City Convenience Stores Pty Ltd v Third Lafite Pty Ltd [2017] NSWCATAP 90 | Case summary

NCAT Appeal Panel|2017-02-16

Introduction

The parties in these two appeal proceedings are City Convenience Stores Pty Ltd ("CCS") and Third Lafite Pty Ltd ("Third Lafite"). CCS occupied retail premises in George Street, Sydney owned by Third Lafite. By a decision of a single Member of the Tribunal, CCS was declared to have occupied the premises as licensee under a licence between 3 June 2013 and 30 May 2014 and thereafter was declared to have remained in and occupied the premises as a trespasser until 4 February 2015 when the owner repossessed them. An order was made by the Member for the payment of outstanding licence fees and an occupation fee quantified by way of damages for mesne profits. The amount said to be payable by CCS pursuant to this decision was $226,295.52.
An appeal was instituted by CCS from the decision of the single Member. In essence, it was the position of CCS that the Tribunal had no jurisdiction and power to determine the matters in dispute between the parties because the statutory basis for such jurisdiction, being the Retail Leases Act ("the Act") did not apply to the occupation by CCS of the premises. A cross-appeal was instituted by Third Lafite to enable it to assert, as a secondary position, that the Act applied and, if the original decision was set aside, as an alternative a retail lease existed which would properly form the basis of a claim for a monetary order for outstanding rent.
In a Decision published on 29 November 2016, City Convenience Stores Pty Ltd v Third Lafite Pty Ltd; Third Lafite Pty Ltd v City Convenience Stores Pty Ltd [2016] NSWCATAP 254 we upheld the appeal of CCS to the extent that we set aside the order for the payment of damages calculated by reference to mesne profits, finding that at all relevant times there existed between the parties a retail lease under the provisions of the Act. Accordingly, we allowed part of the appeal initiated by CCS, set aside the order for payment of monies, but dismissed the arguments advanced by CCS that a retail lease did not exist. Because we had not been provided with sufficient information to enable us to calculate the amount of outstanding rent under the retail lease which we had found to exist, the parties were directed to endeavour to reach agreement as to the calculation of that amount and to file minutes of short orders within 7 days thereafter. We reserved costs. We did not deal at all with any argument that interest was payable on the amount to be awarded.

