Spuds Surf Chatswood Pty Ltd v P T Limited [2003] VSC 410 | Case summary

REASONS FOR DECISION Issues To Be Decided 1 There are two interlocutory issues that are now before this Tribunal for determination. 2 The first issue is whether an injunction granted 24 October 2006 and subsequently extended on numerous occasions ought to be further extended and, if so, upon what terms. 3 The second issue is whether an order for costs made against the Applicant on 12 April 2007 should be the subject of a further order to the effect that such costs be assessed and paid forthwith, alternatively some form of security be offered by the Applicant. Background 4 By Application filed 12 October 2005 the Applicant sought various orders. At the outset it is worth observing that the form of Application in itself does not state with specificity the precise name of the Applicant but rather refers to its director Ms Mimis-Weeks as perhaps one of the Applicants although the company name is also referred to in the same part of the formal Application. The confusion is compounded by the appellation given to the Applicant in the Application for Urgent Interim Order filed 18 October 2006 in which the Applicant is described as "Elizabeth Mimis-Weeks from Spuds Surf Chatswood Pty Limited". However, subsequent documentation and the form of the asserted lease contract tendered by the Applicant makes it plain that it is the company Spuds Surf Chatswood Pty Limited which is in fact the Applicant. 5 The Applicant occupies leased premises in a shopping centre described as "Shops 415, 416 and 417 - Westfield Shoppingtown Chatswood" being part of the land in Certificates of Title Volume 8655 Folio 87 and Folio Identifier 2/879701. The Respondent is the lessor of those premises. 6 Before presenting a recitation of relevant facts it is important to recognise that the proceedings before the Tribunal now the subject of this Decision are of an interlocutory nature only such that any recitation of facts or findings of facts do not amount to some of form of issue estoppel or res judicata but rather are recitations and findings for the purposes of considering whether or not the Tribunal should make any further or other interlocutory orders pending final hearing. Consequently, no recitations/findings made by me can, nor should, bind the Panel (this being a combined retail tenancy and unconscionable conduct claim). The Respondent, quite properly in my respectful opinion, adopted the view that the material that was sought to be led on behalf of the Applicant was material that should not be challenged; similarly, the Applicant adopted a similar approach; such that in both cases material was put before me that may, at the ultimate hearing, be the subject of challenge. 7 Not only do I observe there was no cross-examination but in addition I admitted into evidence a draft expert witness report (with accompanying correspondence) on the basis that it demonstrated that, not only had an expert been engaged by the Applicant and had presented a draft report, but in addition the expert had at least reached some preliminary opinions and I accepted that, at least at this point of time, that may well be relevant on whether previous interlocutory orders ought to be extended. I accept that at the final hearing such a document would not be admitted into evidence and I also accept that Administrative Decisions Tribunal Act 1997 Section 73(2) does not open the door to throwing away the rules of evidence, but I am also mindful of Section 73(3), (4)(c), and (5)(a) and (b). And therefore, having regard to the relatively limited nature of the tender of the draft report it seemed to me appropriate to allow it into evidence on this interlocutory application only. Application 8 The Application filed 12 October 2006 is a combined Retail Tenancy and Unconscionable Conduct Claim under Retail Leases Act Sections 71 and 71A. The grounds of the Application may be summarised as follows: 9 The Applicant asserts that the Respondent engaged in misleading and deceptive and unconscionable conduct by assuring the Applicant that the premises (unparticularized but now, in the more recent affidavits and in submissions, clarified as) Shop 417 would remain visible from the car park entry (called "the blue level carpark") to the particular floor in the shopping centre on which Shop 417 is situate with uninterrupted pedestrian traffic flow. The Applicant asserts that at the time of the lease in question "there were no casual or permanent kiosks" in front of Shop 417. It is further asserted that there was a breach of Section 34 created by the action of the Respondent in blocking Shop 417 "with numerous casual leasing sites followed by permanent kiosks" thereby inhibiting and altering to a substantial extent the flow of customers to Shop 417. Various other asserted breaches of section 34 are pleaded. It was further pleaded that by "erecting casual leasing sites and permanent kiosks (the Respondent had) significantly impacted on the (Applicant's) business resulting in a significant drop in trading figures and foot traffic into (Shop 417)…. (because presumably the Applicant's) sightlines which were unobstructed from the (car park entry) when the lease was entered into were subsequently blocked by the (Respondent) placing the permanent kiosks in front the (Applicant's)doorway (to Shop 417). 10 It was also pleaded that the various kiosks to which objection was taken were "above the height requirements that Westfield have provided in their own fit out requirements guide"; that there was a breach of section 18.1 of the lease (the covenant for quiet enjoyment) in that "the building of the said kiosks, which serve to block (Shop 417) effects the (Applicant) and effects the quiet enjoyment of (Shop 417)." Furthermore, it was pleaded that the Applicant through its representative "misrepresented the size of Shop 417 such that "the rental being paid does not represent accurately the premises being occupied"; furthermore breaches of Section 62B (relating to unconscionable conduct) were asserted, it being pleaded that the Applicant through its centre manager represented that a competitor of the Applicant "wanted to gain tenancy to the centre", that the Respondent "had been trying to secure this competitor in the store and get the (Applicant) out of the centre… (and) "that the (Respondent) would attempt to evict (the Applicant)"… (and)" this amounts to unconscionable conduct" because it was asserted that the Applicant "subsequently had a serious buyer that wanted to buy the business, however (the Respondent) refused to accept this as they were protecting the interests of the competitor….and wanted them in the centre instead." It was further pleaded that the Respondent "was undertaking refurbishment in the centre's food court, which did not eventuate" such that those representations "caused the (Applicant) to put off downsizing and the (Respondent) subsequently withdrew the offer to downsize again coinciding with the (Respondent's) discussions for the competitor to enter the centre." 11 Finally, the Applicant pleaded that the Respondent had "issued a lock out notice for rental arrears however part of the sum claimed as owing included an amount the lessor stated had been owing for some 12 months, (that) this amount was not in fact owed by the (Applicant) and had never been billed to the (Applicant) or appeared as outstanding on the (Applicant's) rental statement, (and that) this further constitutes unconscionable conduct by the (Respondent)". 12 The Applicant sought a number of orders: declarations that the Respondent had breached Retail Leases Act 1994 Section 34, clause 18.1 of the lease, Retail Leases Act Section 62B (in numerous sub-sections), an order under section 8, an order for compensation under section 34, refund of asserted overpaid rental and finally "an urgent interim order that the (Respondent) not be permitted to re-enter the premises (here presumably referring to all 3 shops) or determine the lease until such time as the matter is heard." 13 I have set out the above in some detail for two reasons: firstly, it is important on an interlocutory application to understand with some specificity and precision what are the assertions of the Applicant for principal relief and, secondly, to identify, or attempt to identify, what in my view requires amendment by the Applicant so that the Panel and the Respondent are absolutely clear on what precisely the Applicant asserts and what precise relief is sought. In my opinion, and having regard to the documentation that has now been filed (and to which I make reference below) the Applicant ought to be granted the opportunity, if so advised, to amend its Application. 