terms:
There was a late amendment to the pleadings by the insertion of paragraphs 18A-18G inclusive. This amendment caused the adjournment of the first trial in this action in 2012. The allegations, in summary are that there was an insistence by the defendants that the plaintiff pay the sum of $21,232.75 as a condition of entry into the agreement to lease executed between the plaintiff and the defendants. It was said to be ostensibly for monies allegedly owing by the former tenant, one Mr Hung. The plaintiff alleges that this amount was paid by it and this allegation was put in contention. In my opinion this issue is one of the essential matters for resolution in this action and requires very careful scrutiny.
The Judge noted the plaintiff’s contention in respect of this claim as follows:
The plaintiff’s seventh contention was that Mr Hung, the tenant prior to the plaintiff was not obliged to pay the grease arrestor and other charges and therefore nor was the plaintiff. That contention may be answered in short. The plaintiff entered into a fresh Memorandum of Lease with the defendants commencing 1 October 2006. There was no assignment of the lease for the purposes of s43 of the Retail and Commercial Leases Act. Secondly, the amount that was paid by Mr Hung in relation to the grease arrestor occurred within an arrangement between the defendants and Mr Hung because the only obligation that existed was that of Mr Hung to pay the grease arrestor and other charges of $21,242.75. There was no obligation upon the plaintiff to pay that amount. Merely because the plaintiff paid that amount from a credit belonging to Mr Hung is not a matter for enquiry or consideration by this Court.
The Judge addressed and resolved this issue as follows:
A premium must be money paid on a benefit given to the lessor in connection with the assignment of a lease. Parliament has intentionally used broad forms of expression within the definition in order to give the broadest possible scope of operation to these provisions in which the word “premium” is used. The purpose of the provision and definition is addressed to the making of a payment from the tenant in return for the landlord to do no more than grant a lease. Although perhaps self evident, if the payment received by the landlord is from the tenant’s funds and is to satisfy a contractual liability of a third party the payment will continue to constitute a premium because the lessee or potential lessee has paid over its funds in anticipation of no more than the granting of the lease on the assignment. This fits the description of what is understood as key money. Conversely, the provision does not purport, for example, to address itself to the circumstance where third parties directly or indirectly agree upon the novation of a contract or an agreement within their own contractual arrangements for valuable consideration. This is reflected in the wording of sub-s15(2). For the sake of discussion on the assumption that an arrangement such as a tripartite arrangement in a form of novation does not come within the exceptions in sub-s15(3) e.g. sub-s15(3)(b) then sub-s15(2) is engaged. This subsection provides an entitlement upon the lessee to recover any payment made by the lessee or any benefit conferred by the lessee and accepted by or on behalf of the lessor.
In this case, there is no benefit conferred by the lessee plaintiff upon the lessor defendants that may be recoverable by the lessee. This is because the money paid to the lessor was in fulfilment of a contractual obligation of the lessee Mr Hung to make payments to the lessor. There was in that sense no novation arrangement because Mr Hung made no arrangements with the lessors that his liability to the lessor should now become the obligation of the plaintiff. The proper contractual position is that this plaintiff has been actually or implicitly authorised by Mr Hung to deduct from an amount due and owing by the plaintiff to Mr Hung an amount sufficient to discharge the debt of Mr Hung to the lessors. That arrangement is not the payment of a premium because the plaintiff does not make the payment, only Mr Hung. If the payment had been made independent of Mr Hung and from the plaintiff’s own resources, then the position would be very different.
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[Counsel for the tenant] purported to read the relevant provisions too broadly in light of the factual circumstances surrounding the payment of the sum of $21,232.75. Once it is understood that the true position is that the payment was made by Mr Hung in fulfilment of his contractual obligations with the defendants the question of a premium does not arise. That may be easily tested in this way. It would be a very peculiar result that the lessors may be seen to have committed an offence for sub-s15(2)(a) but the plaintiff as lessee would have no entitlement to recover under sub-s15(2)(b) as a debt any payment made to the lessors (my emphasis). Sub-s15(2) is a penal provision and is to be read strictly. The only way that the plaintiff could purport to recover the funds would be as a trustee under a form of trust as declared by the Court. This is not the status in which the plaintiff sues in this case which is for the recovery of a debt. In my opinion no debt is owing to the plaintiff by the defendants because no premium was paid to them by the plaintiff.
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I have already expressed the view that, in my opinion, no detriment has been suffered by the payment by the plaintiff of the sum of $21,232.75 that was in fact paid to the defendants. The plaintiff gave evidence that that sum was paid to the JADS Group on behalf of Mr Hung.
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It follows that I am in a position to find, and I do find, that no detriment has been suffered by the plaintiff from the payment of the $21,232.75 paid to the defendants and consistent with settled principles no restitution on any claim will arise in favour of the plaintiff against the defendants.
If I am wrong in that view, and the plaintiff is correct in relation to the operation of s13 and s15 of the Retail and Commercial Leases Act 1995, the entity who was entitled to make a claim to recover from the defendants as lessors is Mr Hung. No entitlement rests in the plaintiff in that respect and no evidence was given of any assignment of the debt claimed between Mr Hung and the plaintiff (if such an assignment were possible).
In my view, even if the transaction between the defendants and Mr Hung breached s13 and s15, the result is the same. The only entity entitled to raise the restitutionary claim would be Mr Hung. He could do that directly with the defendants. He has not done so. He is not a party to these proceedings.

The Judge, having rejected Ms Lang’s testimony, was entitled to conclude that the payment of $21,232.75 did not constitute the payment of a premium or the reimbursement of a capital expenditure. The monies were an amount paid by Mr Hung. The amount was deducted from the sale price of the business, the subject of the agreement between Mr Hung and the plaintiff. The money was forwarded on behalf of Mr Hung to pay the debt that Mr Hung owed as an earlier tenant of the landlords. These findings of fact were open to the trial Judge. No basis has been established to suggest that the findings were unjustified or inappropriate. Further, no benefit was conferred by the plaintiff on the landlords. No cause of action under the Retail and Commercial Leases Act arose.
Conclusion
I would dismiss the appeal.
KELLY J: I would refuse permission to amend the grounds of appeal. I would dismiss the appeal. I agree with the reasons of Gray J.
PEEK J. I would refuse permission to amend the grounds of appeal. I would dismiss the appeal. I agree with the reasons of Gray J.