Skiwing Pty Limited v Trust Company of Australia (Trading as Stockland Property Management

Skiwing Pty Limited (Skiwing) and The Trust Company of Australia (trading as Stockland Property Management) (Stockland) were the parties involved in a dispute before the High Court of Australia. The core of the disagreement concerned the interpretation of a retail shop lease agreement and the calculation of rent payable under that agreement. Skiwing, as the tenant, challenged Stockland's method of calculating the "turnover rent" component of its lease obligations.

The High Court was required to determine whether Stockland's interpretation of the lease provisions relating to the calculation of turnover rent was correct. Specifically, the court had to consider whether certain amounts received by Skiwing, which Stockland sought to include in the turnover calculation, were properly characterised as "gross turnover" for the purposes of the lease. This involved a close examination of the contractual language used in the lease agreement.

The Court's reasoning focused on the plain meaning of the words used in the lease. It held that the lease defined "gross turnover" in a way that did not encompass the specific amounts in dispute. The judges applied principles of contractual interpretation, emphasising that the ordinary meaning of the words, in their context within the lease, should prevail. They found that Stockland's broader interpretation was not supported by the express terms of the agreement.

Ultimately, the High Court found in favour of Skiwing, holding that Stockland had incorrectly calculated the turnover rent. The appeal was allowed, and the orders of the lower courts were set aside.