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Verraty Pty Ltd v Richmond Football Club Ltd

Verraty Pty Ltd v Richmond Football Club Ltd

Case [2020] VSCA 267 16 October 2020

Lease

Statutory Interpretation

Voiding Provisions

Property Law

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SUPREME COURT OF VICTORIA

COURT OF APPEAL

S EAPCI 2019 0118

VERRATY PTY LTD	Applicant
v
RICHMOND FOOTBALL CLUB LTD	Respondent

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JUDGES:	KYROU, KAYE and SIFRIS JJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	1 September 2020
DATE OF JUDGMENT:	16 October 2020
MEDIUM NEUTRAL CITATION:	[2020] VSCA 267
JUDGMENT APPEALED FROM:	[2019] VSC 597 (Croft J)

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LEASE – Premises satisfied definition of ‘retail premises’ in Retail Leases Act 2003 at commencement of lease but ceased to do so during term of lease – Whether lease ceased to be a ‘retail premises lease’ subject to Act upon premises ceasing to satisfy definition of ‘retail premises’ – Appeal dismissed.

LEASE – Effect of voiding provisions in Retail Leases Act 2003.

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APPEARANCES:	Counsel	Solicitors
For the Applicant	Mr A J Myers QC with Mr B K Holmes	Millens
For the Respondent	Mr D G Collins QC with Mr C R Northrop	BSP Lawyers

KYROU JA
KAYE JA
SIFRIS JA:

In 1998, the applicant, Verraty Pty Ltd (‘the Landlord’), leased to the respondent, Richmond Football Club Ltd (‘the Tenant’), a property at 354–364 Stud Road, Wantirna for a term of 10 years commencing on 7 May 1998, with an option to renew for a further term of 10 years (‘the 1998 Lease’).

By a Deed of Variation dated 30 January 2004 (‘the Variation’), the parties agreed to vary the 1998 Lease by extending its term to 20 years, commencing on 7 May 1998 and to other variations as set out in that deed.

By operation of law, the Variation effected the grant of a new lease (‘the 2004 Lease’).

Under the lease, as originally negotiated in 1998 and varied in 2004, the Landlord is entitled to reimbursement for land tax payments (cl 5.2(b)) and a rent review which precludes the reduction of rent and provides for a minimum rental increase of 4 per cent per annum (cl 15.1(b)(i)). However, each clause is void under ss 50 and 35(3) of the Retail Leases Act 2003 (‘the Act’ or ‘RLA’) if the lease is a retail premises lease. It is common ground that, at its commencement, the 2004 Lease was a retail premises lease.[1]
[1]In Richmond Football Club Ltd v Verraty Pty Ltd [2011] VCAT 2104, [62], the Victorian Civil and Administrative Tribunal (‘the Tribunal’) decided that the 2004 Lease was, at its commencement, subject to the provisions of the Act and was properly referred to as a retail premises lease.

The critical issue in this appeal is whether a retail premises lease, subject to the provisions of the Act at the time of commencement of the lease, can at some time in the future cease to be a retail premises lease if the premises are no longer ‘retail premises’ as defined in s 4 of the Act. If this is the case, and if the Act ceases to apply, various consequences follow including the loss of various protections provided by the Act to a retail…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Verraty Pty Ltd v Richmond Football Club Ltd

Details

AGLC: Verraty Pty Ltd v Richmond Football Club Ltd [2020] VSCA 267
Case: [2020] VSCA 267
Decision Date: 16 October 2020

CaseChat Overview and Summary

Verraty Pty Ltd brought an appeal against the decision of Richmond Football Club Ltd, which was upheld by the Supreme Court. The primary dispute concerns the classification and regulation of a lease agreement for premises under the Retail Leases Act 2003. The case revolves around whether the lease remains subject to the Act after the premises cease to meet the definition of ‘retail premises’ during the term of the lease. Verraty argued that the lease should no longer be subject to the Act once the premises no longer satisfied the definition of ‘retail premises’, while Richmond maintained that the lease remained governed by the Act.

The court was tasked with determining the legal implications of the premises ceasing to meet the definition of ‘retail premises’ during the term of the lease. Specifically, the court had to decide whether the voiding of certain provisions in the Retail Leases Act 2003 affected the ongoing applicability of the Act to the lease in question. The central issue was whether the lease automatically ceased to be a ‘retail premises lease’ subject to the Act when the premises ceased to satisfy the definition of ‘retail premises’.

In its reasoning, the court held that the lease remained subject to the Act despite the premises no longer satisfying the definition of ‘retail premises’. The court found that the voiding of certain provisions in the Act did not negate the continued applicability of the Act to the lease. It was determined that the lease did not cease to be a ‘retail premises lease’ subject to the Act upon the premises ceasing to satisfy the definition of ‘retail premises’ during the term of the lease. Consequently, the appeal was dismissed.

The court's decision was upheld, and the appeal was dismissed. This outcome means that the lease remains subject to the provisions of the Retail Leases Act 2003, irrespective of the premises no longer satisfying the definition of ‘retail premises’ during the term of the lease.

Orders