14 Finally, by Application for Urgent Interim Order filed 18 October 2006 the Applicant formally sought the following, rather curious, Urgent Interim Order: "Urgent Interim Order required as our client has been threatened with a lockout on Wednesday 18 October 2006 at 5.00pm." That in itself of course does not take the matter much further - what was really being sought was a stay by way of injunction consistent with Retail Leases Act Section 72(4) and also perhaps Administrative Decisions Tribunal Act Section 85. In my opinion an Applicant seeking relief under Section 72(4) should not simply seek an "Urgent Interim Order" but should seek the appropriate relief that the Tribunal is being asked to grant in relation to the specific facts that are asserted by the Applicant. Progress of the proceedings thus far 15 The use of the word "progress" might be more than a trifle generous. Not a great deal has happened since the Applications were filed 12 and 18 October 2006 by way of moving the proceedings forward, although I do note that the Applicant has now consulted new solicitors and engaged new counsel such that the matter now seems to be progressing in a more orderly fashion than was perhaps previously the case. 16 The matter first came before the Tribunal 24 October 2006. The Tribunal was at that point of time constituted by myself. I directed that the Applicant file its affidavits, lease, disclosure statement and particulars of the asserted unconscionable conduct, by 21 October 2006. I then made the following interlocutory order: i. Respondent is restrained from taking any steps to evict the Applicant from the premises Shops 415, 416 and 417 Westfield Shoppingtown Chatswood, pending further order. ii. Liberty to apply, any application with respect to rent to be returnable 23 November 2006. iii. Grant of relief is on the basis that the Applicant pay to the Respondent on account of rent $50,000 on 24 October 2006, the balance including accruing rent by 31 December 2006. iv. Note mediation has taken place without success. v. Vacate the directions hearing then fixed for 16 November 2006 and the matter adjourned for further directions to 23 November 2006. 17 At that particular time (24 October 2006) Mr Angyal SC for the Respondent put before me a rental reconciliation which indicated that the Applicant was indebted to the Respondent for outstanding rent as at 23 November 2006 in $130,616.86. 18 The matter then came before me on 23 November 2006. I was informed that the Applicant had filed all material upon which it would rely but I directed that, in order the give the Applicant as much opportunity as possible in order to present its case, that it file any additional affidavits, the disclosure statement and particulars of the asserted unconscionable conduct by 24 November 2006; the Respondent to file its affidavits in reply by 28 February 2007; I continued the restraining order made 24 October 2006 until further order and I varied Order (iii) made that day by deleting "31 December 2006" and substituting "17 December 2006"; I granted liberty to apply and adjourned the matter for further directions to 18 December 2006. 19 On 18 October 2006 I again varied Order (iii) above by deleting "the balance including accruing rent by 31 December 2006" and substituting "$80,000 by 17 December 2006"; I granted liberty to apply an adjourned the matter for further directions 18 December 2006. 20 On 18 December 2006 I delivered an ex tempore judgment in relation to the continuation of the injunction previously granted 24 October 2006. I continued the restraining order/injunction and in addition I ordered the Applicant to pay the Respondent on account of arrears of rent $50,000 by 12 January 2007, rent in $53,000 by 6 February 2007 and rent in $53,000 by 2 March 2007 and adjourned the matter for further directions 8 March 2007. 21 On 8 March 2007 the matter came before Judicial Member Fox. The learned Judicial Member ordered the Applicant to pay rent of $35,000 by the 4 April 2007, continued the injunction previously granted 24 October 2006 and set the matter down for hearing for four days commencing 16 April 2007 and listed the matter for further directions 12 April 2007. 22 On 12 April 2007 the matter came before Judicial Member Higgins who, having heard argument, vacated the previously fixed hearing dates and ordered the Applicant to pay the Respondent's costs thrown away in respect to the adjourned application and noted that the Respondent reserved the right to seek its costs thrown away as a result of the new evidence that was filed. I shall aver to this later. Certain further directions were made with regard to the filing of further evidence in chief and in reply and the learned Judicial Member continued the restraining orders of 24 October 2006 "on condition that the Applicant pay rent of $53,000 on 1 May 2007 and a further $53,000 on 1 June 2007." It is worth noting that on that day the Judicial Member was informed that the Applicant's evidence was "not complete" with regard to liability, causation and damages, that new solicitors had been briefed in April and that the Applicant's counsel was not available for the fixed hearing dates. Additional time was apparently required in order to prepare further and all the evidence. The Judicial Member was also informed that arrears of rent were then in total $125,000, that the Respondent had put on expert evidence and would now have to re-assess. 23 The matter then came back before me on 3 May 2007. The Applicant was then represented, and continues to be represented, by Mr Zipser of counsel, freshly briefed on its behalf. On that occasion I made some additional formal directions requiring the Applicant to file any additional affidavits by 11 May 2007; I continued the restraining order made 24 October 2006 until 21 May 2007; I reserved costs; I directed the Applicant to comply in full with the terms of a Summons to produce documents file 20 March 2007 no later than 11 May 2007 and I adjourned the matter for hearing before me to 21 May 2007 on the question of whether the restraining order should be continued further and, if so, upon what terms. 24 When the matter came before me on 21 May 2007 there were three matters agitated: firstly, whether the restraining order should be continued and, if so, upon what terms; secondly, whether the costs order made by Judicial member Higgins on 12 April 2007 should be varied by including a direction/order that the Respondent's costs be assessed and paid forthwith and/or provision for security; and thirdly, whether in the whole of the proceedings an order for security or costs should be made in favour of the Respondent. Evidence on the Interlocutory Hearing 25 The Applicant filed in the Tribunal at the hearing two additional affidavits, both of a director of the Applicant Ms Elizabeth Mimis-Weeks, one sworn 3 May 2007 and the other 15 May 2007. In addition, the Applicant relied upon a draft expert witness report, unsigned but dated 14 May 2007, to which were annexed the original instructions to the expert 10 May 2007 from the Applicant's new lawyers and a letter to the solicitors for the Respondent 18 May 2007 offering an explanation regarding the engagement of the expert. Mr Zipser of counsel for the Applicant kindly took me through, in detail, the evidentiary material and handed up written submissions. Written submissions were also handed up by senior counsel for the Respondent Mr Angyal SC, who also relied on a Schedule of Sales, a Schedule of outstanding rent and a letter 17 May 2007 making certain assertions with regard to the evidence and relating to costs. 26 The Applicant submitted that there are four matters relevant to whether the interlocutory injunction granted 24 October 2006 should be extended and the terms on which it should be extended. Those four matters are as follows: 1. The Applicant's prospects of success in these substantive proceedings. 2. The prejudice to the Applicant if the relief it seeks by way of interlocutory injunction is not granted. 3. The prejudice to the Respondent if the relief sought is granted. 4. Whether the Applicant's current position is caused by the Respondent. 27 There is in my opinion yet a fifth relevant matter and that is this: 5. The financial circumstances of the Applicant. 28 In relation to the first matter (the Applicant's prospects of success in the substantive proceedings) it would seem that all parties are agreed that the Applicant's case essentially falls into three parts: a. Pre-lease misrepresentation; b. Rent abatement under the alleged addition to Item 10 in the Lease (as to which see [39]-[42] below); c. Disturbance under Retail Leases Act under Section 34. 