Solomon v Singh (No 2)

[2005] NSWADT 295

Pending Appeal:

CITATION:	Solomon & Anor v Singh (No 2) [2005] NSWADT 295
DIVISION:	Retail Leases Division
PARTIES:	APPLICANT Isaac Solomon, Sara Cooper and Elizabeth Oxman RESPONDENT Dr Raghubir Singh
FILE NUMBER:	035094
HEARING DATES:	3/11/2005-4/11/2005, 8/11/2005
SUBMISSIONS CLOSED:	11/18/2005
DATE OF DECISION:	12/16/2005
BEFORE:	Molloy GB - Judicial Member
APPLICATION:	Claim for payment of money
MATTER FOR DECISION:	Principal matter
LEGISLATION CITED:	Administrative Decisions Tribunal Act 1997 Retail Leases Act 1994
CASES CITED:	British Westinghouse Electric and Manufacturing Co Ltd v. Underground Electric Railways Co of London Limited (1912) AC673 Singh v Solomon & Ors (RLD) [2005] NSWADTAP 27 Solomon & Ors v Singh & Anor [2004] NSWADT 264
REPRESENTATION:	APPLICANT S Bell, Counsel RESPONDENT M Watts, Counsel
ORDERS:	1. The parties are directed to bring forward Short Minutes of Order in conformity with the terms of this decision. Those Short Minutes should specify the items allowed by this Tribunal in favour of the Applicant, set off the amount paid by Dr Sood and the quantum that should have been set off by way of mitigation in accordance with these reasons; 2. Matter listed for one-half hour at 2-00pm on Monday 30 January 2006 with a view to making appropriate orders pursuant to the said Short Minutes and directions (if required) as a consequence of the leave granted in Order 3; 3. Leave granted to either party to list the proceedings before me should the party so listing wish to agitate an argument relating to the Applicant’s legal fees contrary to the Tribunal’s expression of opinion set out in these reasons. Absent application to re-list on this issue made to the Tribunal at 2-00pm on 30 Janaury, 2006 the decision of this Tribunal will be a Declaration that the Applicant may not make claim against the Respondent for legal fees incurred in connection with the breach or non compliance by the lessee in relation to legal costs incurred in connection with the application to the Tribunal absent an application and order made pursuant to Section 88 Administrative Decisions Tribunal Act but otherwise the Applicant be entitled to recover against the Respondent their legal costs pursuant to Clause 27.2 of the lease subject to proper quantification

Background:

1 The Applicants are owners of premises known as Shop T12 (“the premises”) at the Eagle Vale Market Place shopping centre. The Respondent, Dr Singh, is a former director of Maxicare Medical Clinics Pty Limited (“Maxicare”) and S S Medical Pty Limited (“S S Medical”) who were the joint lessees of the premises from 4 May 1988 up to 31 July 2002. Dr Singh was one of the guarantors for the obligations of Maxicare and S S Medical under the lease. The other guarantor was Dr Suman Sood who was released from her guarantee obligations pursuant to a Deed of Release made on or about 9 June 2004. The effect of that Deed of Release has been considered by this Tribunal and was dealt with at first instance by Judicial Member S Higgins ([2004] NSWADT 264) and by the Appeals Panel ([2005] NSWADTAP 27). In both decisions the Tribunal has determined that the release of Dr Sood did not operate to release Dr Singh, the Respondent to the Application now before me.

2 There is no need for me to refer to either of those decisions other than by background reference as above. I understand that the decision of the Appeals Panel is now on appeal itself to the Court of Appeal but it seems to me that whatever may be the decision of that Court it would not affect the issues now before me.

3 The original lease is dated 23 January 1996 and was between Woolworths Properties Pty Limited as lessor and Maxicare Family Clinics Pty Limited. It commenced 5 September 1995 and terminated 4 September 2000. The Respondent was one of the original guarantors. Woolworths sold the shopping centre known as “Eagle Vale Market Place”, Gould Road, Eagle Vale to the Applicants on 19 February 1996, the Applicants thereby becoming the lessor.

4 On or about 4 May 1998 the Applicants and Maxicare Family Clinics Pty Limited entered into a Deed of Consent to Assignment of Lease wherein and by which Maxicare Family Clinics Pty Limited transferred its interest as lessee of the premises to S S Medical and Maxicare Medical Clinics Pty Limited (“Maxicare Medical”). The Respondent continued as guarantor, the other original guarantors were released and Dr Sood became a co-guarantor with the Respondent. By Variation of Lease of the same date the term of the lease was increased to 10 years “so as to expire on 04/09/2005”. The Variation of Lease also provided that the rent payable under the lease “shall be increased on each and every anniversary of the extended term of this lease at the rate of six percent (6%) per annum”.

5 In general terms, S S Medical and Maxicare Medical fell on economic hard times and on 2 April 2002, by Orders of the Supreme Court of New South Wales, Mr Antony de Vires (“the Receiver and Manager”) was appointed Receiver and Manager of “Maxicare Family Clinic”. The precise relationship between S S Medical and Maxicare Medical on the one part and the business “Maxicare Family Clinic” is not clear and is probably not relevant. Whatever be the position the report of the Receiver and Manager 13 June 2002 indicates that the entity “Maxicare Family Clinic” was in fact a “partnership business”.

6 There is no need to go into the details of the partnership or why it was that the business fell upon hard times. Suffice it to say that there was a change in the health insurance regime which appears to have particularly negatively impacted upon those medical practices operating under the bulk billing system and, to quote the report of the Receiver and Manager 13 June 2002 (paragraph 1(b)) “the personal and professional relationship between the partners (Dr Singh and Dr Sood) complete broke down in or about May/June 1999 at which time Dr Singh took control of the running of the clinic at Eagle Vale until the appointment of the Receiver and Manager on 2 April 2002” and at some time or other the lessees fell into arrears under the terms of the lease.

7 Ultimately, on 2 April 2002, the lessees vacated the premises and the Applicants re-let the premises to D G S Tosson Pty Limited (“Tosson”) for a term of three years commencing 1 August 2002 and terminating 31 July 2005. This company was (and is) the service company for a medical practitioner.

