1. The Tribunal declares that upon its true construction and in the events that have occurred there is an implied term in the lease dated 14 July 2004 between the respondent as lessor and Roger Cree and Glyniss Cree as lessees with respect to the front section 2 Kallista-Emerald Road, Kallista, more particularly identified in the shaded section in an attached plan that the tenant and the customers of its business may use the parking area at the rear of the premise identified in Planning Permit YR-1996/1244 issued by the Shire of Yarra Ranges as responsible authority under the Yarra Ranges Planning Scheme for the purposes of the tenant's business.
2. The respondent must pay the applicants the sum of $5,050.
3. Costs reserved.

1. This proceeding relates to an establishment which has been variously described as restaurant, tea rooms or café known as 'Cooks Corner' at 2 Kallista-Emerald Road, Kallista. When the present owner of the complex Cooks Corner Kallista Pty Ltd, bought the property in 2004 it commissioned a building survey report from Archicentre Limited. This Archicentre report described the building as having weatherboard and fibro walls with timber and concrete floors and being approximately 80 years old. The property is zoned 'Business 1' under the Yarra Ranges Planning Scheme. The area opposite is a State Forest and the area surrounding the property on its side of the road is zoned 'Green Wedge', a residential zoning. The property is therefore an island sitting amongst non-commercial zonings and uses.
2. The evidence before me did not disclose anything of the building's early history. It did show however that from 1996 onwards there had been a series of permits issued under the local Planning Scheme relative to the use of the premises as a refreshment establishment. On 6 February 1997 the Shire of Yarra Ranges issued Permit No. PE96/1244 which allowed the premises to be used as a restaurant. Condition 16 of this permit stated:

Seating accommodation within the buildings for patrons of the restaurant must not exceed 20 seats except with the further permission of the Responsible Authority.

1. The restaurant was permitted to be open from 8.00 am to 12 pm seven days a week. Condition 13 required the provision of car parks as depicted upon the endorsed plans and Condition 15 required that those parking areas should be 'maintained at all times to the satisfaction of the Responsible Authority and ... not be obstructed or otherwise rendered inaccessible'. The endorsed plans depicted some nine car parks at the rear of the property to be accessed from Grantulla Road which abutted the side boundary of the property. Later, Permit No. YR2006/393 was issued for use of the premises as licensed premises which required an amended car park plan to show:

Layout of car parking in accordance with existing layout [incorporating] nine spaces ...