29 The Applicant submitted that if the Tribunal agreed that the Applicant's case is "extremely weak" (as is asserted by the Respondent) this may be a reason for the Tribunal to not grant the relief it seeks. Alternatively, it was submitted that if the Tribunal agreed that the Applicant had a prima facie case, that was a reason for the Tribunal to grant to the Applicant the relief it sought. I am not entirely sure the latter submission is the correct approach that one should take. It may truly be a matter of semantics but I would have thought that the question to be asked was not whether the Applicant had a prima facie case but rather whether the case for the Applicant was reasonably arguable on the facts as asserted and could not be categorised as "hopeless" or "without merit". Presenting the hurdle as "prima facie" may not do justice to an Applicant who may not have completed (as in this case) all its evidence whereas the balance of convenience may well weigh in favour of an Applicant who has presented what could be categorised as a reasonably arguable case, not hopeless and not without merit. For my part I have adopted that approach in looking at this matter (see [63]-[65] below). 30 Where does one find a "reasonably arguable case" on the material that was put before the Tribunal at the hearing? Firstly, it is plain that the premises about which complaint is primarily made is Shop 417. Although it is true that the Applicant occupies Shops 415 and 416 as well, the evidence shows that the Applicant wished to expand its business into Shop 417. 31 The Applicant is a sitting existing tenant in that in 1998 it signed a lease in respect of Shops 415 and 416. This lease is registered 6724653, was for a term of 5 years commencing 15 January 1999 and terminating 14 January 2004. There is no need for me to refer further to that lease other than to observe that the obligations of the Applicant as lessee were guaranteed by George Joseph Mimis and Elizabeth Anne Weeks (whom I understand to be directors of the Applicant and the latter of whom is the one and the same as Elizabeth Mimis-Weeks). 32 The Respondent operates a shopping centre at Chatswood on a number of various levels. Shops 415 and 416 are situate opposite a food court with no particular line of sight to any entrance/exit but rather are part of a row of shops generally situate opposite the food court. Customers here entering the shopping centre can enter from a number of different entrances, one of which is said to be from "the blue level car park". Customers enter between Shops 436 and 436a (on the left) and Shop 437 on the right and then (at least according to the plans tendered) may move to the right around a circular passageway within the food court area (in which there are a number of other numbered shops), alternatively, can walk to the left and basically straight up towards Shop 417, past the food court and where there is (according to the plan at page 22 of Exhibit "B") a clear line of sight from the entrance from the carpark. The result, as I understood the evidence, is that customers turning left past Shop 436 could look straight up between the other shops and see, in a direct line at the end of the passageway, Shop 417. Ms Mimis-Weeks spoke in her Affidavit as that line of sight being a determining factor when she and her co-director considered expanding their business from Shops 415 and 416 into Shop 417. 33 Her evidence then referred to various discussions that took place between 11 and 20 March 2002 between she and her fellow director and an officer of the Respondent. She deposes that the Respondent's officer stated that the "car park blue level entry… is one of the busiest entries into this shopping centre. When people enter the centre from this entry, they will have a direct and unobstructed line of sight to shop 417." There was then some discussion about rent. It is important to recognise that the directors of the Applicant have had many years of experience as retailers. Ms Mimis-Weeks accepts this in paragraph 14 of her second Affidavit (15 May 2007) when she states that based on her experiences as a retailer she believed that: "there is a positive correlation between the degree of visibility of a shop front in a shopping centre to through traffic, and the number of people who enter and purchase goods from the shop or the rate of conversion of passers by to sales; and there is a positive correlation between the amount of through traffic and the number of people who enter and purchase goods from the shop." She formed the opinion that if the Applicant expanded into Shop 417 she believed that would "increase the visibility of Surf City (the trading name of the shops) to traffic entering Westfield Chatswood from the car park blue level entrance and hence increase the number of people who entered and purchased goods from Surf City; and increase the amount of through traffic passing Surf City and hence increase the number of people who enter and purchase goods from the shop." She also thought that the length of window space of Surf City would increase, thereby increasing the visibility of the business to persons walking through the junction of the corridor running between Grace Bros (which was also on the same floor) and the food court and the corridor running from the car park blue level entrance to Shop 417. 34 At page 24 of Exhibit B there appears a plan, in somewhat enlarged form, showing the location of the shops and the various corridors but, and importantly, it also shows a kiosk marked "BZC" which was apparently a kiosk operated by "B Zone Cosmetics" which was operating at the time of the various discussions with the Respondent's officer but "was dismantled by July 2004 (paragraph 17 Exhibit B)". Ms Mimis-Weeks deposes to the fact that there were various kiosks, generally of a temporary nature, throughout the shopping centre, there were "other temporary or occasional stalls, booths or counters" (sometimes described as "carts") in the shopping centre and, indeed, at or near or in front of (the evidence is not entirely clear) Shop 417. There is no doubt that such temporary or occasional stalls, booths or counters would continue, whether or not the Applicant expanded into Shop 417. Ms Mimis-Weeks deposes to the fact that from looking from Shop 417 down the corridor to the car park and when carts were in place in the corridor she observed "that the carts were close to the lifts and the left side of the corridor as I looked down the corridor ... (and) ... that the carts were narrow in comparison to the width of the corridor. Based on my observations and in my opinion, the carts did not block or interfere with the line of sight from the car park blue zone entrance to Shop 417." 35 Importantly, and by reference to the B Zone Cosmetics kiosk, the Applicant asserts that it "did not interfere with the amount of through traffic passing Shop 417, nor the traffic entering Shop 417" - a number of reasons were advanced. 36 In about July 2002 the Applicant commenced the re-furbishment of Shops 415, 416 and 417. The entrance to the business was moved from the midpoint of the shop front of Shops 415 and 416 to roughly the midpoint of Shop 417. Ms Mimis-Weeks formed the opinion at this new position "would attract a larger number of customers than an entrance in the old position". Approximately $400,000 was spent on the refurbishment, the Respondent contributing $30,000 thereto. 37 At about this time the directors of the Applicant became concerned, having observed "an increase in the number of casual traders operating" in the vicinity of Shop 417, at the junction between the pedestrian walkway from Grace Bros and the passageway from the blue level car park, "that the increase in the number of casual traders … would have a negative impact on the trading of Surf City." The Applicant protested under cover of letter 9 December 2002 about "the issue of the casual tenancies outside and around (the doorway to Shop 417) and visual impairment as a result of kiosk sight lines ..." Concern was expressed in relation to the abundance of casual tenancies "creating difficulties for traffic flow to see and access" the shop front. A complaint was also made about "a large Boost Juice kiosk" which was alleged to have "being erected directly outside" the shop doorway entrance with excessive signage and failure to "maintain sight lines" in breach of the Respondent's "standard fit out guidelines". 38 Importantly, this letter 9 December 2002, at the top of its second page (page 99 of Exhibit B) makes this statement: the Applicant (through its Managing Director Mr George Mimis) suggested a meeting with the Respondent but went on to "note that this not being resolved promptly, as it is well overdue and impairing my optimal trade, that I will have to retrospectively invoke the hand written amendment to Item 10 of the lease." This becomes an important point when one considers the terms of the lease as agitated by the Applicant. 