Issues:

8 The Applicant claims damages for breach of the lease against the Respondent Dr Singh as guarantor as follows:

a) rental arrears: $14,758.00
b) loss of rent: $93,725.27
c) outgoings: $59,576.38
d) interest: $ 5,850.31
e) leasing commission: $ 6,600.00
f) legal fees to 31.10.2005: $74,351.00
$254,860.96
Less payment by co-guarantor
Dr Sood $ 13,550.00
Amount claimed: $241,310.96

9 The Respondent does not dispute the quantum of the rental arrears nor the outgoings. However, the Respondent disputes, not so much the quantum of the loss of rent but rather the fact that in his submission the Applicant has not mitigated that loss. Indeed, that was the primary issue the subject of evidence and cross-examination. The Respondent also challenges the leasing commission and the legal fees and initially disputed the amount said to have been paid by the co-guarantor Dr Sood – in this regard no submissions have been made on this issue and I regard the amount paid by Dr Sood as effectively not in dispute.

10 The most important matter the subject of the hearing was the issue of mitigation. A considerable amount of evidence was led on this issue and the two experts called by the parties were each subject to robust cross-examination. I therefore propose to deal with that issue first.

The Expert Evidence:

11 At the outset I observe that the parties, understandably, devoted a considerable amount of time, both at the hearing and in written submissions, criticising the expertise of the expert called by the other. Mr Kinley, called by the Applicant, is a director of Raine & Horne Commercial, the Property Manager for the Applicants. He stated that he had been the Property Manager for the Applicants from about July 1998 until the date of the hearing. He gave evidence, firstly relating to the background of the title of the premises, then gave evidence of what he did as the Property Manager in relation to the lessees and the Respondent and with respect to the (uncontested) default of the lessees, and then gave evidence relating to what he did in order to re-let the premises. In relation to his experience he stated that he had “extensive experience in assessing market rents of shops in retail shopping centres gained from 15 years of working in the area of commercial property”. He said he was “one of the leading commercial property managers of retail shopping centres in the Campbelltown and Eagle Vale area”. There is no need to go into all of his experience – suffice it to say that he is a licensed real estate agent, that he dealt firstly in retailing and moved into the commercial property industry in 1990 when he “was first employed as a shopping centre manager”. He continued to be engaged in “managing commercial shopping centres” and up until 1998 his “duties included locating new tenants for the various shops within the Eagle Vale Market Place Shopping Centre, assessing the rental of shops for inclusion into the lease documentation or for offers to potential tenants. (He) also provided market rental reviews for leases and generally negotiating the lease with tenants.” In 1998 he formed “a specialist shopping centre management and leasing company”. This company has the exclusive management of five neighbourhood shopping centres and (he) was directly involved in the management of these shopping centres.” In 2003 that company “merged with Raine & Horne Commercial” and he continued to manage shopping centres including the Eagle Vale market place. He does not hold a valuation qualification as such but holds a “Advanced Certificate in Real Estate, Property Stock and Business Agents Licence, Shopping Centre Management No. 1 and 2”. He is not a registered valuer.

12 Mr Gunning, who gave evidence on behalf of the Respondent, is a Certified Practicing Valuer, a Fellow of the Australian Property Institute, a previous Chairman of the Commercial Chapter of the Real Estate Institute of NSW and is currently Vice Chairman of that Chapter and has “over 30 years of experience in all facets of real estate agency, valuation, consultancy and property development”. He is the principal of Gunning Commercial. Again, there is no need for me to refer to the rest of his Curriculum Vitae or his experience.

13 To some degree both experts had “defects” in their respective expertise. Mr Kinley was not a Certified Practicing Valuer (for example) and Mr Gunning was not a person who had experience in this particular area of the outer Sydney metropolitan area. In neither case (however) in my opinion is either expert to be regarded as a non-expert in the particular field about which they gave evidence before me. Mr Kinley is certainly a person of considerable experience in real estate shopping centre leasing and management. Mr Gunning has all necessary experience and qualifications which would entitle him to express the opinions that he has expressed. The fact that someone does not have any particular experience in a particular area does not of itself disentitle that person from expressing an expert opinion nor does it result in a devaluing of that opinion. As long as the witness has the relevant experience and/or qualifications and has a grasp of the principles (and it was not suggesting that either witness did not have a grasp of the principles) then in my view their expert evidence is admissible and should be given appropriate weight. If this were not the case then it would be difficult, if not impossible, to obtain valuations of remote places. It is a combination of experience, qualifications and a grasp of the principles which in my view establishes a person as an expert.

14 By way of final observation on this issue the fact that Mr Kinley was also intimately involved in dealing with the Respondent and intimately involved in the re-leasing of the premises to Tosson does not (in my view) disentitle him to express an expert view neither does it devalue his expert opinion.

15 Finally, I should make this observation: both experts gave evidence fearlessly and I am not prepared to make any adverse findings or observations about either of them in relation to the quality of their evidence, their expertise or the opinions that they have expressed. It is the job of this Tribunal to weigh up the conflicting expert evidence having regard to the facts as found and all the circumstances as put before the Tribunal by the parties.

Expert Evidence Generally:

16 There is one point that I think is worth making with regard to the use of experts: a person who is put forward as an expert is nothing more than a witness for a particular party. There is currently a debate about the qualifications and use of experts, the debate even suggesting that the Court should use its own appointed expert (how it does that and holds the scales of justice in an unbiased fashion has not been explained) and there are even suggestions of professional penalties against experts.

17 This debate arises out of the failure of Courts to understand what is their role. Their role is not to deliver “justice” in its simplistic form. The role of a Court is simply to determine the dispute between parties on the evidence adduced by the parties. Nothing could be more simple. It is the parties who elect the witnesses and it is the parties who elect what material to put before the Court by way of evidence. A party may elect not to call a particular witness or not to put particular documentary evidence before the Court. That should not be a ground of adverse comment by the Court (subject to the rule in Jones v. Dunkell) but rather the Court should, subject to the usual evidentiary rules, admit the evidence adduced, and then be able to sift through that evidence and draw appropriate conclusions.

18 A Court is not bound by the evidence of a particular witness, be he/she expert or otherwise. It is the job of the Court to analyse the evidence, accept all or part or none of the evidence of a particular witness (expert or otherwise) and then bring down a Judgment on the evidence adduced by the parties and accepted by the Court.

19 To try to perfect the essentially philosophical concept of “justice” in every case where the parties, for whatever reason, may have elected to adduce evidence in a particular form or not adduce particular evidence is a task for which the Court is singularly ill-equipped. Courts, and Tribunals, should simply “get on with the job” and determine the issues on the material put forward by the parties and accepted by the Court.

