Volley Investments Pty Ltd v Coles Myer Ltd

In the case of Volley Investments Pty Ltd v Coles Myer Ltd, the dispute arose from the collapse of a section of the roof at the Phoenix Shopping Centre in Spearwood, which occurred on 22 April 2002. Volley Investments Pty Ltd, the owner and lessor of the shopping centre, leased the premises to Coles Myer Ltd, the operator of a supermarket within the shopping centre. Following the collapse, Coles Myer Ltd claimed damages for breach of the covenant of quiet enjoyment as stipulated in their lease agreement. The specific issue before the court was whether the collapse of the roof constituted a breach by Volley Investments of the covenant to provide quiet enjoyment of the leased premises.

The court was tasked with determining whether the collapse of the roof, which caused significant disruption to Coles Myer Ltd's business operations, amounted to a breach of the covenant of quiet enjoyment. The covenant in question required Volley Investments to ensure that Coles Myer Ltd could peacefully enjoy the leased premises without interruption or disturbance from the lessor or any person lawfully claiming through the lessor. The court had to consider whether the collapse, even though its cause was unknown, could be attributed to Volley Investments, and if so, whether this amounted to a breach of the covenant.

Upon reviewing the evidence and the arguments presented, the court concluded that the Master had erred in holding that the covenant of quiet enjoyment had been breached. The court found that there was no evidence to suggest that the collapse was caused by any action or omission of Volley Investments or their contractor. The court allowed the appeal, set aside the judgment for summary judgment entered by the Master, and granted Volley Investments leave to defend the claim unconditionally. This decision meant that the case would proceed to a full hearing to determine the actual cause of the collapse and the extent of any damages claimed by Coles Myer Ltd.