39 The evidence shows that on 8 May 2002 the Respondent sent to the Applicant a number of documents, including the asserted lease. As part of the Respondent's requirements a payment was required for stamp duty, cheque or bank guarantee and one month's rent in advance in $39,187.50 inclusive of GST. The correspondence does not disclose (at least as far as I can see) any objections by the Applicant to the terms of the lease. The Respondent knew that the new store (incorporating all three shops) was due to open in August 2002 (page 56 of Exhibit B) and there is evidence to show that an officer of the Respondent, or its leasing agent, spoke to the Applicant's Managing Director Mr George Mimis advising that he could not open the new store "until leases, bank guarantees, structural certificates etc are received" and that Mr Mimis would have the documentation to the Respondent within the next few days. 40 What happened thereafter is somewhat curious. Apparently a conversation ensued between the two directors of the Applicant when Mr George Mimis said something along the lines: "I am going to add a sentence to the clause concerning the amount of rent payable as follows: "for every day there is a shop front stall and/or visual impediment to the shop front above 1.4 metres high in front of Shops 415 to 417 for part or whole day, the minimum rent payable by the lessee calculated on a daily basis will reduce by 10%" is that OK?" The other director (Ms Elizabeth Mimis-Weeks) agreed. On or about 13 August 2002 the Applicant sent to Westfield the first month's rent in $39,187.50 (although there was some argument about whether that sum was the first month's rent or some other amount on account of rent, I accept for the purposes of this interlocutory application that it was the first month's rent) together with a copy of the lease upon which the handwritten amendment had been made. 41 The Lease itself is set out at pages 57ff of Exhibit B. It is a lease of all three shops. It commences 10 August 2002 and expires 19 August 2008, although the term is stated to be "six (6) years". The important provision (for the purposes of argument) was Item 10 on the front page of the Lease document: this is stated as: "Minimum Rent per annum (Clause 11)" and is in the sum of $427,500 and then, and after that number, appears the handwritten words: "for every day there is a shop front stall and and/or visual impediment to the shop front above 1.4m high in front of Shops 415-417 for part or whole day, the minimum rent payable by the lessee calculated on a daily basis will reduce by 10%". 42 The Respondent/lessee has refused to sign the lease. The Respondent contends that the additional written words were not words as agreed between the parties as an alteration to the lease document as originally submitted. Importantly, there is no assertion in the sworn material before me to the effect that an agreement was reached between the parties to insert those words. Rather, the argument is put in this fashion: the cheque for $39,187.50, being the first month's rent in advance was accepted and banked by the Respondent on or about 21 August 2002 and that, as a consequence, there was an acceptance by the Respondent of the terms of the hand-written alteration. 43 So, it seems to me, there is a threshold question to be decided at some time in the future by the Panel: precisely what are the terms of the lease entered into between the parties - did the lease include the hand-written alteration or is there simply a statutory lease (Section 8), perhaps with the terms of the actual lease document itself but without the hand-written alteration? 44 To cut a long story short, and no doubt the Panel will deal with the matter in greater detail, the Applicant asserts that subsequent to August 2002 the Respondent took steps to install three new kiosks in front of or in the line of sight of Shop 417 looking down the corridor to the entrance from the blue level car park. The Applicant asserts that the height and the area of each of the various kiosks are in excess of the kiosk that was formally there ("BZC"), that queues form and block off the sight and access to Shop 417 (in particular), that the kiosks are erected in breach of the Respondent's own guidelines, that an automatic teller machine was also placed "in front of Shop 417" in May 2005 that itself creates queues "often extending across the doorway to Surf City" such that, with all these asserted impediments, there are "less and less people… walking within 3 metres of the front window of Surf City" (para 53, Exhibit B). 45 In addition, the Applicant asserts that it has been treated less favourably in comparison to other tenants of the shopping centre. There were further communications with the Respondent and it is asserted that the then centre manager (paragraph 68) admitted that he knew "these kiosks are a problem but there is nothing I can do about them it is outside my control". There was then some discussion later in July 2005 relating to a competitor. Ms Mimis-Weeks says that she told the Respondent's representative "Surf City needs to downsize. Trading from Shops 415 to 417 has not been profitable due to the loss of my sight lines due to the Boost Juice kiosk and casual tenants placed opposite Surf City all year round". There was then continuing discussion between the parties relating to proposed downsizing, an assertion by the Respondent that the Applicant "would be silly to downsize" because the centre had "a great future", there was "a council development linking Westfield to Chatswood Chase and we are spending money upgrading the centre ... (the) plan has been approved. The development will be completed by mid 2006. …. we are also about to redevelop the car park. We are spending millions of dollars. …. You would be mad to downsize now when all this is happening over the next six months. You should wait until the refurbishment is down and see if trade improves. You should benefit directly from the improved food court." An application to the Respondent for interim "rent relief' on 21 November 2005 and again 10 April 2006 was refused. 46 There is no need for me to trawl through the balance of the sworn evidence. Suffice it to say that in my opinion the material thus far in evidence by the Applicant is sufficient to disclose a reasonably arguable case. It cannot be said that the case is hopeless or without merit. There may well be parts of it that are somewhat doubtful or may be, upon a further more careful analysis and after hearing the whole case, including the evidence of the Respondent, be not supportive of the various causes of action pleaded. That is all a matter for the Panel. I am not prepared to conclude, from what I have seen thus far, that the Applicant's case is "extremely weak" but rather that the Applicant has an arguable case that is not hopeless not without merit. However, that is only one part of the equation. Prejudice to Applicant 47 The Applicant is the lessee of the three shops in question. It was the lessee of two of those three shops for many years. The Applicant is experienced in retailing. Shops 415 and 416 adjoin Shop 417 such that it is difficult for me to conclude at this point that the Applicant relied solely upon the asserted representations of the Respondent. After all, the Applicant had been in occupation of Shops 51 and 416 since 1998 and would be fully aware (one would think) of the surrounding circumstances, pedestrian traffic flows and so on. 48 The Applicant asserts that it would be prejudiced. It says that it has paid the Respondent $2,792,971 in rent since August 2002. As at 30 June 2006 the Applicant was up to date in the payment of rent and outgoings. It asserts that between July and December 2006 its gross sales have been about $667,000.00, stock purchases about $483,654.00, has paid other outgoings relating to the operation of the business and had paid the Respondent about $211,000.00 in rent. Consequently, the Applicant asserts that the outgoings of its business "were at least $80,000.00 greater than its income". Ms Mimis-Weeks as a director has stated that in that period she "drew down from (her) overdraft to meet the shortfall". She says that the position from 1 January 2007 to present have deteriorated in that gross sales have been about $266,000, stock purchases between $120,000.00 and $150,000.00, the Applicant has paid other business outgoings and $206,000.00 to the Respondent in rent. She asserts that the Applicant "is continuing to trade at a significant loss. In this period I have continued to draw down from the overdraft to meet the shortfall." She then asserts (paragraph 20 of Exhibit A) that there is "no longer capacity for me to draw down from the overdraft to meet the full payment" of outstanding rent such that on 1 May 2007 the Applicant paid the Respondent $15,000.00 and is "currently exploring financing options with lending institutions." 