1. Later, this permit was amended. The amended permit YR2006/393/A modified the permit to use the premises as licensed premises amending the seating accommodation to no more than 56 seats 'except with the further permission of the Responsible Authority'.
2. In approximately 1999 a Mr & Mrs Cree owned and operated the business carried on at Cooks Corner. They lived in a residence which formed part of the premises. By 2004 Mrs Cree was suffering a heart condition which led the Crees to put the premises on the market. They were offering both the freehold and the business for sale. Mr Issy Arieli expressed some interest in purchasing. He holds a degree in civil engineering from Monash University and is a property investor. He saw the property advertised for the first time in the window of an agency in Mt Dandenong but felt that it was overpriced. Later he saw another advertisement for the same property in a local newspaper. He approached the Crees advising them that he had no interest in carrying on the business at 'Cooks Corner' but was interested in purchasing the freehold as an investment. He suggested that he purchase the freehold on condition that the Crees enter into a lease of the front or café portion of the premises with a view to their finding a purchaser for the lease and the business alone. The Crees accepted this proposal.
3. Mr Arieli through his company, Cooks Corner Kallista Pty Ltd entered into a contract note whereby the company purchased the property for $325,000 with a deposit of $16,250 payable on the making of the contract note, namely 4 June 2004 with the balance of $308,750 payable on 1 November 2004. The purchase extended to the land and buildings, existing fixed floor coverings, light fittings, window furnishings and air-conditioners and all items on an inventory list. The sale was subject to two special conditions. The first rendered the sale subject to Cooks Corner Kallista Pty Ltd which was Mr Arieli's nominee under the contract obtaining a satisfactory building report and the second required the Crees to enter into a lease for 'the café area at the front of the building - shaded on the attached plan'. The lease was to be for a term of five years with a commencing rental of $300 per week plus two-thirds of the outgoings of the whole building plus Goods and Services Tax 'with annual increases to be based on CPI'. The special condition included a plan of the building which depicted the front of the building including the entire area designated as 'bathroom' being shaded together with the verandah area.
4. Mr Arieli prepared a disclosure statement pursuant to the Retail Leases Act 2003 dated 18 June 2004. The statement identified the premises as being the shaded area on the attached plan. The only copy which Mr Arieli could produce of this disclosure statement had no plan attached.
5. Cooks Corner completed its purchase of the property on 1 November 2004. Cooks Corner and the Crees executed a lease which was dated in Mr Arieli's hand, 24 July 2004. The lease consisted of the printed sections of the Law Institute standard retail tenancies lease, the schedule and execution clause for that form of lease and a plan. The plan once again identified the non-residential areas of the property by shading or cross-hatching. The plan was subtly different from the one contained in the special condition to the contract note executed in June. One of the relatively faint lines constituting the shading or cross-hatching was terminated approximately half-way across the bathroom and a line in the same form was drawn across the bathroom at 90o to the side walls. The effect of this according to Mr Arieli was to exclude half the bathroom from the demise constituted by the lease. As at the date that the lease was executed there was no wall or partition following the line marked on the plan. According to Mr Arieli this change between the plan in the contract note and the plan in the lease was agreed by the Crees. Neither side called the Crees to give evidence.
6. Neither the plan in the contract of sale nor the plan in the lease included the parking area. Indeed the plan in its entirety whether in its unshaded or hatched part or its blank part covered only the main buildings and did not extend to the area used for parking for the restaurant at all.
7. According to Mr Arieli he had discussions with Mrs Cree and they agreed that she would operate on behalf of Cooks Corner a business in the rear portion of the building in the property which had previously been used as a residence described as a 'healing centre'. Mr Arieli explained that Mrs Cree would be merely a co-ordinator for the centre not one of the 'healers'. One room for instance might be devoted to yoga with a yoga practitioner acting as some form of sub-tenant or licensee. Another room might be devoted to tarot card readings. Mr Arieli said that the Crees were agreeable to the re-definition of the demise under the lease in light of these plans.
8. Once the arrangements were made between the Crees and Mr Arieli's company, Cooks Corner it remained only for the Crees to sell the business which they carried on on the premises and assign the lease which they had entered into to the purchaser of that business. Mr Phillip Crook one of the applicants in this proceeding, says he was acquainted with the premises and with the Crees. He had become aware sometime in 2003 that the business and the freehold were to be sold.
9. According to Mr Crook on or about 7 October 2004 he, his defacto partner, Ms Margaret Raleigh and Anthony Raleigh called at the premises to discuss the sale and purchase of the business. According to Mr Crook, Mr Arieli was present at this meeting. Mr Arieli denies being present at any meeting on 7 October 2004. He says he was overseas and outside Australia on that day. He produced a copy boarding pass showing him travelling to Melbourne by Air New Zealand arriving 12 October. The Crees had offered their business for sale at $20,000 on a walk-in, walk-out basis.
10. Following initial discussions Mr Arieli was called into the meeting. Subject to the dispute about the date on which these events occurred, Mr Arieli agrees that he was present in the restaurant after closing time when the Crees and Mr Crook, Mr Raleigh and Ms Raleigh met to discuss the sale of the business. He was sitting at another table in the restaurant area until invited into the discussion by the Crees. The Raleighs and Mr Crook explained to Mr Arieli their plans for the business. He said he would advise by telephone whether his company as lessor would approve a transfer of the lease to them.
11. No party produced any diary notes of this and other meetings around that time, hence none was especially clear on the date on which various events occurred or which matters were dealt with at which meetings. Mr Arieli said that before the applicants eventually took a transfer of the lease to the premises, there were '1-3 meetings'. According to Mr Crook 'on a date prior to 20 October 2004' the applicants and Mr Arieli had a further meeting on site. Mr Raleigh raised with Mr Arieli the existing toilet arrangements

because he believed it did not meet health and safety standards. At this time, the entrance to the toilet was off the kitchen through an unlockable sliding door and there was no airlock.

1. Mr Crook said he complained that there was no office space available to him. According to Mr Crook, Mr Arieli said he could:

Locate the entrance to the toilet from the kitchen to an existing hallway accessing the rear section of the premises. The hallway was accessed from the existing verandah.

