Spring Lake Garden Centre Pty Ltd v Ingleton

[2010] QCAT 171

CITATION: Spring Lake Garden Centre Pty Ltd v Ingleton [2010] QCAT 171

PARTIES:	Spring Lake Garden Centre Pty Ltd
v
Mr Barry Edward Ingleton

APPLICATION NUMBER:   RSL003-10   

MATTER TYPE: Retail shop leases matters

HEARING DATE:     12 April 2010

HEARD AT:  BRISBANE

DECISION OF: Ms Anne Forbes
Ms Eleanor Robertson
Ms Michele Alroe

DELIVERED ON: 12 April 2010

DELIVERED AT:      BRISBANE

ORDERS MADE:

It is declared that

1. The lease No 711899870 of Shop 28 Lot 4 on SP 172810 County of Stanley Parish of Staplyton Title Reference 50661687 executed 30 June 2007 between Spring Lake Garden Centre Pty Ltd as Lessee and Barry Edward Ingleton as Lessor was lawfully terminated on 21 December 2009.

It is ordered that:

2.    The Respondent Trustee of the bankrupt estate of the Respondent and the Receivers and Managers of the land on which the shop is situate, together with any successors in title of any of them, are ordered not to demand or otherwise require payment of any monies by the Applicant under the lease or in relation to the occupying or possession of Shop 28 in Spring Lake Metro shopping centre and otherwise described as Lot 4 on SP 172810 in the County of Stanley Parish of Staplyton and the Applicant is not required to pay any of those monies.

3.     The Respondent Trustee of the bankrupt estate of the Respondent and the Receivers and Managers of the land on which the shop is situate together with any successors in title of any of them, are ordered not to demand or otherwise require payment of any monies from Anthony Joseph William O’Connor, Elisabeth Ann Russell, Cedric Earnest Russell in reliance on any guarantee or indemnity given or any agreement made by any of them in relation to the lease to the Applicant or the occupying or possession of Shop 28 Spring Lake Metro shopping centre and otherwise described as Lot 4 on SP 172810 in the County of Stanley Parish of Staplyton and Anthony Joseph William O'Connor, Elisabeth Ann Russell, Cedric Ernest Russell are not required to pay any of those monies.

CATCHWORDS : 

Retail shop lease-implied term-breach – false or misleading statement or misrepresentation-
s 43(2)(a) Retail Shop Leases Act1994

Declaration-jurisdiction of tribunal under enabling Act-not derogated from in Queensland Civil And Administrative Tribunal Act 2009

APPEARANCES and REPRESENTATION (if any):

APPLICANT:	Spring Lake Garden Centre Pty Ltd represented by a director, Anthony O’Connor
RESPONDENT:	Mr Barry Edward Ingleton [a bankrupt person] through the Trustee in Bankruptcy. No appearance.

REASONS FOR DECISION

1. The Applicant tenant, Spring Lake Garden Centre Pty Ltd entered a 10 year lease of the Respondent’s premises in Spring Lake Metro shopping centre [“Metro”] on 15 September 2007. From there it conducted a retail business selling garden wares until it vacated the shop on 21 December 2009. Mr Anthony O’Connor is a director of Spring Lake. The grounds for relief under section 43(2) of the Retail Shop Leases Act1994 (“the Act”) set out in the application lodged on 22 December 2009 and Mr O’Connor’s statement are that the tenant:

i.entered the lease relying on a false or misleading        statement or representation by the Respondent; and

ii.has suffered consequential damage.

1. The respondent has recently become bankrupt.  Receivers and managers of the premises and latterly, a Trustee in Bankruptcy of the Respondent’s estate have been appointed.  Consequently the Trustee Ms Joanne Dunne is the proper Respondent in this dispute. On 24 March 2010 solicitors for the receivers advised the tribunal that they intend to take no part in these proceedings.  The tribunal registry notified the Trustee of the pending hearing by letter on 22 March 2010.  The Registrar’s delegate spoke by telephone a few days’ ago with Ms Dunne, who then confirmed that she has no interest in the matter.  Accordingly then, this hearing proceeds ex parte.

1. The Applicant does not seek compensation. Instead, it seeks:

i.a declaration that the lease was lawfully terminated on 21 December 2009; and

ii.declaratory orders relieving the Applicant and three named people who are guarantors in relation to the lease, from paying any further sums under the lease to the trustee in bankruptcy.