Mitigation:

20 The factual steps taken by the Applicant to re-let the premises are not in dispute and can be summarised in this fashion: on the date of appointment of the Receiver and Manager he spoke to Mr Kinley and requested “a one month rent free period to allow the administrator to continue running the (medical) practice and sell (it) as a going concern”. There was apparently a subsequent meeting between Mr Kinley and the Receiver and Manager on or about 9 April 2002 and this arrangement was (effectively) confirmed.

21 On 13 April 2002 the Receiver and Manager placed an advertisement in the Sydney Morning Herald seeking “expressions of interest by close of business 22 April 2002” for the purchase of a “Medical Practice – currently operating fully equipped five room General Practice facility including x-ray room and procedure room – patient files available”. There was (curiously) no reference to the geographical location of this practice and Mr Kinley did not see that advertisement until “a week or so” after it was published. Advertisements were also placed “in the local medical journal in the Fairfield area”.

22 As I understand the evidence although the lessee and the Respondent had abandoned the premises as at 2 April 2002 and ceased to pay rent, a medical practice continued to operate from the premises staffed by Doctors Sood, Ghobrial and Chandri.

23 In his report 13 June 2002 the Receiver and Manager stated that “upon appointment I took control of the business and its assets with the intention of continuing to trade in order to avoid any disruption of medical services in the area and to realise the business as a going concern. My intention was to minimize both partners’ liability (ie the liability of the Respondent and Dr Sood) especially in relation to the unmet lease liability”. He observed that upon his appointment “the practice had insufficient cashflow to continue trading and both partners (the Respondent and Dr Sood) were requested to contribute funds”. In his view he “did not consider the practice had goodwill as a result of the history of the partnership disputes and the present issues concerning bulkbilling and medical insurance”. He stated that he had “engaged valuation consultants to value the business on an “existing use basis” and “auction basis” in an effort to have an indication of the worth of the assets of the Practice in negotiations with respective purchasers. The practice assets are valued as follows:

Market Value for Existing Use $63,650.00

Auction Value $28,463.00

24 In addition to the above observations it appeared that on the date of his appointment the Respondent provided the Receiver and Manager “with documentation from the NSW Medical Board advising that he (the Respondent) could no longer practice at the Medical Practice unless he was supervised by another practitioner on the premises who is aware of Dr Singh’s employment related conditions. None of the practitioners were willing or able to take on the responsibility”. This, “in effect meant that the practice immediately lost its only fulltime medical practitioner and that prima facie had little working capital to sustain itself … as a result of Dr Singh’s inability to practice he was not available to assist with the running of the practice or provide any funds by way of working capital. This severely constrained cash flow for the practice. Dr Singh also could not be contacted from about mid-April 2002 despite my staff leaving numerous messages on his message bank. An attempt to contact him through his solicitor also proved unsuccessful. This made it difficult to consult both parties (Dr Singh and Dr Sood) regarding the running of the practice generally”.

25 The Receiver and Manager also stated that “(t)throughout this period negotiations were commenced with several potential purchasers that have failed to result in any written offers to date. However negotiations are current between a medical practitioner in the area and the landlord with respect to settling the lease of the premises. It has been difficult trying to effectuate a sale of the Practice. The demise of the biggest of the Medical Indemnity Insurer in recent weeks may have also had an adverse effect in relation to the interest to purchase the medical practice”. In addition there were “discussions with (Mr Kinley) in the event that current negotiations break down with respect to an exit strategy and whether or not the landlord will consent to an on-site auction of plant and equipment if this course of action is seen to be appropriate”.

26 As I understand it there were approximately 17 doctors who expressed some interest in purchasing the “Maxicare Family Clinic”. Only one of those doctors ultimately “came to the party”, Dr Tosson, in the circumstances to which I make reference later.

27 Mr Kinley granted to the Receiver and Manager a rent free period of one month (presumably from 2 April 2002).

28 The evidence suggests (as I have observed above) that the practice did in fact continue after 2 April 2002 and ceased trading on or about 15 June 2002. This aspect was covered in the report of the Receiver and Manager 29 January 2003 on page 3 when he made this observation:

“As a result of the protracted negotiations with prospective purchasers and the availability of doctors to service patients at the practice together with the sporadic trading times and the uncertainty surrounding the existence of the business, patient visits starting falling. Further, due to the nature of a bulk-billing medical practice, when patient numbers declined it became difficult to continue trading on a cashflow positive basis. Accordingly I ceased trading on or about 15 June 2002. It was costing the practice more money to continue trading than to cease trading with wage costs being the major expense of the business”.

29 It is plain to me that, whatever may have been the problems between the Respondent and Dr Sood and whatever may have been the change in the medical economics scene, the plain fact is that the income from the medical practice was not sufficient to meet its outgoings and, in particular, could barely meet (if at all) the rent. There was some evidence that might have encouraged me to conclude that the rent was in any event too high, that the Respondent had complained to Mr Kinley about it and that various doctors who may have been interested in taking over the medical practice were not enamoured with the rent payable under the lease. Mr Kinley was cross-examined quite vigorously about a file note that is dated “20/8” and which appears at page 193 of his first affidavit. Mr Kinley’s evidence was that the note was made on 20 August 2001 – it relates to enquiries that he made of at least one medical practitioner – but it seems to me that even if that date is wrong as to the year then the note demonstrates that at least one other interested medical practitioner thought the rent was too expensive. This conclusion is derived from the last line of that note which states “26/8 – rent too expensive”. Quite frankly, I do not think anything hangs upon it simply because it is plain to me that the medical practice of the Respondent and Dr Sood could not support the rent for the premises and it is also plain, indeed starkly plain, that the rent for these premises was too high for a medical practice. Indeed, ultimately Tosson signed a separate lease in separate terms for a period of three years commencing 1 August 2002 with a five year option for renewal at a rental for the first year of $48,000.00, for the second year at $61,500.00 and for the third year $78,000.00 (all exclusive of GST); this to be compared to the commencement rent for the original lease commencing 5 September 1995 between Woolworths Properties Pty Limited and Maxicare in $55,500.00 per annum and the rent in the Variation of Lease dated 4 May 1998 between the Applicants and S S Medical and Maxicare Medical which extended the five year term of the lease to 10 years and increased the rent “on each and every anniversary of the extended term of this lease at the rate of six per cent (6%) per annum.” I had not personally worked out the mathematics but the evidence of Mr Kinley was to the effect that Dr Tosson’s offer was 57% of the then existing rental (in June 2002).