The monetary award

The parties were unable to reach agreement about the amount payable by CCS pursuant to our Decision. Third Lafite sought a relisting of the proceedings to enable us to hear argument concerning the quantification of the amount payable, and for orders for the payment of costs and interest. That application was heard on 16 February 2016, at the conclusion of which the parties were directed to file further written submissions. To a large extent, the necessity for further submissions arose because of a jurisdictional argument which Mr Soltan, an agent appearing for CCS wished to raise that with respect to some of the period covered by our orders, no rental was payable.
Mr Soltan based his jurisdictional argument on the provisions of section 6A of the Act which is in the following terms; 6A Application of Act to short-term leases Generally, Act not to apply to short-term leases (1) Subject to subsection (2), this Act does not apply to a lease of a retail shop for a term of less than 6 months without any right for the lessee to extend the lease (whether by means of an option to extend or renew the lease or otherwise). (2) Exception for successive, extended or renewed leases for more than one year. If the lessee has been in possession or entitled to be in possession of the retail shop without interruption for more than one year (whether by means of a series of 2 or more leases or by means of an extended or renewed lease or leases, or by any combination of those means), this Act applies to: (a) the lease on and from the day on which the lessee has been in possession or entitled to be in possession of the shop for more than one year, and (b) any succeeding lease or leases of the shop to the lessee, where possession or entitlement to possession is not interrupted. (3) Operation of provisions for disclosure statements Section 11 does not apply to the lease referred to in subsection (2) (a), but applies to any succeeding lease referred to in subsection (2) (b). (4) Operation of provisions for minimum 5 year term Section 16 (1) and (2) do not apply to the lease referred to in subsection (2) (a) unless the lessee notifies the lessor in writing during the term of the lease that the lessee elects to have the benefit of section 16. However, in that case, any period for which the lessee has already been in possession or entitled to possession of the retail shop without interruption is taken to be included in the term of the lease. (5) Operation of other provisions The regulations may provide that, if this Act applies to a lease because of subsection (2), specified provisions of this Act (other than sections 11 and 16 (1) and (2) and Part 2A) do not apply to or in respect of the lease or apply with prescribed modifications. (6) Certain interruptions do not break continuity The regulations may provide that interruptions for a prescribed period or of a prescribed kind are to be disregarded for the purposes of this section. (7) Holding over For the purposes of subsection (1), a provision for holding over by the lessee at the end of the term of the lease does not confer a right on the lessee to extend the lease if it operates at the discretion of each of the lessee and the lessor. (8) Assignment This section has effect in relation to a lease whether or not it is assigned to another person, but if it is assigned the period of possession or entitlement to possession by the assignee is taken to include any period of possession or entitlement to possession by the assignor and any previous assignor.
The factual situation which we found to exist was that CCS commenced to occupy the premises under a license agreement on 3 June 2013. It continued to occupy those premises without interruption until 4 February 2015 pursuant to a number of successive continuing arrangements each falling within the definition of a retail lease. The initial license agreement provided for payment of an occupation fee calculated at the rate of $5500 a week plus GST. Because of the provisions of section 6A(2)(a), the Act applied to the retail lease which was in effect as at the date which was more than one year after CCS had entered into possession on 3 June 2013, namely from 4 June 2014. Accordingly, as our jurisdiction is derived from the provisions of the Act, we do not have power to make any order for the payment of monies arising out of or concerned with a retail lease under the Act with effect prior to 4 June 2014, but we are able to do so as and from that date.
As we understand from calculations which were the subject of agreement between the parties, the amount of moneys payable by CCS for its occupation of the premises under the retail lease which we found to have operated calculated from 1 July 2014 to 4 February 2015 is $172,070.49. From this amount is to be deducted the sum of $26,250 being the amount of a deposit paid by CCS leaving a net amount owing of $145,820.49 for this period.
Mr Soltan furnished us with written submissions well outside the timetable set for the parties. We shall deal with them because we perceive that this is more expeditious than declining to rely on them. In those submissions, Mr Soltan referred us to the provisions of section 6A of the Act. He said that there was contemplated a "notional entry" into a retail shop lease after continuous occupation for more than one year. He then asserted that there was only power to make a money order "as to a liability obligation that arose under this very "retail shop lease" or in connection with use or occupation to which this very "retail shop lease" relates." As best we understand this submission, it requires the identification of a specific retail lease by reference to which possession for a period of more than one year occurred. He said in his written submissions "When an occupant in CCS's position that has been in possession of a (sic) premises under short term leases without interruption for more than one year, an actual entry into a "retail shop lease" occurs under s6A(2)(b) if the lessor grants the lessee any tenancy thereafter." That is, as we understand it, section 6A(2) only applies as and from the entry into a new lease after the 1 year anniversary has expired.
If our understanding is correct, this submission ignores the continuing nature of the arrangements as we have described them in our principal decision and ignores also the provisions of section 6A(2) by which the Act is applied to a series of leases (as defined in section 3) provided there has been continuous possession or entitlement to be in possession. The Act so applies at a time when there has been uninterrupted possession or entitlement to be in possession for more than one year. On this basis, it is not necessary to identify the particular retail lease which was in operation at the time that the Act commenced to apply and the next successive lease entered into after that. All that is necessary is that the several requirements set out in the subsection are fulfilled.