49 Importantly, at paragraph 21 of Exhibit A she states that the "payment of rent by the applicant to the respondent is the greatest expense of the applicant. But for the payment of rent (about which there is a dispute between the applicant and respondent), the applicant has at all times been able to pay its expenses as and when they fall due." 50 Notwithstanding all this the Applicant seeks to remain in Shops 415-417. The Applicant then provides certain reasons for this desire and has received "an offer from a prospective purchaser to purchase the business known as Surf City. The prospective purchaser is willing to pay the Applicant to purchase the business. A significant asset of the business is the exclusive right to sell three brands in or near Westfield Chatswood." Apparently, the "offer from the prospective purchaser is subject to the respondent agreeing to give the prospective purchaser a new lease of shops 415 to 417. So far the respondent has refused to give the prospective purchaser a new lease. If the applicant is locked out of shops 415 to 417 in the near future" there will be a number of consequences, namely the loss of the asset, the opportunity to sell the business, the Respondent obtaining "the asset explained above for free", the Applicant being "no longer able to trade" and to the effect that "the applicant may no longer be able to continue these proceedings against the respondent." 51 The Respondent has prepared a Schedule of Sales based upon material that has been thus far provided, including material that was not led before me on this interlocutory application, and its Schedule (Exhibit 1) demonstrates that the sales of the Applicant have not in fact fallen as asserted. It is difficult at this level and at this time to draw any useful conclusion from what appears to be, at least at first blush, a dispute as to significant facts. In these circumstances I am prepared to conclude that the Applicant may well be prejudiced, at least to the degree as pleaded/asserted, and that is a factor that I should bear in mind in considering whether or not to continue the injunction. Prejudice to Respondent 52 The Applicant concedes that if it loses the substantive proceedings the Respondent is unlikely to recover overdue rent. The Applicant asserts that somehow I should bear in mind the quantum of rent actually paid since August 2002. I confess I am unable to understand how that assertion can have any bearing on the continuation of an injunction in circumstances where there are, unarguably, considerable arrears of rent. 53 The Applicant contends that the rent payable per square metre is significantly greater for its store than for other stores in the shopping centre, that the Respondent has "profited well from the Applicant over the last few years" and that the Respondent "has granted other tenants in its shopping centre rent relief, but not the Applicant". 54 What the Applicant does not address in its written submissions is the state of arrears. Probably this is not necessary because what the Applicant asserts is that because of the actions of the Respondent the Applicant is entitled to recover from the Respondent an amount of money that which be equal to or in excess of the arrears claimed by the Respondent. Causation of Applicant's current position 55 The Applicant contends that but for the March 2002 pre-lease misrepresentation the Applicant would not be in its current position; and but for the Respondent's Section 34 breaches since October 2002 the Applicant would similarly not be in its current position. 56 Because I have concluded that the case for the Applicant, at least as thus far presented, is an arguable case an ought to go forward, there is no need for me to refer further to this assertion. If the Applicant is successful then clearly that will make a considerable difference to the nett amount of money due by the Applicant to the Respondent. Financial Circumstances of the Applicant 57 There are a number of significant points which were raised during the course of argument. It is convenient to set these out seriatim: 1. The Applicant is a $2.00 company. 2. The arrears of rent are somewhere between $160,000.00 (as asserted by the Applicant) and $163,000.00 (as asserted by the Respondent). 3. It appears clear that, absent relief, the Applicant is insolvent and unable to pay its debts as and when they fall due. 4. The asserted Lease is not signed by the parties. 5. The asserted Lease has been signed only by Mr George Mimis, a director, not signed by Ms Elizabeth Mimis-Weeks as a director or company officer, signed by Mr George Mimis as guarantor, and not signed by Ms Mimis-Weeks as guarantor. The significance of that observation is that all of the primary evidence thus far led on behalf of the Applicant is that of Ms Mimis-Weeks who has not signed the asserted lease in any capacity. That only goes to underline the $2 nature of this company. And it is in stark contrast to the fact that Ms Mimis-Weeks in fact signed the original lease commencing 15 January 1999 as guarantor. Other Observations 58 The Respondent put to me that the fact that some of these conversations were between Ms Mimis-Weeks and Mr George Mimis and other conversations were in the presence of George Mimis, and Mr George Mimis has not been called and has not given any evidence then I should invoke the "rule" in Jones v. Dunkeld (1959) 101 CLR 298. This asserted "rule" (and the "rule" in Commercial Union Assurance Co of Australia Ltd v. Ferrcom Pty Limited (1991) 22 NSWLR 389 at 418-419), are not strictly speaking rules of evidence but are rather permissive in that the Court is invited to draw the inference that the witness would not have given evidence that would have assisted that party's case. The importance of the two "rules" is this: the Court is not required to or obligated to draw that inference but rather the Court may draw the inference. Thus, in the circumstances of this case, any such inference is a matter for the Panel. Principles 59 The relevant power is to be found in Retail Leases Act Section 72(4). This provides that 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." 60 Interlocutory orders by way of injunction are often made in this Division. Generally speaking, they arise out of an action taken by a lessor to terminate or evict a lessee/tenant. The Tribunal will often, but no always, act positively to retain the status quo. The terms of the injunctions/stay are at large but are generally made subject to rent under the lease being paid and kept up to date and are limited in time. A fixed time may be imposed, alternatively a grant is made "until further order" but the matter is brought back for further consideration at a specified future time, with liberty to both parties to apply. In either case, that gives the respondent to the application an opportunity to respond, it gives the applicant an opportunity to file additional evidentiary material (injunctions often being granted as a matter of extreme urgency and on initially very little evidence), and it gives both parties an opportunity to negotiate with a view to resolving the issues. 61 The general principles relating to the making of interim orders under Section 72(4) are initially to be found in the decision of His Honour O'Connor DCJ in Townsend v. Chief Executive, State Rail Authority [1999] NSWADT 56. His Honour made these various observations: firstly, at [12] that "the power (to make an interim order) should not be interpreted strictly by reference to the well-known criteria governing the grant of interim relief by way of interlocutory injunctions"; at [13] he described this Tribunal as "a statutory Tribunal with a range of statutory remedies at its disposal, designed to ensure fairness according to law in dealings between lessor and lessees"; at [14] he observed that there "are a wide range of potential circumstances that may at times require intervention by way of interim orders" and he expressed the view that he would be reluctant "to encourage a view that the provision should be strictly interpreted by reference to what might be seen as analogous areas of the law"; at [17] he observed that the making of an interim order was an exercise of discretion; at [21], having enumerated various factors which he thought were not determinative he went on to observe that he needed "to have regard to general considerations as to the balance of convenience and the strength of the applicants' case as currently presented, even though I do not regard myself as bound in any strict way by the list of considerations that have been developed in other contexts"; and finally at [22] he held that on the basis of the facts in that case as put forward by the applicants they were not sufficient to permit the making of an interim order but observed that should the applicants be successful in relation to their principal application they would be more than likely to seek monetary compensation for the financial consequences of the actions of the respondent and he made this observation : "The considerations advanced before me today are not sufficient …. to justify the Tribunal making an order which has the effect of permitting (the applicants) to remain in possession of the premises pending the hearing of that application." 