30 Mr Kinley’s evidence was that he attempted to re-let the premises by putting up a sign in the mall portion of the shopping centre. But his view was quite clear and that is that although there was a wide range of permissible uses for the premises those uses were not considered “based upon my experience and market comparables”. He formed the opinion that the best use of the premises was as a medical practice. For that reason it seems that he effectively relied upon the Receiver and Manger to market the medical practice as a going concern. The premises were set up, by way of fixtures and fittings, as a medical practice and his view was that a medical practice/centre should operate from this shop. He accepted that he (or the Receiver) had only one offer and one offer only and that if that offer (from Tosson) fell away then he would need to consider alternative uses. But he only ever pursued one use and never put his mind to any other possible use.

31 He conceded that on the sign put up in the mall area there was no reference to this particular premises, there was no “To Let” or similar sign in the window of the particular premises and that the sign put in the mall area could not be seen from the premises and any sign put in the window of the premises could not be seen from the mall area. There was provision in the lease for a “To Let” sign or similar being placed in the window of the premises but Mr Kinley said that was a common clause and “very rarely relied upon”.

32 He also stated that if the premises had been cleaned out of fittings and fixtures they would be difficult to market for general retail purposes. But the plain fact is, and I shall refer to this again shortly, the Applicant never tested the market. It is plain, and the evidence is clear on this aspect, that the Applicant proceeded on the basis that the medical centre/practice was the best use of the premises. Mr Kinley’s evidence to that effect was repeated on numerous occasions. Having adopted this view he did not consider contacting other leasing agents (he said this was “not usually productive” and that local agents would not have had had the ability to prepare a leasing package for this “unique” shopping centre and premises). He believed Tosson’s offer was “fair and reasonable”, that his job was to find a business that could support itself, that there was a need in the community for a medical practice at this location and that, bearing all matters in consideration, he believed he had discharged his obligation in that he had found the best use of the premises being a medical practice. Consequently, he concurred on behalf of the Applicant with the view of the Receiver and Manager when on 2 July 2002 Mr Kinley wrote to the Respondent stating that the centre manager had “been working with the administrator to assist the administrator sell the practice as a going concern (and to) see prospective practitioners and other potential lessees … (and he advised) that the (Applicant) has agreed to a terms with a new lessee (Tosson) who is to take up occupancy from 1 July 2002” (it turned out to be 1 August 2002) …. and he wrote “to confirm your continuing obligation under the guarantee and we place you on notice that the claim for loss of rent, costs, associated with procurement of a replacement tenant and legal costs which are incurred as a result of the determination”. Ultimately, Mr Kinley made a demand upon the Respondent as guarantor under cover of his letter 17 September 2002 which he reviewed the history of the matter, confirmed that the premises had been relet to Tosson, set out the rental increments and claimed leasing commission and administration costs, legal fees and “nett deficit of rent” to the end of the lease.

The Shopping Centre:

33 Eagle Vale Marketplace is, on the evidence, a “neighbourhood shopping centre” as distinct from “a community shopping centre”, the latter being larger than a neighbourhood centre and generally consisting of one supermarket, one discount department store and 35 or more retail shops. A “neighbourhood shopping centre” is one which consists of one supermarket and approximately 10-20 retail shops. Eagle Vale consists of approximately 18 leased areas. The primary lead tenant is a Woolworths supermarket to which is attached its liquor store. The shopping centre effectively faces north towards Eagle Vale Drive with a large parking area in the front to which access is obtained from both Eagle Vale Drive and Gould Road (the latter on the north-east). Opposite the main carparking area is the entrance to the shopping centre arcade. Situate to the north-west of the shopping centre and north-west of the entrance of the shopping centre arcade is a McDonalds outlet.

34 As one enters the arcade from the main carpark one passes by and number of shops. On the right, walking to the south towards Woolworths, one passes a TAB (Shop T09), a dentist (Shop T08), a hairdresser (Shop T07), a newsagency (Shop T06), Chinese takeaway (Shop T05), a fish and chip shop (Shop T04), a delicatessen (Shop T03) and a butchery (Shop T02). By this point one is in the courtyard just in front of the Woolworths supermarket.

35 Again, and entering the arcade from the main carpark, as one walks down the arcade on the left one passes a discount store (Shop T11), a chemist (Shop T14), a jewellery shop (Shop T16), a bakery (Shop T17) and tobacconist (Shop T18). Again, by this stage one is in the courtyard in front of Woolworths. In the middle of the courtyard is a kiosk which sells donuts.

36 Now, and going back to the entrance to the arcade, if one walked in a north-westerly direction towards McDonalds one would pass a Video Ezy outlet (Shop T10), which shop is not connected to the arcade but is part of the shopping centre.

37 Where is Shop T12, the premises the subject of these proceedings? If one walks from the entrance to the shopping arcade in an easterly direction one needs to travel around the corner to the right in a southerly direction and there one finds the premises, which are situate opposite a small carpark and which premises are not connected to the arcade walkway leading from the main carpark past the other shops to the Woolworths supermarket.

38 There were all sorts of arguments put up at the hearing about the location of the premises. It is plain to me that the premises are not in the main thoroughfare, not near the main entrance, are in a low foot traffic area and not connected to the arcade leading from the main carpark through to Woolworths neither is it situate on the more popular side being that side towards the Video Ezy outlet and McDonalds. Indeed, one could not imagine a worse location in a shopping centre for a shop with a business designed to attract passing custom. Clearly its location does not. Clearly, passing custom is those members of the public that would frequent the lead or popular tenancies like Video Ezy (next to McDonalds as well) Woolworths and popular type retail outlets selling food, newspapers, discounting, hairdressing, pharmacy and a TAB.

39 I have been to some trouble to identify the location of the premises. Great play was made by both parties over its location and an analysis of it in this Judgment and my conclusions thereon are not unwarranted.

Respondent’s Evidence on Mitigation:

40 Mr Gunning gave detailed evidence on this aspect. There is no need to review all of his evidence. He was vigorously criticised for using a draft report of a Mr Sanidas, a fellow director of his. Mr Gunning said that he had not adopted the draft report of Mr Sanidas but rather that he disagreed with the approach of Mr Sanidas to market rent and marketing. He conceded that Mr Sanidas thought the gross rental for the premises was about $68,000.00 but he, Mr Gunning, thought Mr Sanidas had discounted the rent and had adopted the wrong approach. He prepared his own report in so far as he adopted those portions of the Sanidas draft with which he agreed but changed those portions with which he did not agree, that he formed his own opinion and had inspected the premises and the shopping centre twice.