We reject this submission.
In the course of oral submissions we understand Mr Soltan to have raised an argument that, in some way, this Tribunal was not empowered to make an order for the payment of monies by CCS to Third Lafite. We do not understand that this argument was pursued in the written submissions dated 9 March 2017. However, in its written submissions, Third Lafite dealt with the submissions, and least there be any doubt about whether they are still being pursued by CCS, we shall deal with them.
As we understand the submission, it is based on the provisions of section 72 of the Act, which is in the following terms; 72 Powers of Tribunal relating to retail tenancy claims (1) In proceedings for a retail tenancy claim lodged with the Tribunal under this Part, the Tribunal is empowered to make any one or more of the following orders that it considers appropriate: (a) an order that a party to the proceedings pay money to a person specified in the order, whether by way of debt, damages or restitution, or refund any money paid by a specified person, (b) an order that a specified amount of money is not due or owing by a party to the proceedings to a specified person, or that a party to the proceedings is not entitled to a refund of any money paid to another party to the proceedings, (c) an order that a party to the proceedings: (i) do any specified work or perform any specified service or any obligation arising under this Act or the terms of a lease, or (ii) surrender possession of specified premises to another person, or (iii) assign his or her or its rights under a lease to a specified person, or (iv) do or perform, or refrain from doing or performing, any specified act, matter or thing, (d) an order granting a party to the proceedings relief against forfeiture, (e) an order, by consent of the parties, requiring the parties to the proceedings to rectify a lease, (f) an order: (i) declaring any provision made by a lease to be void for being inconsistent with this Act or the regulations, or (ii) declaring that a lessor is not entitled to withhold consent to an assignment of the rights of a lessee, or (iii) declaring the rights and liabilities of the parties under law, whether any consequential relief is or could be claimed or not, or (iv) declaring that a party is or is not entitled to receive payment of the whole or a part of a security bond, (g) such other order, in the nature of an interlocutory order of a kind referred to in paragraphs (a)-(f), as the Tribunal considers proper to be made in order to resolve or assist resolution of the dispute between the parties. (2) The Tribunal may make such ancillary orders as it considers necessary for the purpose of enabling an order under this section to have full effect. (3) The Tribunal may impose such conditions as it considers appropriate when making an order under this section. (4) The Tribunal may make an interim order under this section pending final determination of a claim, if it appears to the Tribunal desirable to do so.
As understood, Mr Soltan argues that the power to order CCS to make a monetary payment must be based on an actual retail lease rather than a retail lease which came into operation pursuant the provisions of section 6A (2). We agree with the submissions made on behalf of Third Lafite that this approach ignores the fact that section 72 is based upon a retail tenancy claim. Such a claim is defined in section 70 (a) as "retail tenancy claim" means any of the following: (a) a claim in connection with a liability or obligation with which a retail tenancy dispute is concerned, being: (i) a claim for payment of money (whether or not stated to be by way of debt, damages, restitution or refund), (ii) a claim for relief from payment of a specified sum of money, (iii) a claim for the doing of specified work or the provision of specified services, (iv) a claim for the surrender of possession of specified premises, (v) a claim for assignment of rights under a lease or for a declaration that a lessor is not entitled to withhold consent to an assignment of the rights of a lessee, (vi) a claim for relief against forfeiture, (vii) a claim regarding the rectification of the lease, (viii) a claim regarding the invalidity of a lease for inconsistency with this Act or the regulations, (ix) a claim for a declaration of the rights, obligations and liabilities of the parties under a lease, (x) without limiting the generality of subparagraph (i), a claim for compensation under section 10, 34, 35 or 62E, (xi) without limiting the generality of any other subparagraph, a claim with respect to the entitlement of a party or former party under a lease to receive payment of the whole or a part of a security bond,
This provision in turn directs attention to a "retail tenancy dispute, which is defined in section 63 (1) of the Act as; "retail tenancy dispute" means any dispute concerning the liabilities or obligations (including any obligation to pay money) of a party or former party to a retail shop lease or former lease, being liabilities or obligations which arose under the lease or former lease or which arose in connection with the use or occupation of the retail shop to which the lease or former lease relates, and (without limiting the generality of the foregoing) includes a dispute about a security bond, but does not include a dispute of the kind referred to in section 19 (1) (b) or 31 (1) (b) as to the rent payable under a retail shop lease (where the rent is to be current market rent for the shop).
This definition in turn, circuitously, is based upon consideration of a retail shop lease. Again, there is nothing which would lead to a construction which would exclude such a lease coming into operation because of the provisions of section 6 A (2) of the Act. Once the Act applies to a retail lease because of the operation of section 6A(2), it becomes a lease for the purpose of section 63(1) of the Act. We reject the submission of CCS to the extent that it argues for a contrary position.
We further understand that as at 30 June 2014 CCS owed the sum of $21,654.29. However, because of the jurisdictional limitation which we have referred to above, we can only order the payment of monies for the period 4 June 2014 to 30 June 2014, a period of 26 days. The parties have agreed that the daily rental amount exclusive of GST is $785.71. Accordingly, there is to be added to the amount of $145,820.49 the sum of $20428.46 representing payment for the further 26 days, making a total of $166248.95.