1. According to Mr Crook, Mr Raleigh then asked Mr Arieli to provide an additional toilet 'so there would be separate toilets for men and women'. Mr Arieli according to Mr Crook was willing to carry out those alterations but the applicants 'would have to pay for the costs of an additional toilet'. According to Mr Crook the parties then adjourned to the rear of the premises where the car parking is laid out. Mr Crook said that Mr Raleigh complained about the limited size of the existing car park. He said it was too small given that the applicants intended to apply for a liquor license and increased turnover. Mr Arieli said that he could 'increase the size of the car park by resurfacing the rear garden area with gravel'. According to Mr Crook this proposal was put on the basis that the parties would share the cost equally and the applicants agreed with that.
2. Mr Arieli agrees that the discussion about parking along the lines described by Mr Crook did take place. He says however that it was 'in late 2004 or early 2005'. He said that the discussion was purely theoretical focussing upon what might happen in the future when the applicants applied for a liquor license rather than touching upon the existing parking arrangements. In cross-examination he agreed there was a minor possibility that this discussion took place before the lease was assigned to the applicants. Mr Arieli agrees that he did not on this occasion, whenever the discussion occurred, point out to the applicants that the car park as already laid out was not comprised in the demised premises. He said he felt it was unnecessary to do this because of the purely theoretical nature of the discussion which he was having. He added:

There was nothing expressed by the applicants in the discussion that they were in any way uninformed regarding the fact that the lease did not include parking at the rear of the premises and at no time did they say to me that they wanted to have access to the parking at the rear of the premises.

1. On 25 November 2004 the Crees and the applicants executed a one page contract of sale for the business 'Cooks Corner Tea Rooms'. The agreement provided for a deposit of 10% $2,000 which had been paid on 20 October and the balance to be payable on the day of the contract. The agreement provided for a transfer of the lease to the applicant. On the same day the Crees, the applicants and Mr Arieli's company, Cooks Corner, executed a transfer of lease document in the form of the Law Institute standard. The applicants took possession. Mr Arieli handed the 'lease' of the property to the applicants. This lease as previously noted constituted a number of different pieces of paper. The only version produced before me during the hearing included an execution page separate from the execution page on the proforma standard form but apparently photocopied from that or another Law Institute form which was bound into the middle of the schedule section. The executions on behalf of both the lessor company and the Crees were photocopies.
2. The applicants had told Mr Arieli that they wanted to close the business for approximately three weeks to carry out cleaning, painting and some minor refurbishments with a view to re-opening for the Christmas trade in 2004. According to Mr Arieli they also complained that the floors in the building were substantially uneven and that this required attention. Mr Arieli says that he had had a bad experience with an investment property in Williamstown where it had been necessary to re-stump and he had been required to provide rental rebates and compensation to the tenant, hence he was alive to the need to 'bite the bullet' and told the applicants that he would have the property re-stumped during their initial refurbishment period. In fact he said the work which they intended to do expanded substantially from their initial plans so that a more extended period of shutdown was required. According to Mr Crook it was Mr Arieli's initiative to re-block the premises rather than any complaint from the applicants. In the event, the re-blocking took longer than expected. The contractor commenced work without having obtained the necessary building permit which required work to be suspended until this was attended to. It was not possible for the business to re-open for Christmas and according to Mr Crook this caused the applicants to bring forward a number of their refurbishment proposals. Mr Arieli it will be recalled gave evidence that the carrying out of these further works by the applicants was upon their own initiative and not because of delays caused by the restumping carried out at his initiative as Mr Crook alleges.
3. In September 2005 according to Mr Crook a Mr Ross Micalizzi took up residence in the rear of the premises and established a 'healing centre'. The applicants told Mr Micalizzi that the parking at the rear of the premises was for the use of their business only and was required by the planning permit. According to Mr Crook the healing centre business was then transferred by Mr Micalizzi to a Mr Jeff Watkin. Cooks Corner entered into a lease of the rear portion of the premises with Mr Watkin's company, High Land Credo Pty Ltd. The lease was executed according to the execution page on 3 January 2006. The demised premises were cross-hatched and shaded and represented the balance of the building excluding the area then leased to the applicants. As with the applicants' lease, the lease to High Land Credo Pty Ltd made no reference to parking and identified no parking areas as being available to the tenant.
4. On 1 December 2005 Mr Arieli wrote a letter to the applicants on the letterhead of his company, Cooks Corner Kallista Pty Ltd. The letter was headed 'without prejudice' but it does not seem to be aimed at settling a dispute as distinct from staking out a position. It has not been suggested that it is privileged. If privileged any such privilege has been waived. The letter stated inter alia that:

The [retail leases] Act does not obligate the landlord to provide parking for a retail tenant, regardless of any permit requirements, unless specifically provided for within the lease.

Until further notice, permission is given for you to have the use of the parking area at the rear of the property on a shared basis with the tenant at the rear of the building. Use will be on a first in basis. I would request that in order to provide maximum parking for customers that you and your staff do not use the parking area during opening hours.