41 There is no doubt that Mr Sanidas is a registered valuer and it is plain from the “conflict” between Mr Sanidas and Mr Gunning that there are quite valid areas with which reputable valuers can validly disagree. Indeed, one can take independently judicial notice of this.

42 Mr Gunning was highly critical of the marketing efforts of the Applicant. In Mr Gunning’s view “a properly coordinated and appropriately timed marketing of the premises … in a professional manner (and) in conformity with the usual business practices adopted by shopping centre owners when seeking to lease premises … would have lead the (Applicants) obtaining a higher rent per square metre than that obtained under the lease to Tosson”. In his view the Applicants (and by inference Mr Kinley) should have:

“i. erected appropriate signage in front of the shop displaying the message “Shop To Let”;

ii. Conducted leaflet drops to adjoining and surrounding areas with a view to attracting expressions of interest for the leasing of the Premises;

iii. Engaged commercial leasing agents and local real estate agents to secure a new tenant on a commission only basis;

iv. Widely advertised the Premises in the local newspaper(s) and the Sydney Morning Herald until a tenant was secured on terms not materially different from the terminated lease;

v. Listing the premises on well known industry Internet sites …;

vi. Advertised the premises in specialist magazines and journals, eg medical and dentistry journals;

vii. Advised tenant representation group acting on behalf of major retail, food and service groups alike (franchise and non-franchise) ie Pizza Hut, Taco Belle, particularly given the existence of McDonald’s within the immediate vicinity”.

43 It is his opinion that by adopting those “usual practices for leasing”, “an annual rental range per square metre of between $550.00 and $650.00 per square metre (gross) was achievable for the Premises as at July/August 2002. In (his) opinion a rental of $600.00 per square metre (gross) for the Premises was achievable in July/August 2002”.

44 In support of that opinion he refers in detail to “the current and rental history of the” shopping centre. That history makes it plain (and he accepts) that the rent per square metre he believed was achievable differed greatly from the rent payable under the lease to Tosson. He says that in his opinion “the difference is due largely, if not wholly, due to the fact that the usual steps taken by shopping centre owners to lease up premises were not taken in the present case”. In his view “the steps taken by Mr Kinley were insufficient and led to a rent being obtained which was below the achievable market rent at the time” principally because (in his view) there “were no print media or other forms of advertising undertaken” and Mr Kinley’s view “that the highest achievable rental would be obtained by re-leasing the premises as a medical centre”. In Mr Gunning’s opinion ‘there was no demonstrable reason or evidence which warranted, then or now, such a view”. He says that the premises “would have been attractive to a wide range of potential users, including but not limited to use as an electronic/ computer store, dry cleaners, beauty/day spa or hobbies home craft”. He disagreed entirely with Mr Kinley’s view that the “specialised fit out and extensive patient file made it difficult to market the premises as suitable for general retail or as a general commercial office”. He points out that the “fit out for the shop could have been easily recovered and the costs charged to the outgoing tenant” and he states that “the existence of patient files would not restrict various ways in which the Premises might be marketed for lease. The shopping owners or its agent sought to meet a preconceived agenda in re-instating the current use, ie maintain tenancy synergies between current pharmacy and dentist tenants currently in the centre”. As a result, in his opinion, “the steps taken (or lack of them) inevitably led the premises (being) leased at a significant undervalue”.

45 There is no need for me to review at this point the rental evidence pertaining to other shops in the shopping centre. I accept the view expressed by Mr Gunning to the effect that shopping centre managers like to keep a rental balance in a shopping centre. This generally has a flow-on effect to all shops within the centre and clearly shopping centre lessees talk amongst each other and a shopping centre manager would generally (one would think) like to ensure (as best possible) that the shopping centre operates in a reasonably happy milieu.

Opinion of the Tribunal:

46 The lease makes quite specific provision (Clause 20.3(b)) that the Applicant as Landlord “must take reasonable steps to mitigate its loss”. There is also an obligation at law to mitigate. The onus of proving failure to mitigate rests on the party asserting same. In this case the onus of proof is on the Respondent.

47 Nextly, it is important to make this observation: the evidence demonstrates that the lessee abandoned the premises and failed to pay rent on and after 2 April 2002. In my opinion that amounts to a repudiation by the lessee of the lease. Repudiation of a contract involves an intention to renounce the contract and absolute refusal to perform it. In these circumstances the other party can elect to accept it, treat the agreement as terminated and claim damages for repudiation for loss of the benefit of the agreement, or alternatively, the other party need not accept the repudiation but simply seek to enforce the contract by specific performance or by claiming rent or damages for breach of the terms of the agreement. As I understand the law falling behind in rent is not of itself repudiation but the abandonment of the premises and the failure to pay rent, coupled with the appointment of a Receiver and Manager, seems to me inevitably to point to a repudiation by the lessee.

48 As I further understand the law a party accepting repudiation and treating the agreement as terminated has a duty to take all reasonable steps to mitigate the loss consequent on the breach and cannot recover that part of the damage which is due to its failure to mitigate the loss – see British Westinghouse Electric and Manufacturing Co Ltd v. Underground Electric Railways Co of London Limited (1912) AC673 at 689. And in Kercher & Noone “Remedies” (1983) at 117, the author stated: “Whether a (Plaintiff) has failed to mitigate its damages the question of reasonableness”. It is clear that attempts by the Applicant to mitigate must be reasonable. And the answer to the question of whether the Applicant took such reasonable steps is really the main issue in this case.

49 I accept that Mr Kinley had a genuine view as to what he thought was the best use of the premises. There was no evidence as to what the Applicant thought, or any of them – none of them gave evidence. There was no evidence of what instructions they gave to Mr Kinley. There was no evidence of any professional advice that they may have received. The evidence does not disclose any advice given by Mr Kinley to the Applicant. But whatever be the position the Applicant clearly relied upon Mr Kinley as the shopping centre manager and Mr Kinley himself brought to the task his expertise and opinions relating to the re-letting of the premises consistent with the duties of the Applicant to mitigate their losses.

50 The question is: did the Applicant discharge their duty to mitigate, a duty imposed upon them by law and by the lease contract? In my view the answer must be a resounding “No”.