Interest

Third Lafite claimed interest, relying on section 72 A of the Act which is found in Division 3 of Part 8 and which is in the following terms; 72A Power of Tribunal to award interest (1) When the Tribunal orders on a retail tenancy claim or an unconscionable conduct claim that a person pay money to another person, the Tribunal may order that there is to be included, in the amount ordered to be paid, interest at a specified rate on the whole or any part of that amount for the whole or any part of the period between when the cause of action arose and when the order takes effect. (2) If the whole or part of an amount claimed under a retail tenancy claim or an unconscionable conduct claim is paid during proceedings in the Tribunal on the claim, prior to or without an order for payment being made in respect of the claim, the Tribunal may order that interest be paid at a specified rate on the whole or any part of the money paid for the whole or any part of the period between when the cause of action arose and the date of the payment. (3) The rate of interest specified by the Tribunal under this section must not exceed the rate at which interest is payable on a judgment debt of the District Court. (4) This section does not: (a) authorise the giving of interest on interest, or (b) apply in relation to any debt on which interest is payable as of right whether by virtue of any agreement or otherwise, or (c) affect the damages recoverable for the dishonour of a bill of exchange. (5) On a claim for the payment of money, the Tribunal may not order the payment of interest under subsection (1) in respect of the period after the date on which an appropriate settlement sum (or the first appropriate settlement sum) has been offered unless the special circumstances of the case warrant the making of such an order. (6) For the purposes of subsection (5), "appropriate settlement sum" is a sum offered by a party in settlement of a claim for the payment of money where the amount ordered to be paid (including interest accrued up to and including the date of the offer) does not exceed the sum offered by more than 10 per cent. Subsection (5) does not prevent an award of interest for the period before the settlement offer is made. This provision applies to a retail tenancy claim which is relevantly defined in Sec 70 of the Act, in the following terms; In this Division: "retail tenancy claim" means any of the following: (a) a claim in connection with a liability or obligation with which a retail tenancy dispute is concerned, being: (i) a claim for payment of money (whether or not stated to be by way of debt, damages, restitution or refund),
This definition in turn refers to a retail tenancy dispute which is defined in Sec 63 as; "retail tenancy dispute" means any dispute concerning the liabilities or obligations (including any obligation to pay money) of a party or former party to a retail shop lease or former lease, being liabilities or obligations which arose under the lease or former lease or which arose in connection with the use or occupation of the retail shop to which the lease or former lease relates, and (without limiting the generality of the foregoing) includes a dispute about a security bond, but does not include a dispute of the kind referred to in section 19 (1) (b) or 31 (1) (b) as to the rent payable under a retail shop lease (where the rent is to be current market rent for the shop). (2) This Part extends to apply to: (a) a retail shop lease that was entered into before the commencement of section 6 or under an option granted or agreement made before the commencement of section 6, and (b) a dispute that arose before the commencement of section 6 or which concerns a liability or obligation that arose before the commencement of section 6.
By Sec 3 of the Act a "retail shop lease" or "lease" is defined as follows; means any agreement under which a person grants or agrees to grant to another person for value a right of occupation of premises for the purpose of the use of the premises as a retail shop: (a) whether or not the right is a right of exclusive occupation, and (b) whether the agreement is express or implied, and (c) whether the agreement is oral or in writing, or partly oral and partly in writing. Note: Sections 6, 6A and 84B limit the retail shop leases to which this Act applies.
We agree with the submissions made on behalf of Third Lafite that the order for payment which we have made constitutes an order made on a retail tenancy claim, being a claim in connection with an obligation with which a retail tenancy dispute is concerned, being a dispute falling within the definition of a retail tenancy dispute set out above.
CCS sought to avoid an order for the payment of interest, relying on Sec 72A(5). In so relying, CCS pointed to two occasions on which it asserted it had made an offer to pay "an appropriate settlement sum."