62 His Honour had the occasion to re-visit the making of urgent interim orders in Nam v Commonwealth Funds Management Limited [2002] NSWADT 80. Here at [14] His Honour observed that the Retail Leases Act "does not confer general equitable jurisdiction on the Tribunal. There is no power to issue an injunction, but the Act does confer similar statutory powers." His Honour then looked at Section 72(1) to determine whether, in the actual Application itself, there was power residing in the Tribunal and in that case found it in Section 72(1)(c)(iv). I pause here to observe that no submission was made to me that the Tribunal did not have power to make the orders sought by the Applicant such that there is no requirement on me to discover from the Act a power to make a final order. Obviously, the Tribunal should not make an interim order if in fact it has no jurisdiction to make a final order. 63 At [43] His Honour reviewed the general principles applicable to the grant of interim relief, referring in particular to Beecham Group Ltd v Bristol Laboratories Pty ltd (1968) 118 CLR 618. I will not set out here the passage relied upon His Honour, such being mere duplication, but in my view that passage supports the general observation that I have made to the effect that one does not need to present a prima facie case but rather a reasonably arguable case. Although the High Court said that in this type of case the plaintiff needs to make out a prima facie case "in the sense that if the evidence remains as it is there is a probability that at the trial of the action the plaintiff will be held entitled to relief", later in the passage the Court referred to ""some" probability of success is enough" and the need to show that the Applicant "has shown a probability of success". 64 Indeed, that is the general approach that is adopted in the analogous type of application when reviewing the issue of whether or not a pleading should be struck out - in Tapoohi v. Lewenberg (2)[2003] VSC 410 Habersberger J at [86] stated that he had "reached the conclusion that it is not beyond argument that some at least of the breaches of the contractual and tortious duties might be made out … (and he emphasised) that it is not for (the Court) to conclude that any of these things occurred in the present case and I do not do so. It is sufficient that I conclude, as I do, that on the evidence before me such a contention is not plainly hopeless." As if to emphasise the point His Honour at [87] observed that a "claim of the kind presented raises considerable difficulties of causation … (which were) illustrated by the decision of this Missouri Court of Appeals in Lange v. Marshall (but nevertheless His Honour thought the matter should proceed to a hearing because) it is only when all the facts are known and examined that this question can be determined (and His Honour observed that he) would certainly not conclude, as things stand, that it is so plainly hopeless that the (plaintiff) should be denied a trial of this issue". His Honour (at [88]) made a similar observation when addressing the issue of the claimed damages. 65 In Nam at [60] O'Connor DCJ concluded that "in relation to the question of whether the applicant has an arguable case that the lessors have caused disruptions through their works, the Tribunal is satisfied that there is an arguable case for relief in relation to the disruption that has occurred so far." 66 The second limb identified by the High Court in Beecham was whether a more suitable other form of remedy was available. At [70] O'Connor DCJ made this observation on the facts of the matter then before him in Nam: "the kind of complaint made in this case is not one that can, the Tribunal considers, be adequately met by an award of damages if contravention is shown. The parties are in a continuing relationship. One party complains that the other is continuously breaching the terms of that relationship. The tenant is entitled to quiet enjoyment of the premises, and to be able to undertake trade in circumstances that are attractive and convenient to customers. At tenant is clearly better served by orders that restrained disruptive activities on the part of the lessor, rather than having to bear the financial consequences in the short term, and deal with them by a money order. The Tribunal is satisfied that damages are not an adequate alternative remedy in a case of this kind." 67 His Honour went on to observe, at [81], that the Retail Leases Act 1994 was "remedial legislation. Its primary focus is the relationship between lessors and lessees in retail shopping centres." At [82] His Honour referred to the 1998 amendments introducing into the Act "provisions under which lessees may sue lessors for unconscionable conduct, reflecting the Parliament's concern over the conduct of some lessors in their management of shopping centres… the 1998 amendments also extended the range of orders that the Tribunal could make in relation to retail tenancy claims, and introduced the power to grant interim relief." At [87] His Honour referred to an observation of Lord Denning NR in Allen v. Jambo Holdings Ltd [1980] 2 All ER 502 where at 503 His Lordship stated, in relation to the grant of a Mareva injunction, that "one has to look at these matters broadly. As a matter of convenience, balancing one side against the other ..." And, at [92] O'Connor DCJ observed that retail leases law "also has a public policy set in, though no doubt not seen by many as being as significant as the place occupied by environmental protection laws. The relationship between retail shop tenants and lessors is no longer a matter of private contract. The Act introduces binding, minimum standards. The Tribunal is not prepared to endorse as a pre condition to the grant of interim statutory relief under the Act the giving of an undertaking as to damages." 68 It is plain from Nam that the Tribunal, when considering the grant of some form of interim order, should give close regard to the economic impact of the orders that are sought and the orders (if any) that the Tribunal proposes to grant - see Nam v Commonwealth Funds Management Limited (No2) [2002] NSWADT 120 at 56]. 69 Finally, and in general support of the proposition that the Retail Leases Act 1994 is, at least to a large extent, "remedial legislation", I draw attention to the observations of the High Court in Commissioner of Taxation v. Murry ([1998] 193 CLR 605 at 632) where that Court described S.160ZZR (Income Tax Assessment Act 1936) as "a relieving provision … designed … to lighten the burden cast upon the taxpayer … (such that provisions) of this kind, according relief to the taxpayer, have conventionally been treated as, to some extent, beneficial (and that) they "should not be narrowly construed and should be interpreted to promote the purpose and object underlying the relevant Act"". Interim Order Conclusions 70 Putting the above principles into effect as best I can, it seems to me that the Applicants have demonstrated a reasonably arguable case, even a prima facie case, that may entitle them ultimately to damages or orders that would, by way of contra, negative in whole or a substantial part the claim by the Respondent for unpaid rent. Whether or not the Applicant succeeds is a matter to be determined at a later date by the Panel. However, on the balance of convenience, but subject to more stringent terms, the Applicant ought to be permitted to remain in occupation of the premises Shops 415,416 and 417. 