51 It cannot be said that a person who has a duty to mitigate discharges that duty by not testing the market. The duty is not discharged by simply going along with the Receiver and Manager (in this case) and attempting to craft a commercial deal consistent with the desire of the Receiver and Manager to sell the medical practice. There was no duty to discharge between Mr Kinley and the Applicant (on the one hand) and the Receiver and Manager on the other hand. The duty that Mr Kinley had was to the Applicant and the duty that Mr Kinley and the Applicant had was to the Respondent. That is not to say that there was not a duty to the lessee (as distinct from the Receiver and Manager) but in reality (as distinct from law) the real duty was to the guarantor (the Respondent) because the lessee was insolvent. I do not think that the duty was thereby raised but rather reinforced by the fact that a guarantor is exactly that, a guarantor, and personally liable such that the duty of the Applicant and Mr Kinley should have been sharpened by that fact.

52 However, the duty is the same: the duty to mitigate - the duty to take reasonable steps to mitigate. Not to test the market in my view is not taking a reasonable step. I agree generally (but not necessarily completely because there is no need to analyse each suggestion (although I think that step (iv) puts the bar too high)) with the views of Mr Gunning (set out above) as to the various steps that he set out that “a properly coordinated and appropriately timed marketing of the premises … conducted in a professional manner (and) in conformity with the usual business practices adopted by shopping centre owners …”. I agree with the Written Submissions on behalf of the Respondent to the effect that “for approximately four months from 2 April 2002 the Applicant took no steps that were directed at offering the premises for lease to all potential tenants”. In fact Mr Kinley took very few steps to re-lease the premises but seemed (on the evidence) to rely upon the Receiver and Manager. Having formed the view that “the best use” for the premises was to lease it to another medical centre operator he seemed to defer to the Receiver and Manager, never went “outside the sale process conducted by” the Receiver and Manager even though he accepted that the premises “could be used for many uses other than a medical centre” and acknowledged that without having attempted approaches to other potential users he had no relevant benchmark upon which he could have relied to form such an opinion.

53 The matter can be tested in this fashion: the history (outlined above) demonstrates that the original lease commenced 5 September 1995. On or about 4 May 1998 Maxicare Family Clinics Pty Limited transferred its interest as lessee to S S Medical and Maxicare Medical. By Variation of Lease made the same day the term of Lease was increased to 10 years to expire on 4 September 2005. Pausing at this point it is plain that on 4 May 1998 the Applicant and the lessees and the guarantors were comfortable with extending the term of the Lease from 4 September 2000 to 4 September 2005. That in itself indicates to me that at least on that date the parties were sufficiently confident that the medical business conducted from the premises could be commercially successful up until 4 September 2005.

54 More importantly however, the Variation of Lease contained this quite specific provision:

“The Rent payable by the Lessees to the Lessor shall be increased on each and every anniversary of the extended term of this Lease at the rate of six per cent (6%) per annum.”

55 Although it is true that the Lease itself contained a similar clause (clause 2.3, Item 3) the plain fact is that the Lessees (and the Guarantors) were sufficiently economically confident to the extent that they could agree to an automatic 6% annual increase in rent. The fact that the bulk billing medical milieu changed adversely some time after 4 May 1998 should not effect the plain and obvious conclusion that all parties were ad idem that proper market rent of the premises for their uses was in accordance with the Variation of Lease 4 May 1998 which, at the risk of repeating myself, was to last until 4 September 2005. So, at least as far as the parties themselves were concerned, the proper market rent of these premises at the relevant times was in fact in accordance with that Variation of Lease. It ill-behoves the Applicant to now complain that somehow or other the market rent for the premises has declined to the extent reflected in the Tosson lease. The plain fact is that the Applicant and Mr Kinley formed the view that the best use of the premises was as a Medical Practice/Centre and limited their market exploration to that use and did not explore the market generally.

56 So, although there has in fact been a form of mitigation (in that the premises have in fact been re let) I am of the opinion that reasonable attempts were not taken by the Applicant to mitigate its losses.

57 I now turn to the case for the Respondent. The onus is on the Respondent. The Applicant cannot recover that part of the claimed damage which is due to their failure to mitigate the loss. Mr Gunning’s evidence is persuasive but in my opinion he puts the bar too high. In his report 2 November 2005 he makes this observation:

“In my experience the lessors/owners of shopping centres or groups of shops are most reluctant to offer a tenant a reduced rental to that which is considered to be the base rent or a rent that is well below the average rent average or justifiable in the centre/group. The reduced rent affects the tenancy/rental balance in the centre/group, lowers the capital worth of the property and is a reference point for subsequent rental reviews in the centre/group. Generally the base rent is maintained and incentives are offered to a new incoming tenant. They can be and are not limited to rent free period and contribution towards fit out.”

58 Generally speaking, I think that is a fair summation of the synergy in a shopping centre. However, I find it impossible to conclude with the same confidence as Mr Gunning that “an annual rental range per square metre of between $550 and $650 per square metre (gross) was achievable for the premises as at July-August 2002” and that as a consequence “a rental of $600 per square metre (gross) for the premises was achievable in July/August 2002”. He has based this opinion “upon the current and rental history “ of the shopping centre and supports his conclusions by references to square meterage rental for the other premises in the shopping centre at the relevant date (or as there near thereto). It is worthwhile referring to that rental evidence: firstly, he makes no reference at all to the Woolworths Supermarket nor to the Liquor Shop. I accept that those areas are peculiarly unique. Woolworths was a key tenant and in cross examination he stated that he had not included Woolworths in his schedule because it was not a “similar shop” as it was necessary to compare like with like. Obviously, Woolworths was the lead tenant and without Woolworths the high rentals achieved for the other shops would more than likely have not been attainable.

59 Secondly, Mr Gunning has, quite correctly, looked at the mix of shops within the shopping centre and looked at what the previous tenant (ie S S Medical and Maxicare Medical) had contracted to pay. Taking the various shops in the Centre in the same fashion as I have set out above (paragraphs [33-37]) at the relevant date Shop 9 (TAB) had a rental square metre of $483.87, Shop 8 (the Dentist) $714.78, Shop 7 (the Hairdresser) $737.32, Shop 5 (the Chinese Takeaway) $734.03, Shop 4 (The Fish and Chip shop) $806.01, Shop 3 (The Delicatessen) $878.35, Shop 2 (the Butchery) $771.60, and then on the left hand side of the Arcade Shop 11 (the Discount Store) $361.88, Shop 14 (the Chemist) $516.37, Shop 16 (the Jeweller) $619.33, Shop 17 (the Bakery) $783.17, Shop 18 (the Tobacconist) $648.11 and the Kiosk (in the centre of the Forecourt just outside Woolworths Supermarket) $1,318.75. Shop 10 (Video Ezy) having no joinder to the Arcade itself but being situate between Shop 9 (TAB) and McDonalds, showed a rental of $405.36.