1. A later letter by a law firm acting for Cooks Corner, namely Pryles & Co dated 31 May 2007 and addressed to the applicant stated inter alia:

We are instructed that you have been using or caused to be used part of our client's land, which is not part of the above-mentioned premises, as car parking.

We are instructed that you must immediately desist from allowing our client's land to be used as a car park. In the event that you do not comply with this request that our client will fence off that part of his land so as to prevent it being used as a car park.

1. In association with the application for the licensed premises planning permit referred to earlier, Mr Harrison an officer of the Yarra Ranges Shire Council, the Responsible Authority under the Yarra Ranges Planning Scheme carried out an inspection of the premises inspecting inter alia the car parking facility. He regarded the car parks as properly appurtenant to the restaurant and not to the healing centre which was being conducted. The use of the premises as a 'healing centre' whatever that term may mean precisely was in Mr Harrison's view an 'as of right' use under the Planning Scheme but subject to the provision of the car parking laid down by the scheme. Since no such parking had in his view been provided by the healing centre, Council commenced enforcement proceedings which led to the healing centre's ceasing operation. When the Cooks made their application to amend their permit for use of the premises as licensed premises Cooks Corner in a letter signed by Mr Arieli lodged an objection. His objection stated:

I have just been made aware that my tenant at the front of 2 Kallista-Emerald Road Kallista has made a planning permit application for a change in use of the premises.

As the building owner I would like to formally object to this application for the following reasons:

1. I have not been informed and have not consented to any changes to the existing use. 2) The re-zoning allows for the use of the premises as a café and gallery. No other use is permitted. 3) Any changes may have an adverse affect (sic) on the planned use of the rear of the property, and 4) The tenant does not currently have any existing rights within the lease for the use of any car parking on the property.

1. It seems that Council was unpersuaded by this objection because it granted the amendment sought.
2. Item 10 to the July 2004 lease for the restaurant under the heading 'Outgoings which the tenant must pay or reimburse tenant's proportion Building Outgoings' the following appears:

1. The applicants object to this allocation of outgoings. They contend that it is inconsistent with what is required by the Retail Leases Act 2003. They say that their portion of the lettable area of the relevant building is no more than 58% and no outgoings should be allocated to them beyond that percent.

1. The disputes between the applicants and Cooks Corner were referred to the Small Business Commissioner who convened a mediation. According to a certificate which he issued on 17 May 2006 the mediation was unsuccessful. In May 2007 the applicants filed the application commencing this proceeding. That application said that they sought 'compliance with lease and the Retail Lease Act'. Subsequently Mr Mackinnon, solicitor and independent counsel gave notice that he acted for the applicants. In accordance with a direction which I gave on 6 July 2007 he filed a statement of the relief which his clients sought. The application sought first, a refund of outgoings paid by the applicants insofar as they exceeded 58% of the total outgoings for the building. Next, the applicants sought a declaration that Cooks Corner was estopped from denying that they had

Exclusive use and enjoyment of the car parking area adjacent to the rear of the demised premises for the duration of the term of the lease and any renewed term thereof.

1. They sought a declaration that they had been misled and deceived to the effect that 'the premises demised under the lease included the car parking area adjacent to the rear of the demised premises'. They sought determinations that 'the premises demised to the applicants comprise the car parking area adjacent to the rear of the demised premises' and that the lease be varied accordingly. Finally, they sought injunctive relief against Cooks Corner interfering or hindering their

exclusive use and enjoyment ... of the car parking area adjacent to the rear of the demised premises for the duration of the term of the lease and any renewed term thereof.

1. In his closing submission Mr Mackinnon on behalf of the applicant summarised the history of the proceeding. He submitted that I should regard the evidence of Mr Arieli as being unreliable.
2. He submitted first, that the denial by Cooks Corner of any right for the applicant to use the rear parking spaces constituted a derogation from its grant constituted by the lease now vested in the applicant. He submitted that there was a covenant to be implied in the lease that Cooks Corner was precluded from derogating from its grant, hence an injunction should go to restrain it from derogating by excluding the applicants and their customers from use of the parking spaces at the rear. He referred to Project Blue Moon Pty Ltd v Fairway Trading Pty Ltd [2000] FCA 127 and Gordon v Lidcombe Developments [1966] 2 NSWR 9. He submitted that the express terms of the lease supported this contention noting that Clause 2.1.13 constituted a covenant by the applicants to comply with all laws relating to the use and occupation of the premises and Clause 2.2.1 prohibited them from using the premises for any illegal purpose. He submitted that precluding the applicants and their customers from using the rear car parking spaces exposed them to prosecution under the Planning and Environment Act 1987 for breach of permit condition.
3. Next he submitted that Cooks Corner's actions constituted a breach of the covenant for quiet enjoyment of the premises. He said:

A breach of covenant for quiet enjoyment arises where the acts of the lessor are such as to render the demised premises unfit for the purpose for which the premises are intended to be used.