71 There are a number of countervailing primary concerns that have weighed upon me. Firstly, there is stark fact that the Applicant is in arrears of rent in at least $160,000. Secondly, the Applicant is a $2.00 company which, on one view, is probably insolvent. Thirdly, there is a very, very strong argument to the effect that the hand-written amendments to the Lease were made by Mr George Mimis, with the consent of his fellow director Ms Mimis-Weeks, unilaterally and do not reflect an agreement reached between the Applicant and the Respondent; but rather support an argument that the Applicant was prepared to make an allowance for the location of the kiosks in occupying Shop 417 and seeking to extend its tenancy and that allowance is the measure of damages that is truly claimed by the Applicant. I am informed by counsel for the Applicant that if that approach was adopted then the amount that could be claimed under that head would equal or exceed the arrears of rent. Fourthly, the lease asserted by the Applicant has, not only not only not been signed by the Respondent and not dated but has also not been signed, in any capacity, by Ms Mimis-Weeks, who is the person who has given the primary evidence in this matter thus far and is not a guarantor. Thus, it seems to me, that Ms Mimis-Weeks, although having the "carriage" of the proceedings, has no particular financial interest in the consequences as a guarantor but rather as a director/company officer of the Applicant who has, on her evidence, entered into personal debt in order to support the Applicant company. And finally, these proceedings commenced on 12 October 2006. They have, to all intents and purposes and until recently, not progressed. Hearing dates have been vacated. A costs order has been made against the Applicant. The Applicant has filed fresh and detailed evidence and has yet to file and serve its expert report. However, the Applicant has consulted new lawyers, engaged fresh counsel and seems to be keen to get the matter on for hearing as quickly as is possible. 72 Weighing all these matters up in the balance in my opinion the Applicant should be permitted to remain in occupation but subject to appropriate security being offered, and accepted by this Tribunal, against the continuing liability to pay rent and the clear liability to pay the costs thrown away. Because I do not know what form of security can be offered in my view the Applicant should put forward to the Respondent a form of security consistent with this judgment and then bring the matter back to this Tribunal for the making of further orders on the next directions date. If the Applicant cannot offer security in a form that is reasonably acceptable then in my view (expressed at this time without the benefit of argument) the injunction initially granted 24 October 2006 should be vacated because, although it is true that the Applicant has presented a reasonably arguable case the arrears in rent continue to mount at a somewhat frightening pace (in the absence of payment) and by the time the matter is heard and determined there may well be severe prejudice to the Respondent because of that factor. The Applicant, when putting together a submission on security ought, in my view, factor in the continuing contractual obligation to pay rent in the manner specified below. 73 It is also my opinion that the Applicant should continue to pay rent in an amount that is reasonable having regard to the granting of appropriate security. In my view it is not in the interest of either party that the Applicant should pay no rent at all (I recognise there is a live issue relating to sales and whether the Applicant's sales from the premises have remained at a steady level or declined) but it is the Applicant that has come to this Tribunal for relief and it is the Applicant which has an obligation, particularly an obligation to the Respondent, to move the matter forward with reasonable expedition (which has clearly not happened thus far) and thereby lies the rub in that the delay by the Applicant in getting its house in order, putting on its appropriate evidence, has exacerbated the rental arrears and, on the Applicant's own case, is creating an ongoing negative situation which could have been avoided had the Applicant promptly and efficiently presented its case and the fixed hearing dates had not been vacated. Costs 74 It will be remembered that these proceedings were actually set down for hearing by Judicial Member Fox on 8 March 2007, the hearing dates being for 4 days commencing 16 April 2007. Those hearing dates were vacated by Judicial Member Higgins (in the circumstances I have set out above) on 12 April 2007 when she ordered that the Applicant pay the Respondent's costs thrown away in respect to the adjourned application. She also noted that the Respondent reserved its right to seek costs thrown away as a result of the new evidence that is filed. Of course, additional material has been subsequently filed by the Applicant but it seems to me that any costs "thrown away as a result of the new evidence that is filed" is a matter for final determination by the Panel. 75 The issue now before me is whether the costs as so ordered 12 April 2007 should be assessed and paid forthwith. The Respondent seeks an order to that effect. The Respondent relies upon the letter from its solicitors to those of the Applicant dated 17 May 2007 (Exhibit "3"). Much of that letter deals with the additional evidence and the necessity for the Respondent to obtain further proofs of evidence, with potential new witnesses, in order to meet the new evidence filed by the Applicant. However, more importantly, the letter refers to the fact that the Applicant is a $2.00 company and is contending that it is unable to pay the rent under its lease as and when it falls due; and the Respondent had briefed senior counsel and he had put aside the days fixed for the hearing and that there were cancellation fees involved and that the Respondent "has a legitimate concern that (the Applicant) will not be in the position meet the costs order that had been made against it at the conclusion of these proceedings." The Respondent further contended "that it is inherently unfair for it have to now incur further legal costs responding to (the Applicant's) second set of evidence when its costs thrown away in relation to the first set of evidence relied upon by the (Applicant) have not been paid." The letter, and by its senior counsel at the hearing, indicated that the Respondent would accept appropriate security for those costs but asserted that the Applicant "should not be permitted to continue prosecuting the matter until such time as the costs have been paid." 76 Counsel for the Applicant resisted this application and made the following points: firstly, he relied upon Part 42 Rule 42.21 of the Uniform Civil Procedural Rules 2005. I observe that Rule 42.21(1)(d) permits the Court to order security for costs where "there is reason to believe that a plaintiff, being a corporation, will be unable to pay the costs of the defendant if ordered to do so" I also note in that in the commentary these statements are made: [42.21.5] "the fundamental purpose of the power to order security for costs is to secure justice between the parties - principally by ensuring that unsuccessful proceedings do not occasion injustice to defendants. This rule confers a wide discretion that is to be exercised having regard to all the circumstances of the particular case. The discretion is not restricted by any special rules and should not be circumscribed by an inflexible approach to burden of proof issues. Accordingly, there is no rule that an order for security ought be made merely because the grounds set out in rule 42.21(1) have been established". 77 At [42.21.10] it is observed that the "court's discretion to order security for costs both requires and permits account to be made of a wide range of considerations." There are a number of factors that ought to be considered, including (but not limited to) "whether the plaintiff's claim is made in good faith and appears to be reasonably arguable (I note that in this case "it is not appropriate to attempt a more detailed assessment of the prospects of success"); the "status of the defendant"; "whether the plaintiff's lack of funds has been caused or contributed to buy the conduct of the defendant"; "whether the making of the order would unduly stultify the plaintiff's ability to pursue the proceedings"; and "the likelihood of a costs order being made at the conclusion of the proceedings and the public interest nature of the litigation". 78 At [42.21.15] it is stated that the Court "does not set out to provide a complete indemnity to the defendant in respect of their costs (but rather) the Court's power is to require "sufficient security" and the Court must also have regard to the effect of the order upon the plaintiff's ability to continue the litigation." I note, and it may be messy, that there seems to be authority for the proposition that the parties may be asked to agree on a staged timetable for the provision of security and that if agreement cannot be reached on the quantum of security "the Court can make an order for reference to a referee". 