60 Taking all these matters into account it seems to me fairly plain that the closer one got to the Forecourt and Woolworths the higher the rent. This is understandable. Woolworths is the lead tenant. The TAB (situate on the north eastern side of the Arcade entrance) at $483.87 is itself rather unique and this location is to be contrasted with the discount shop on the other side of the arcade entrance at $361.88.

61 Again, it is almost impossible to compare like with like. For example, the TAB has lettable area of 120sqm whereas the discount shop is 532sqm.

62 Mr Gunning has also helpfully carried out a “Lettable Area and Rental Analysis” in which he demonstrates that at the relevant time the premises (Shop 12) had a lettable area of 180sqm and a rent per square metre of $721.00. Again, this can be (very roughly admittedly) compared to the Video Ezy rent (Shop 10) of $410.00 for 305sqm.

63 If one tries to compare like with like then the premises (Shop 12) is totally unique and cannot possibly compared with any of the other shops referred to in Mr Gunning’s Schedules and from which he draws his conclusions. The reason for this is simply that Shop 12 is firstly, not connected at all with the entrance to the arcade (which clearly is the more attractive and has the highest foot traffic and leads directly from the main carpark to Woolworths supermarket; secondly is opposite a quite small carpark (for which there was some evidence it was used by employees); thirdly, is nowhere near, indeed as far away as one could be, from McDonalds, and is clearly situate in an area in which there would be minimal foot traffic compared to the other shops. It seems to me that these factors should have resulted in a considerable discount by Mr Gunning. I do not accept (however) that the discount should be anywhere near that suggested by Mr Kinley simply because his discounting was based on totally incorrect premises.

What should be the approach of the Tribunal?

64 The Tribunal is then left in this interesting situation. On the one hand it is not satisfied that the Applicant took all reasonable steps to mitigate its losses. On the other hand the onus being on the Respondent, the Respondent has to some degree discharged that onus by demonstrating the failure of the Applicant to take all reasonable steps to mitigate. However, in my opinion the evidence of the Respondent is not such that would satisfy this Tribunal that the correct square meterage rental is as stated by the Respondent’s expert.

65 It is my view that, and in particular having regard to the fact that valuation evidence is not an exact science and that considerable differences can validly exist between the opinions of various valuers, one is left somewhat in the situation in which any valuation court is found every day, and that is doing the best it can trying to find a reasonable valuation having regard to the quite valid differences of opinion and the ranges of valuation that are not unreasonable even among experts.

66 I think in all the circumstances the nearest comparable rental in this shopping centre is probably the Video Ezy shop at $410.00 per square metre and that in itself needs to be discounted for Shop 12 because of the rather peculiar and indeed remote location of those premises but at the same time remembering that the rate per square metre that was payable under the lease at the time the lease was repudiated was $721.00 per square metre. It is also vitally important to remember that the reject shop has a rental of $361.00. The differences between the various tenants indicate that the shopping centre owners have understood the economic necessity for “horses for courses” such that, although I have accepted Mr Gunning’s general observations/opinion as set out in paragraph 56 above, the fact is that in this shopping centre there is a considerable variation in square meterage rentals, which variation seems to depend considerably upon the location of the various lettable premises.

67 It is a difficult balancing act. The key (in my view) is to look at the reject shop (Shop 11) at $361.00, Video Ezy (Shop 10) at $410.00 and the TAB (Shop 9) at $483.00 and then try and move around the corner away from McDonalds and away from the main carpark and away from the arcade entrance to the shopping centre and Woolworths and then look at Shop 12, the premises in issue. Doing the best that I can on the evidence in my opinion the appropriate rental of the premises achievable in July-August 2002 would have been $360.00 per square metre (gross).

68 Forming this opinion I have borne in mind the deduction of costs (of marketing, time required to find a new tenant, any “rent free” period, and so on) that would have been reasonably achievable for the period 31 July 2002 to 4 September 2005. There were some differences of opinion between Mr Kinley and Mr Gunning. I do not think anything particular hangs upon those differences of opinion because in the whole scheme and bearing in mind that one takes a reasonable broad brush approach to this type of exercise, the result would not vary much.

69 I do not propose to carry out my own calculations – I will leave that to the parties and I shall include at the end of the decision give appropriate directions relating to the bringing forward of Short Minutes in conformity with these reasons.

Claim for Commission:

70 The Applicants claim $6,600.00 being the fee of Mr Kinley by way of a commission fee for introducing Tosson. By Management Agreement dated 5 April 2001 between the Applicants and Kinley’s Retail Property Pty Limited the Applicants appointed Kinleys Retail Property Pty Limited “as its agent to manage and lease” the shopping centre. This Agreement was put into evidence in order to support the claim for leasing commission. Indeed, it was only put into evidence after it was called for by counsel for the Respondent. I am unable to see anything in this document that would support a claim for leasing commission. In the Reference Schedule to this document, Item 8, there is an Item called “Leasing Fee” which is stated to be: “Leasing of vacant space or space vacated to a tenant not currently a tenant of the property. 10% of the first years’ gross annual rental reserved in the Lease. Any rent fee periods of other offerings by the Owner as an incentive shall not be taken into account”. If this is the clause upon which reliance is made then, on any view, the leasing commission is certainly not $6,600.00 but rather $4,800.00 (being 10% of the first year’s rent of the Tosson lease of $48,000.00).

71 Mr Kinley sought to support the leasing commission as a charge against the Respondent by relying upon this Management Agreement. However, he agreed that the leasing fee was only chargeable if he successfully introduced the new tenant. The evidence was overwhelming to the contrary – rather, the new tenant was in fact obtained by the Receiver and Manager. I am unable to see any basis for making this claim against the Respondent and I reject this portion of the Applicant’s Case.

Legal Fees

72 The Applicant claims “legal fees to date” in $74,351. In support of that claim the only evidence before the Tribunal is a “Bill Enquiry Print Request” schedule printed out by the solicitors for the Applicant in relation to the matter. This shows Professional Costs in $47,718.50 and Disbursements of $11,317.51, Total $74,351.51.