Hawskesbury Nominees Pty Ltd v Battik Pty Ltd [2000] FCA 185

1. Without the parking facility he said the lease was 'sterilised'. He continued:

If forced to cease to trade, the purpose of the lease would be entirely defeated.

1. Next, Mr Mackinnon, picking up on some remarks which I had made, submitted that in light of the definition of 'conveyance' to be found in Section 18 of the Property Law Act 1958 the lease between Cooks Corner and the Crees constituted a 'conveyance' and by force of Section 62 of the Property Law Act 1958:

The right to shared use of the car park passed to the Crees on the grant of the freehold estate.

1. He referred to National Trustees Limited v Long [1939] VicLawRp 7; [1939] VLR 33. He further contended that the terms of Section 62 of the Property Law Act were wide enough to create not merely a right in the Crees and his clients as successors in title to shared use of the car parks but a right to exclusive use of the car park.
2. Mr Mackinnon then referred to the definition of 'common areas' in the lease and Clause 20 of the lease dealing with common areas saying that the parking area 'was intended by the parties to the grant to be comprised in the definition of 'common areas' ".
3. Mr Mackinnon submitted that in any event a right to use the car parking area and 'two contiguous toilets adjacent to the kitchen on the ground floor of the premises' should be implied into the lease in accordance with the celebrated statement of principle by the majority of the Judicial Committee of the Privy Council in BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 52 ALJR 20, 26.
4. According to Mr Mackinnon the discussions which Mr Arieli had with the applicants about car parking constituted misleading and deceptive conduct. He contended that Mr Crook's evidence that these discussions took place before the applicants committed themselves to take an assignment of the lease on 25 November 2004 should be preferred to the contrary evidence of Mr Arieli. He contended that in the circumstances a failure by Mr Arieli to point out in the context of those conversations that the parking area fell outside the demised premises constituted misleading and deceptive conduct. He referred to Demagogue Pty Ltd v Ramensky [1992] FCA 557; (1992) 39 FCR 31; Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd [1982] HCA 44; (1982) 149 CLR 191, 198 and Re Ku-ring-gai Co-operative Building Society (No. 12) Ltd (1978) 37 FLR 134, 167.
5. Mr Mackinnon submitted that the allocation of outgoings made under the lease was prohibited by the Retail Leases Act 2003. He contended that the effect of Section 39 of the Act and the Regulations made there under was that it was impermissible for Cooks corner to charge the applicants more than 57% of the relevant outgoings of the building because their tenancy represented some 57% of the lettable space in the building. He submitted that his clients were entitled to a refund of overpayments by way of adjustment under Section 48 of the Retail Leases Act.

1. In his closing address Mr Arieli stressed that there could be no debate that the parking area fell outside the boundaries of the premises demised under the lease. He said the applicants admitted they were not told that the car park formed part of the demised premises and proceeded on the basis of assumptions. He said there was no evidence that he or his company had deliberately misled the applicant. The applicants were merely victims of the assumptions which they themselves made.
2. As to the issue of the allocation of outgoings Mr Arieli said that both Section 39(2) of the Retail Leases Act and Regulation 10 of the Retail Leases Regulations 2003 stated that the formula laid down in the Regulations 'may' be employed. He submitted therefore that the parties had a choice to adopt some other formula and this had been done.

1. In my view a term should be implied in the lease entered into between Cooks Corner and the Crees to the effect that the tenants and the tenants' customers are entitled to use the car park at the rear of the premises. The law upon the implication of additional terms into formal written contract was compendiously and authoritatively stated by the majority of the Judicial Committee of the Privy Council in BP Refinery (Westernport) Pty Ltd v Hastings Shire Council (1977) 52 AJLR 20, 26 where their Lordships said:

Their Lordships do not think it necessary to review exhaustively the authorities on the implication of a term in a contract which the parties have not thought fit to express. In their view, for a term to be implied, the following conditions (which may overlap) must be satisfied: (1) it must be reasonable and equitable; (2) it must be necessary to give business efficacy to the contract, so that no term will be implied if the contract is effective without it; (3) it must be so obvious that "it goes without saying"; (4) it must be capable of clear expression; (5) it must not contradict any express term of the contract.

