Bensons Funds Management Pty Ltd v Body in Balance Chiropractic Pty Ltd [2015] VSCA 198

1 The applicant, Bensons Funds Management Pty Ltd ('Bensons') leases premises at 4/787 Dandenong Road, East Malvern to the respondent, Body In Balance Chiropractic Pty Ltd ('Body in Balance'). The lease was for five years to June 2015 with an option for a further five years. Body in Balance claims to have exercised the option. Bensons has decided to redevelop the complex in which the leased premises are situated.

2 There is a dispute between the parties which is the subject of a proceeding in the Victorian Civil and Administrative Tribunal. That proceeding is listed for hearing on 10 August 2015.

3 On 8 December 2014, Body in Balance succeeded in obtaining an interlocutory injunction restraining Bensons from taking possession of the leased premises. An undertaking as to damages in the usual form was given by Body in Balance. Bensons sought to "extend" the undertaking so that it included Dr Bianca Jane Beaumont on the grounds that Body in Balance was a company of limited liability and that Dr Beaumont was the guarantor under the lease and the sole director and shareholder of Body in Balance. That application was misconceived. Dr Beaumont could not be compelled to give an undertaking. In effect, what Bensons was seeking was an order that the injunction be discharged if Dr Beaumont did not give an undertaking as to damages. In any event, the Tribunal refused Bensons' application.

4 Bensons applied for leave to appeal from the order of the Tribunal under s 148(1)(b) of the Victorian Civil and Administrative Tribunal Act 1998. The application for judicial review of the Tribunal's decision was based upon an alleged error of law by the Tribunal in:

(a) failing to apply the general legal principal that an adequate undertaking as to damages is the price of the grant of an interim injunction;

(b) relying on matters that were irrelevant to the decision; and

(c) relying on a finding ostensibly made on 8 December 2014 when no such finding had been made.

5 The application for leave to appeal was refused and Bensons was ordered to pay the costs of Body in Balance. Bensons seeks leave to appeal from the judge's orders.[1]

6 There are six proposed grounds of appeal which may be reduced to two issues; first, whether Bensons must positively establish that damage would be suffered as a result of the injunction before an adequate undertaking as to damages was required; secondly, the strength of the evidence as to damage before an undertaking will be required.

7 For leave to be granted, it is necessary for Bensons to establish that its application has a prospect of success which is real in the sense that it is not fanciful.[2] We are satisfied that there is a real prospect of success in that sense. However, that is not the end of the matter, for the Court retains a discretion as to whether to grant leave.[3]

8 There are a number of matters of significance in this respect. First, the substantive hearing of the dispute is to take place before the Tribunal in two weeks' time. If the case is not concluded quickly, the Tribunal member will be well placed, having heard the evidence, to know whether it is appropriate for the injunction to be dissolved if an undertaking from Dr Beaumont is not given. Secondly, any undertaking as to damages that would now be required could not, on the applicant's own analysis, take effect any earlier than 16 April 2015 when the originating motion seeking judicial review was filed. Thirdly, there is already an undertaking in place by the tenant which is a trading company and which has some assets. Fourthly, a hearing date of 17 March 2015 had been set for the Tribunal hearing which was a date well before the expiration of the first term of the lease. That hearing date was vacated with the consent of Bensons.

9 In the circumstances, we are not satisfied that there will be substantial injustice if leave to appeal is refused. Consequently, we would refuse leave to appeal.

10 We should not be taken to endorse or not endorse the approach adopted by the Tribunal member, nor by the judge.

[1] Orders made 22 June 2015; Bensons Funds Management Pty Ltd v Body in Balance Chiropractic Pty Ltd [2015] VSC 280.

[2] Supreme Court Act 1986 s 14C, Kennedy v Shire of Campaspe 2015 VSCA 47 [19].

[3] Kennedy v Shire of Campaspe 2015 VSCA 47 [14].