73 At the hearing counsel for the Respondent called for the documents in support of the print out. Presumably, this was a call for the bills of costs rendered in respect of each Billing Period identified in the schedule. No documents were produced. This is understandable simply because the documents had not been called for prior to the hearing and could have easily have been called for as part of the usual (and proper) pre-trial discovery process if in fact the issue of the Applicants’ legal costs as a recoverable item against the Respondent was really an issue to be tried. The view that I took, and I now confirm, is that any practice of calling for documents at hearing without prior notice to the other party, without pre-trial discovery and in circumstances where it is said at hearing that there is a real issue to be tried on that matter, is a practice to be deplored. Indeed, in my view, and there being absolutely no evidence at all to the contrary led by the Respondent, the issue of the legal costs being chargeable against the Respondent and the quantum thereof is effectively admitted. In this regard I observe that the claim for legal fees is contained in paragraph E 5.4 (ii) of the Application and in his Amended Defence the Respondent “does not admit” this paragraph. However, there being no traversal by way of evidence and no pre-trial discovery (all within the capacity of the Respondent) and the legal costs print-out being admitted not as an exhibit but an aide memoir only, it seems to me that there is no real argument (or any argument at all) that the fees as claimed are the fees as charged against the Applicants and are by the lease contract recoverable against the lessee and consequently against the Respondent as guarantor. The relevant clause is 27.2 of the lease which is in these terms:

“The Guarantor is liable for and indemnifies the Landlord against all liability or loss rising from and cost incurred in connection with a breach or non-compliance by the Tenant of any of the Tenant’s obligations in this or in any extension or renewal of this lease.”

74 In written submissions the Respondent’s legal advisers accepted that it “was not in issue that the (lessee) had an obligation to pay the Applicants’ losses incurred as a consequence of the termination of the Lease.” The submission was that the issue before the Tribunal was whether the Applicants (not the Respondent) had failed to comply with the obligations imposed upon the Applicant by Clause 20.3(b) of the Lease (ie that the Applicant “must take reasonable steps to mitigate its loss”) and consequential matters such that the costs of the proceedings concerned the breach by the Applicant, not a breach by the lessee.

75 In my view Clause 27.2 applies. The Respondent as guarantor is required to indemnify the Applicants “against all liability for loss arising from and cost incurred in connection with a breach or non-compliance (by the lessee) of any of the (lessees) obligations…” The breach is the breach by the lessee by its abandonment of the premises and its non-payment of rent. The phrase “in connection with” is a well known legal phrase intended to “cover the field” in order to ensure as best possible that the lessor is not out of pocket. The loss is made up, inter alia, of the legal costs that the lessor has to pay as a result of the breach or non-compliance by the lessee of its obligations. Put another way, if the lessee had not abandoned the premises and had continued to pay the rent then there would not have been a breach or non-compliance by the lessee of its obligations and the lessor would not have been put to any expense, liability or loss. The legal costs are a natural consequence of the breach by the lessee for which the guarantor is contractually required to indemnify the lessor.

76 In any event there was not the slightest suggestion that the Respondent had paid the amounts admitted as not being in dispute or that the Respondent had offered to pay an amount reasonably assessed as being the true loss suffered by the Applicants: thus the necessity for these proceedings!

77 However, in my view the matter does not end there. In fairness, no party addressed me on this issue and at the end of these reasons I shall reserve to either party to re-list the matter before me if so advised with a view to persuading me that the opinion that I am about to express is not correct. I accept (as I have stated above) the contractual obligation. However, Administrative Decisions Tribunal Act 1997, Section 88 (1) makes it plain that this Tribunal “may award costs in relation to proceedings before it, but only if it is satisfied that there are special circumstances warranting an award for costs”. The Applicant’s claim is made pursuant to Retail Leases Act 1994, Division 3, Sections 70, 71 and the powers of the Tribunal are specified in Section 72. The power to award costs is contained in Section 77A Retail Leases Act 1994 which is the enabling Section pursuant to Administrative Decisions Act 1997 Section 88(3).

78 There is no need for me to review the law relating to what are “special circumstances warranting an award of costs.” It seems to me that the law does not permit this Tribunal to make an order for costs of proceedings before it even if the lease contract creates an indemnity in favour a lessor, in the face of Section 88.

79 It may well be that part of the costs claimed pre-date the commencement of proceedings in this Tribunal – there is evidence to that affect – and it may be that those costs, if properly quantified, are caught by clause 27.2 of the lease; but it seems to me that Section 88 applies to the costs incurred in connection with and/or in respect of these proceedings notwithstanding what the lease contract may say to the contrary. I am unable to find anything in the Retail Leases Act 1994 or the Administrative Decisions Tribunal Act 1997 which would indicate that terms of a lease contract would overcome the terms of Section 88 Administrative Decisions Tribunal Act 1997.

80 In those circumstances in my opinion, but subject to the final orders that I propose to make in this matter, I am inclined to disallow the whole of this portion of the claim subject to any portion that may be properly proved to have been incurred by the Applicant not connected with the proceedings in the Tribunal.

Final Observations

81 The Applicant is entitled to recover from the Respondent the rental arrears of $14,758, the loss of rent in $93,725.27, the outgoings of $59,576.38 the interest of $5,850.31, the last three being subject to re-calculation having regard to my determination of the correct square meterage valuation. The Applicant is also entitled to recover from the Respondent that portion of its legal fees incurred as a result of the Lessee’s abandonment of the premises and non payment of rent but not including legal costs in relation to these proceedings. The Applicant is not entitled to recover the claimed leasing commission of $6,600 but I reserve leave to either party to re-agitate the question of legal costs.

Orders

1. The parties are directed to bring forward Short Minutes of Order in conformity with the terms of this decision. Those Short Minutes should specify the items allowed by this Tribunal in favour of the Applicant, set off the amount paid by Dr Sood and the quantum that should have been set off by way of mitigation in accordance with these reasons.

2. Matter listed for one-half hour at 2-00pm on Monday 30 January 2006 with a view to making appropriate orders pursuant to the said Short Minutes and directions (if required) as a consequence of the leave granted in Order 3. .

3. Leave granted to either party to list the proceedings before me should the party so listing wish to agitate an argument relating to the Applicant’s legal fees contrary to the Tribunal’s expression of opinion set out in these reasons. Absent application to re-list on this issue made to the Tribunal at 2-00pm on 30 January, 2006 the decision of this Tribunal will be a Declaration that the Applicant may not make claim against the Respondent for legal fees incurred in connection with the breach or non compliance by the lessee in relation to legal costs incurred in connection with the application to the Tribunal absent an application and order made pursuant to Section 88 Administrative Decisions Tribunal Act but otherwise the Applicant be entitled to recover against the Respondent their legal costs pursuant to Clause 27.2 of the lease subject to proper quantification.