1. In the present case a 'lease back' of the café area of the premises was being entered into with the Crees but in contemplation that the lease would shortly be assigned to a purchaser of the business whom the Crees would identify. Access to the car park for the restaurant's customers was essential for its legal operation in accordance with the terms of its planning permit. Clause 2.1.13 was a covenant by the tenants to `'comply with all laws relating to the use and occupation of the premises'. Clause 3.3.17 of the lease obliged the tenants to:

Carry on [their] business efficiently and, subject to any applicable laws, keep the premises open during the business hours which are normal for the permitted use.

1. It is just and equitable therefore that the lease should make provision for parking entitlements which are essential to the tenants' performance of these covenants. Similarly, the provision of the facilities necessary to enable the business on the premises to trade legally is necessary to give business efficacy to the lease. A lease which bore the meaning attributed to it by Mr Arieli would be one which rendered performance of the tenants' obligations illegal. Similarly this parking entitlement is so obvious that it goes without saying. The 'deal' which Mr Arieli made with the Crees was that he would purchase the freehold and they would be left to sell the business which they had been carrying on. This business throughout the term as it was conducted by the Crees, that is, from 1999 onwards and for some years before that had as an essential part of its facilities access to the parking area at the rear; that this facility should continue to be available to enable that business to be conducted in the future by a purchaser from the Crees makes a provision giving tenants and their customers the entitlement to use the rear car park, is so obvious as to go without saying. There is no problem in the clear expression of such a term. In addition it is not inconsistent with any express term of the written lease.
2. Mr Arieli said in answer to a question from me that he had discussions with the Crees as to severing the right to park at the rear from the café tenancy. He said they agreed to this. I am unable to accept his evidence on this point. First, I note that whilst he filed a fairly full and detailed witness statement this element of his dealings with the Crees which in many respects was central to the subject matter of this proceeding was not mentioned; nor was it mentioned in the course of any viva voce evidence which he gave until I asked him a direct question on this point. His answer did not purport to record any particular discussion merely the legal conclusion that the Crees had agreed to the arrangements as to parking. In the context of the present proceeding Mr Arieli had both conscious and unconscious motivation to remember a subject matter in his negotiations with the Crees which was not in fact mentioned. As previously noted the Crees were very keen to sell out in light of Mrs Cree's heart condition. Mr Arieli said he had no discussion with the principal of High Land Credo Pty Ltd when it entered into a lease of the 'healing centre' in January 2006. Of course it was the very issue of parking that led to the closure of the healing centre, at least in the short term. It seems far more likely to me that the Crees, more anxious to negotiate their exit from the property than to be concerned with the detail of arrangements after their left, would not have been concerned and would not have mentioned the issue of parking at all, merely assuming that the arrangements which had obtained since that lease 1996 would continue which is of course what happened for the balance of the Crees occupation of the café and for the first few months of the new tenants' tenure.
3. Concluding as I do that there was upon the true construction of the lease and in the events that had happened an entitlement by the applicants and their customers to use the parking area at the rear there could be no question of misleading and deceptive conduct in the discussions which they had with Mr Arieli in which such an entitlement seemed to be implicit. Had it been necessary for me to make a finding on this point and if I had found that there was no such entitlement, I would have concluded that in all the circumstances for Mr Arieli to have engaged in the discussion which he did with the applicants without advising them that the car parking area which they clearly assumed they would have access to was not theirs as of right would have amounted to misleading and deceptive conduct even although by silence and omission rather than by direct statement. In the event it is unnecessary for me to rehearse the well known authorities culminating in Demagogue v Ramensky.
4. I would also have found that the conversation relative to parking conducted in the parking area itself took place before the applicants committed to the tenancy, that is, before 25 November, when they executed the transfer of lease. First, it is generally more plausible that the applicants would have gone into these matters before committing rather than after. Secondly, I found Mr Crook generally a reliable witness. Mr Arieli conceded that there may have been as many as three meetings between the parties prior to the applicants final commitment to the lease. This was ample time within which the discussion which everybody agrees occurred could have taken place prior to the lease being transferred to the applicant. Finally, a diary note from the file of the law firm which acted for the applicants when they took the transfer of lease dated 3 November 2004 was produced. It included a number of details of the transaction were set out in the note and at the end the following appears:

Both car park and toilet expense to be share (sic) equally - to be dealt with separately.