The first occasion occurred in the course of an email exchange between the parties. The first email is dated 6 December 2014 from Third Lafite to CCS. It requested repayment of arrears of $230,854.29. CCS replied on 8 December 2014 stating that the invoiced amount was incorrect, and should have been based on a rental of $12,100 fortnightly inclusive of GST from 1 July 2014. There followed further emails from each party asserting contrary positions. On 9 December 2014 an email on behalf of CCS contained, in part, the following; "If we have any obligation to pay rent, it has to be at the rate of $12,100 per fortnight inclusive of GST. Please amend the Invoice and forward through." This was followed up by a further email from CCS dated 22 December 2014 which referred to the earlier email of 9 December, and said, in part, "We have not received a reply from you. Please issue us with revised account statement to date with the correct fortnightly rent of $11,000 plus GST so that we can attend to payment." The email also stated that CCS was no longer in a position "to long term lease the premises" at the monthly rental then being sought by Third Lafite. No invoice for rental calculated at $11,000 plus GST was provided by Third Lafite.
The question arises whether, in the circumstances outlined above, CCS has made an offer to pay an appropriate settlement sum. The determination of this question is governed by section 72 A (6), set out above. Third Lafite submitted that the email of 9 December 2014 did not constitute a settlement sum offer because it was based upon the issue of a tax invoice which is only referable to payment of GST. Because, however, GST was clearly payable, we do not regard the request for the issue of a tax invoice as detracting from the characterisation of the email as a settlement sum offer. It was clear that CCS was offering to make a payment calculated at the rate of fortnightly rent of $11,000 plus GST. We reject this submission.
There must be some doubt whether the email of 9 December 2014 did constitute an offer to pay. It is prefaced by the words "if we have any obligation to pay rent" and then invited the submission of a tax invoice without indicating whether it would be paid. However, the email of 22 December 2014 is more specific. It states that payment would be made upon receipt of the revised tax invoice. We regard this latter email as constituting an offer to pay a settlement sum.
Third Lafite submitted that the offer made by CCS could not constitute an offer of settlement, because of the absence of any formal claim having been made and, presumably, therefore there was nothing to be "settled." We regard the correspondence between the parties at that stage as constituting a claim by Third Lafite for payment of outstanding rent at a higher amount than that payable under the original license agreement. Accordingly, the offer to make payment at the lower, existing level, would in those circumstances constitute an offer by way of settlement of the claim for a larger amount. Furthermore, we do not regard the request for the issue of a tax invoice as detracting from the characterisation of the offer as being one of settlement. As GST was clearly payable, the issue of a tax invoice was required by law, and even though CCS could have paid the outstanding monies calculated to that date without the issue of a tax invoice, it was not unreasonable for it to have requested a tax invoice in all the circumstances. Accordingly, we reject the arguments of Third Lafite that the email exchange and in particular the email of 22 December 2014 did not constitute a settlement offer.
Third Lafite also submitted that the offer contained in the email did not constitute an "appropriate settlement sum" which is defined specifically, because the offer made did not exceed the sum awarded by us by more than 10%. Indeed, leaving aside the question of interest, the sum offered was precisely in the same amount as ordered to be paid by us.
The manner in which similar provisions in s 100(4) of the Civil Procedure Act operate was described by the NSW Court of Appeal in Illawarra Hotel Company Pty Ltd v Walton Construction Pty Ltd (No 2) [2013] NSWCA 211 (Meagher, Barrett and Ward J JA) as follows; 26 Section 100(4) operates where an "appropriate settlement sum" has been "offered ... by the defendant". Because the December 2008 offers were made by Illawarra, their relevance, for s 100(4) purposes, is limited to the aspect of the proceedings in which Illawarra was "the defendant", that is, Walton's proceedings on the summons. The question whether the offered sum was an "appropriate settlement sum" therefore turns upon a comparison of that offered sum with the sum which, in respect of the summons, is "the amount for which judgment is given including interest accrued up to and including the date of the offer". 27 The amount for which judgment was given against Illawarra and in favour of Walton was $513,025.99 inclusive of interest of $129,527.78 to the date of judgment. Had interest up to only 11 December 2008 been included, the judgment sum would have been $366,944.18. 28 The sum offered by Illawarra in December 2008 was $260,000 (plus costs). That sum, plus 10 per cent of it, is $286,000 (plus costs). If the costs element is ignored (since the judgment sum with which the comparison is to be made obviously does not include costs), the comparison is between a judgment sum of $366,944.18 and an adjusted offer sum of $286,000 and it is seen that the judgment sum exceeds the offered sum (plus 10 per cent), so that the offered sum does not satisfy the definition of "appropriate settlement sum".
The position in these proceedings is that CCS was ordered to make payment to Third Lafite at the rate of $5500 per fortnight (GST is not taken into account). The email of 22 December 2014 contained an offer to pay that amount, as we have found. Interest is less than 10%. On this basis, the amount ordered by us to be paid does not exceed the amount of the offer, together with interest, by more than 10%. Accordingly, an "appropriate settlement sum" as defined having been offered on that date, interest cannot be awarded as and from that date unless "special circumstances" apply.