1. At a recent directions hearing three people associated with the lease as guarantors have been admitted as parties. They seek orders effectively releasing them from their guarantee.

THE FACTS

1. Mr O’Connor says that he negotiated the terms of the lease with Mr Ingleton in 2004 when Spring Lake Metro was in the early stages of construction.  According to O’Connor, Ingleton emphasised that Metro was to be different in kind from a nearby centre.  Metro would be a premium shopping centre, described by Ingleton as “upmarket” and “high end”, with a boutique tenancy mix attracting an entirely different target market.  For example, a bread shop would be presented as a “specialty gourmet baker.” The image of the Metro was displayed in glossy marketing material distributed to O’Connor and other likely tenants.  Ingleton represented that three office towers, providing many potential customers, were to be built behind the garden centre. Details of the representations upon which the Applicant says it relied are set out in paragraphs 45-46 of Mr O’Connor’s statement.

1. Lamentably Metro did not meet the representations made on its behalf. Its many defects and differences are stated at paragraph 47 of the O’Connor statement.

1. The tribunal has reminded the parties present at this hearing of their duty of candour on an application such as this, where the Respondent has chosen not to contest the application and the hearing is conducted ex parte.

FINDINGS

1. The Applicant nevertheless bears the onus of demonstrating a prima facie case for relief.  We are satisfied on the material before us that the Respondent represented that its premises would be housed in a centre that would be radically different in kind from the centre that was ultimately built, and would offer facilities to attract high disposable income customers. We are satisfied that the product did not measure up to the representation and that the Applicant reasonably placed reliance on the misleading representation and thereby suffered loss.  Evidence of the extent of the loss is however, somewhat scanty.

1. The Applicant seeks a declaration. The power to make declaratory orders is retained in section 83 of the Act after substantial amendments were made in December 2009 to coincide with the commencement of this tribunal on 1 December 2009. The QCAT Act 2009 restricts the declaratory power to a judicial member: section 60(5). However, it is made clear in the Preliminary Part of the QCAT Act - specifically sections 7(1) and 7(2) – and section 60(4) that it does not derogate from an enabling Act unless explicit provision is made:

“7         Application of Act if modifying provision in enabling Act

(1)  This section applies if a provision of an enabling Act (the modifying provision) provides for-

(a)    the tribunal’s function in jurisdiction conferred by the enabling Act: or

(b)    .................

(2)  The modifying provision prevails over the provisions of this Act, to the extent of any inconsistency between them.”

and

“ 60 Declarations

(3)  The tribunal’s power [to make a declaration] is in addition to and does not limit, any power of the tribunal under an enabling Act to make a declaration.”

1. Our conclusion then is that this tribunal constituted under the relevant enabling Act, retains the power to make declarations.

11.Accordingly it is declared that:

i.The lease No 711899870 of Shop 28 Lot 4 on SP 172810 County of Stanley Parish of Staplyton Title Reference 50661687 executed 30 June 2007 between Spring Lake Garden Centre Pty Ltd as Lessee and Barry Edward Ingleton as Lessor was lawfully terminated on 21 December 2009.

It is ordered that:

ii.The Respondent Trustee of the bankrupt estate of the Respondent and the Receivers and Managers of the land on which the shop is situate, together with any successors in title of any of them, are ordered not to demand or otherwise require payment of any monies by the Applicant under the lease or in relation to the occupying or possession of Shop 28 in Spring Lake Metro shopping centre and otherwise described as Lot 4 on SP 172810 in the County of Stanley Parish of Staplyton and the Applicant is not required to pay any of those monies.

iii.The Respondent Trustee of the bankrupt estate of the Respondent and the Receivers and Managers of the land on which the shop is situate together with any successors in title of any of them, are ordered not to demand or otherwise require payment of any monies from Anthony Joseph William O’Connor, Elisabeth Ann Russell, Cedric Earnest Russell in reliance on any guarantee or indemnity given or any agreement made by any of them in relation to the lease to the Applicant or the occupying or possession of Shop 28 Spring Lake Metro shopping centre and otherwise described as Lot 4 on SP 172810 in the County of Stanley Parish of Staplyton and Anthony Joseph William O'Connor, Elisabeth Ann Russell, Cedric Ernest Russell are not required to pay any of those monies.