1. This is consistent with the view that the applicants instructed their solicitor at this point, namely on 3 November as to the discussion relative to car parking which must have taken place before that date.
2. Finally, I should record that I found Mr Arieli's explanation as to why he did not attempt to put the applicants 'in the picture' as to how he saw the car parking situation quite unconvincing. He said it was unnecessary and inappropriate for him to say anything in the course of this discussion as to the existing car parking arrangements because what was being discussed was a hypothetical future car park which might be constructed and laid out at some time in the future. Clearly the discussion about the hypothetical car park proceeded from a commentary to the effect that the applicants found the existing car park inadequate. Mr Arieli's proposal for extending the gravelled areas was a response to this complaint and implicitly accepted the assumption made by the applicants that they had an entitlement to use the existing car park.
3. In the circumstances it is unnecessary for me to say anything as to the right alleged to have passed upon the creation of the lease by virtue of Section 62 of the Property Law Act 1958. I note however that in Halwood Corporation v Roads Corporation (1995) 89 LGERA 280, 293 Batt J (as he then was) said:

A right unknown to the law cannot pass under the general words of S.62.

1. A non-exclusive right of parking could as it seems to me exist as an easement. An exclusive right to car parking would be inconsistent with the concept of an easement. It would not constitute a demise under the lease, hence it would be an interest unknown to the law and one not calculated therefore to pass under Section 62.
2. It is also unnecessary for me to express a view on the contention that excluding the tenants and their customers from use of the parking area would constitute a derogation from the grant constituted by the lease.
3. The final question as to this aspect of the dispute is whether the applicants' entitlements to use the parking area are exclusive or not. Mr Mackinnon's primary contention was that the rights were exclusive. In my view this is not so. In Copeland v Greenhalf [1952] Ch 489 the plaintiff claim a prescriptive easement to park vehicles on a strip of the defendant's land. Upjohn J. held that the claim made by the applicant was so extensive as to amount to a claim for the entire beneficial entitlement to the relevant land. This was inconsistent he said with the concept of an easement. The claim failed. Similarly, here a right to the exclusive use of the parking area would be inconsistent with the right's being an easement. The only other right known to law which would give an exclusive possessory right to the applicants would be a demise, viz. a lease. Here, the area of the demised premises is designated on a plan. There is no application before me for rectification of that plan hence I should treat the plan as properly stating the extent of the demised premises. To claim the exclusive right to use some additional part of the lessor's land would be to claim a right inconsistent with the express terms of the lease. Such a term could not consistently with the BP (Westernport) principles operate an implied term.
4. This brings me then to the claim for the refund of moneys paid by way of outgoings. This claim depends for its success upon the true construction of Section 39 of the Retail Leases Act 2003 and Regulation 10 of the Retail Leases Regulations 2003.
5. Section 39 provides:

(1) The tenant under a retail premises lease is not liable to pay an amount to the landlord in respect of outgoings except in accordance with provisions of the lease that specify-

(a) the outgoings that are to be regarded as recoverable; and

(b) in a manner consistent with the regulations, how the amount of those outgoings will be determined and how they will be apportioned to the tenant; and

(c) how those outgoings or any part of them may be recovered by the landlord from the tenant.

(2) The regulations may prescribe the manner in which the amount of outgoings may be determined and apportioned to a tenant.

1. Regulation 10 is the relevant regulation and it provides:

For the purposes of section 39(2) of the Act, the amount of an outgoing may be determined and apportioned to a tenant by multiplying the total amount of the outgoing by the relevant fraction.