Third Lafite relied on five matters as constituting either alone or in the aggregate special circumstances for the purpose of section 72 A (5) and thus entitling it to an award of interest notwithstanding our finding that an appropriate settlement offer had been made. These are; a. the fact that even though CCS acknowledged as at 22 December 2014 that it owed money at the lesser rate, being the occupation fee payable under the original license agreement, no effort was made at any stage to pay outstanding monies except, apparently, the sum of $26,250 which was the release by the agent in February 2016 of the deposit originally paid by CCS. We would add to this conduct the fact that CCS maintained during the course of the appeal proceedings that this Tribunal lacked jurisdiction and power to deal with the matter because no retail lease existed as contemplated by the Act. Such an argument would prima facie suggest that CCS was denying any obligation to make payment of an occupation fee recoverable in this Tribunal notwithstanding that it had the benefit of trading from those premises for a long time. b. The fact that the parties are corporate entities and in dispute over a significant sum. We do not regard these matters as constituting per se special circumstances warranting an award of interest whether taken alone or in the aggregate with the totality of the circumstances pertaining to these proceedings c. The fact that the proceedings were commenced by CCS after eviction "(as distinct from Third Lafite)". In the absence of any elaboration in the written submissions of Third Lafite, we do not understand how this matter could warrant the characterisation of special circumstances d. "the ongoing obfuscation and elongation of the proceedings by manipulative design such as numerous unsuccessful interlocutory applications by CCS, referral to the small business Council for mediation, failure to (sic) by CCS to comply with orders for, for instance, the service of submissions and late applications for adjournment." It is true that CCS has acted tardily in complying with the directions which we issued at the time that we published our original reasons for decision. For reasons which we do not understand CCS endeavoured to refer the quantification of the claim for mediation rather than relisting the proceedings before us, if quantification was indeed in issue. We are unaware of the detailed history of the proceedings before the single Member, and in the absence of any specific information it would not be appropriate for us to take the allegations made by Third Lafite as to the conduct of CCS into account.
Whether special circumstances exist is a matter of impression and the exercise of a value judgement having regard to the context and the circumstances in which this exercise is to be undertaken. The awarding of interest by statute is intended to compensate a party who has been kept out of an entitlement to the payment of money from the point of time when it should have been paid. A similar provision was considered by McCallum J in the Supreme Court of NSW in Perpetual Trustee Company Limited v El-Bayeh (No. 2) [2011] NSWSC 1049. Her Honour said; 39 Section 100(4) directs attention to the need to consider the offer inclusive of interest up to the date of the offer but makes no reference to costs. It may be concluded that the section speaks only to the adequacy of the quantum of damages offered (shorn of the complexities of costs). The section may thus be seen as a soft encouragement to accept adequate offers by the relatively mild sanction of depriving a recalcitrant offeree of the time value of his money from the point when he could have had it. More draconian consequences are visited upon a party who unreasonably refuses to accept an offer that comprehends the position as to costs.
Accordingly, it is necessary to consider whether the circumstances revealed in paragraph a. above would constitute special circumstances that would entitled Third Lafite to the payment of interest notwithstanding the offer made by CCS on 22 December 2014. Prima facie, there must be some sympathy for the circumstances of Third Lafite which has been deprived of its monies for some considerable time. However, the circumstances which applied to the ongoing negotiations between the parties which we have detailed at some length in our earlier reasons for decision are indicative that Third Lafite moved at a leisurely pace in conducting those negotiations and that demands for the payment of outstanding rent were few and far between. In all these circumstances, we are unable to conclude that special circumstances exist which would warrant entitlement by Third Lafite to the payment of interest from and after 22 December 2014.
We conclude therefore that Third Lafite is entitled to interest on the amount owing to it pursuant to our order, calculated from the date claimed by Third Lafite namely 1 July 2014 up to and including 21 December 2014. Such interest is payable as calculated at District Court pre-judgment rates, which we understand the parties to have agreed is at the rate of 6.5% per annum.
Having so found it is unnecessary that we consider the arguments of CCS based on the second incident, being an alleged offer of settlement dated 7 June, 2016.

Costs

It is not in dispute that we are entitled, if appropriate, to make an order for the payment of costs of these appeal proceedings. In essence, both parties have been partly successful and partly unsuccessful in the appeal proceedings. Third Lafite has suffered a reduction in the amount which it is entitled to recover from CCS. In the same way, CCS is now liable to pay a lesser amount to Third Lafite. However, CCS has been singularly unsuccessful in its primary argument that the Act does not apply to the circumstances of these proceedings. If that argument had succeeded, Third Lafite would not have been entitled to the benefit of any order for payment of monies made by this Tribunal.
Whether and to what extent any cost order is made will reflect the overall success and failures of the respective arguments put by the parties in the context of the overall result. This involves the exercise of a value judgement. In our opinion, an appropriate costs order in connection with these appeal proceedings is that CCS should pay one half of the costs of Third Lafite. Such an award would reflect the overall result, having regard especially to the strongly argued position of CCS that this Tribunal lacked jurisdiction because no relevant retail lease existed. That argument occupied a substantial part of the proceedings. We propose to order accordingly.
As Third Lafite has been substantially successful in the further proceedings the subject of these reasons for decision, it is entitled to a substantial amount of its costs, which we assess at 75%.
We observe that the costs orders which we shall make are not intended to disturb or detract from the costs order made by us in the course of dealing with the appeal proceedings to the effect that Third Lafite is to pay the costs of CCS thrown away by reason of the adjournment necessitated by the leave granted by us to it to file a cross-appeal.

Orders

We make the following orders;
CCS is to pay Third Lafite the sum of $166248.95.
CCS is to pay Third Lafite interest on the sum of $166248.95 calculated at the rate of 6.5% from 4 June 2014 to 21 December 2014 being 201 days, namely $5950.80.
CCS is to pay one half of the costs of Third Lafite of both appeal proceedings assessed in default of agreement.
CCS is to pay 75% of the costs of Third Lafite of the further proceedings which are the subject of this Decision assessed in default of agreement. I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 28 April 2017

City Convenience Stores Pty Ltd v Third Lafite Pty Ltd

At a glance

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Decision date

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Judgment (5 paragraphs)

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Cases Cited (3)