1. The competing contentions are that for the applicants Mr Mackinnon says that the regime laid down by the section of the statute and the regulation is mandatory. The application of the 'relevant fraction' which is elsewhere defined in fairly elaborate terms as being the relationship between the floor area of the relevant premises and the total floor area of the building means that his clients can be liable for no more than 57% of the building's outgoings. This regime, he says, is mandatory and cannot be contracted out of.
2. Mr Arieli however submits that both Section 39 and Regulation 10 use the word 'may'. The effect therefore is, he says, that the percentage regime laid down by the section and the regulation may be contracted out of. Here the Crees did so contract and there is no reason why the agreement which they made should not be given its full effect.
3. The ordinary meaning of the word 'may' is to confer a discretion rather than to impose an obligation. This presumption is reinforced in Victorian legislation enacted since 1984 by Section 45 of the Interpretation of Legislation Act 1984. On the face of it therefore, Mr Arieli's contentions are quite compelling. Under the Common Law rules of interpretation however, the word 'may' has frequently been held despite its prima facie meaning to impose a duty and to have mandatory effect. The best known recent example of this is the decision of the High Court of Australia in Finance Facilities Pty Ltd v Federal Commissioner of Taxation [1971] HCA 12; (1971) 127 CLR 106. The tendency at Common Law to interpret the word 'may' as imposing a duty has been particularly marked when the person who 'may' do something is a public officer performing a public duty, particularly where action by the public officer is necessary to enable a citizen to obtain a legal right.
4. All these authorities and Section 45 of the Interpretation of Legislation Act however must yield to the context. The effect of Mr Arieli's contentions is that Section 39 and Regulation 10 are simply exercises in futility. In the absence of any provision as to apportionment in Section 39 or in the regulations it would have been open to the parties to agree upon whatever apportionment they saw fit. Section 39 by its ordinary words obliges the parties to adopt an apportionment which is consistent with the regulations. According to Mr Arieli the use of the word 'may' in Regulation 10 means that the regulation imposes no mandatory regime whatsoever; hence it achieves nothing. This seems an implausible interpretation though it does gain some plausibility from the fact that the regulation corresponding to Regulation 10, namely Regulation 7(1)(ii) under the Retail Tenancies Reform Regulations 1998, the predecessor of the present regulation provides that the apportionment to a tenant of expenses:

Shall be based on the total floor area of the retail premises as a percentage of the total floor area of all the retail premises in respect of which the expenses are incurred. (emphasis added)

1. In my view the correct interpretation of Section 39 and Regulation 10 is that Section says that the mode of apportionment of outgoings amongst tenants must be 'consistent with the regulations'. The regulations only stipulate one mode of apportionment and that is by reference to the relevant fraction. The operation of Regulation 10 therefore is effectively mandatory even despite the use of the word 'may'.
2. The effect of failure to comply with Section 39 and the Regulation appears to be that outgoings are not recoverable by the landlord at all. Croft Retail Leases Victoria [60,015] page 19,105 (Service 4). Here all that has been sought is a re-adjustment of the outgoings that have already been paid. There seems in the circumstances to be no objection to this lesser remedy being allowed. I asked Mr Mackinnon what restitutionary cause of action he relied upon. It could not be said so far as I can see that these tenants paid any monies under a mistake because from the very early stage they complained about the validity of the apportionment of outgoings to them. Mr Mackinnon contended that Section 48 of the Retail Leases Act gave a statutory cause of action entitling his clients to have the overpayment of outgoings re-adjusted. What Section 48 of the Act supposes will occur is that there should be an adjustment of outgoings following each 12 month period by comparison of the actual expenditures against a contribution made by the tenants. Here, there is no evidence that any such adjustments had taken place so that no accounts have effectively been 'settled' for the purposes of Section 48. In those circumstances and with some hesitation I conclude that it is proper to re-adjust the outgoings as between landlord and tenant in reliance on Section 48 though it is fair to say that the section seems to be more directed to a contrast between projected expenditure and actual expenditure rather than to the issue of apportionment amongst the tenants.
3. Mr Mackinnon prepared a document styled 'Schedule of Outgoings and Overpayments'. This schedule showed a total overpayment according to his calculations and assuming that the 'relevant fraction' apportionment regime was mandatory of $5,050. There was no challenge made to these calculations and so I will adopt them.
4. The final issue which I should mention is the contention that I should give declaratory relief relative to the use of toilet facilities on the property. This was raised so far as I can see for the first time in Mr Mackinnon's closing address. The application originally filed by the applicants acting in person was completely vague and stated no property prayer for relief. I directed that a prayer for relief be filed and the document filed in accordance with my direction made no reference to this issue. The hearing was conducted, until the issue was raised as a matter of relief in Mr Mackinnon's closing address, upon the footing that the issues relative to the toilet facilities were merely background matters and part of the general narrative. Mr Arieli objected to this issue being raised as a substantive one and the subject of relief for the first time so late. I accept that submission. Had this been part of the case before the hearing began, Mr Arieli may have given different evidence. He may have called one or more other witnesses, he may have put other documents into evidence. Certainly I would have viewed the evidence differently, I may have asked and indeed likely would have asked questions of the witnesses on this toilet issue which in the circumstances I did not. In my view it would be contrary to the interests of justice to enable the issue of the toilets to be raised in the manner which it was so late in the proceedings. I put it to one side.

1. I have heard no submissions on the question of costs and so I will reserve them, needless to say this proceeding is governed by Section 92 of the Retail Leases Act 2003 which creates a strong presumption against the award of costs.