79 Nextly, counsel for the Applicant relied on Horrobin v. ANZ Banking Group Limited [BC9702258] where Priestly JA emphasised at [9] "the need for cases to be considered by reference to their own particular facts" and noted that there was "a tendency for costs orders to be made payable forthwith and without waiting for the conclusion of further proceedings when the proceedings in respect of which the costs orders have been made are regarded as sufficiently self contained and detached or detachable from proceedings yet to be heard, whether between the same or associated parties, as to make it seem just for an actual payment to be made in the meantime." In that case His Honour ordered that costs previously ordered "shall be payable forthwith" on the basis of the facts peculiar to that case, namely if would be at least a year before the proceedings came to trial, substantial costs had already been incurred, the "result and costs orders flowing from it will not be effected by the proceedings yet to be decided" and otherwise as set out at [9]. 80 Reliance was also placed upon Fiduciary Ltd v Morningstar Research Pty Limited [2002] NSWSC432 - this was a case where the plaintiff sought injunctions restraining the defendant from issuing shares to Morningstar Inc and in relation to the dismissal of the second plaintiff as managing director. The plaintiffs' application was dismissed with costs. The defendants applied for an order that the costs of the proceedings be payable forthwith. His Honour Barrett J made detailed reference to Part 52A, rule 9 of the Supreme Court Rules 1990. His Honour reviewed, to some extent, the history of the general principle that the award of costs should await the conclusion of the proceedings, then considered the factors which have "caused Courts to depart from the normal rule, referred to Horrobin, and then identified recognisable categories of cases where costs orders have been made "to be assessed and paid forthwith". One category was "where the application or aspect in respect of which the particular cost order is made before conclusion of the proceedings represents the determination of the separately identifiable matter and may be viewed as the completion of a discrete aspect." Another was the identification of "some unreasonable conduct on the part of the party against whom costs had been ordered". A third identifiable factor was "that "there was much to come in these proceedings" and "one can see a fairly long time before the proceedings are disposed of" (in other words, where the final determination of the proceedings is far away). His Honour in this case made an order to the effect that the costs be payable forthwith, on the basis firstly, costs were incurred in obtaining evidence which should not have been needed; secondly, a "mountain of paper" was served which was not relied upon by the plaintiffs at the hearing; thirdly, considerable delay by the plaintiff in complying with directions; such that "these timing factors indicate …. that the interlocutory hearing may be regarded as a separate and complete phase of the proceedings." The key to His Honours ultimate order was that the order was "in the interest of justice" (at page 6). 81 In my view the totality of the conduct of the Applicant, as I have endeavoured to set out above, resulting in the ultimate vacation of the hearing dates, and the apparent impecuniosity of the Applicant, lead me to the view that the costs as ordered by Judicial Member Higgins 12 April 2007 should be assessed and payable forthwith, but subject to (as was conceded by senior counsel for the Respondent) any acceptable proposal by the Applicant providing appropriate security for the payment of those assessed costs. 82 Costs are to be assessed on the usual reasonable basis. It was submitted in Exhibit 3 that senior counsel for the Respondent "had been retained on the basis of charging cancellation fees in the event the matter did not proceed. In the result (he) did not receive any briefs for the days on which this matter had previously been set down for hearing and has charged (the Respondent) for those dates." Whether cancellation fees are recoverable is a matter for the assessor. Clearly such cancellation fees must have been in the mind of the Applicant and/or those advising it at the time the Applicant applied for vacation of the hearing dates. It may well be that a question of mitigation is involved, but that is a matter for the assessor. Security 83 There are two aspects of the security in this case: firstly, the aspect of the security relating to the arrears of rent and continuing contractual liability to pay rent as a result of the continuation of the injunction; secondly, the security for the payment of assessed costs. There is insufficient material before me in order to form any opinion relating to what sort of security orders ought to be made. Security can be provided by the Applicant, by the Applicant with another or others either jointly or severally, or indeed by somebody else, either a company officer or somebody totally unrelated, or by a financing body. These are matters to be considered by the Applicant and those advising it and should be the subject of discussion between the lawyers for both parties with a view to (hopefully) coming up with a reasonable proposition that can be adopted by the Tribunal. Absent such agreement it will be necessary for the Tribunal, having heard the parties, to make appropriate orders for security consistent with the terms of this judgment. 84 The security should take into account the fact that the Applicant will be required to pay an amount of money on account of rent. In addition I propose to make orders that will bring this matter on for hearing as quickly as is reasonably possible - after all, it is the Applicant's application and, although it is the fault of the Applicant that the hearing dates were vacated and the matter has not been heard promptly, having read the material filed thus far this is clearly a case that requires urgent attention by the Applicant and its legal advisors so that the Applicant's case can be agitated and, if successful, the Applicant can be relieved of the whole or part of the rental arrears. That is not to say that the application will be successful but rather that it is in the Applicant's interests to bring this matter on for hearing as quickly as is reasonably possible. The orders that I have fashioned and set out below will assist (hopefully) in the relatively speedy resolution of the issues. 85 I should observe that no party submitted that the Tribunal had no power to order security. Indeed it was the Respondent's clear submission that security for costs ought to be contemplated by the Tribunal. For my part I am comfortable in relying on Retail Leases Act s72(2), (3) and (4). Final Observation 86 On one view it could be said that the Applicant is the author of its own misfortune. If the hearing dates had not been vacated at the request of the Applicant (see [22] above) then the proceedings would have been heard before the Panel 16 April 2007, the Panel would have no doubt continued the previous injunctive orders until its decision and there would have been no need for the current application now before me. 87 The fact that the matter continues, with additional fresh evidence to be filed by both parties, evidence thus far incomplete, yet the Applicant seeks to continue in occupation and to continue to trade therefrom, and new hearing dates have not been sought, results in a balancing act to be preformed which will do justice, as far as one can in the interim, between the parties, and serve to protect the competing interests but recognising that the Applicant has put itself in the current position and must perform, at least to a reasonable extent, its current contractual obligations bearing in mind the elongation of the proceedings. Orders 1. The Respondent is restrained from taking any steps to evict the Applicant from the premises Shops 415, 416 and 417 Westfield Shoppingtown Chatswood, pending further order. 2. The grant of relief in Order 1 is on the following terms: a) Applicant pay to the Respondent on account of rent $25,000.00 per month, the first payment to be made for the month commencing 1 June 2007, such payment to be made within seven days of the date of this decision, thereafter monthly for the subsequent rent periods commencing 1 July 2007, such subsequent payments to be made within 7 days of the first day each month. b) Applicant to provide security in the sum of $28,049.88, being the balance of regular monthly rental payments, from and including the payment due 1 June 2007 until the date of any final decision on the Application. c) Such security to be the subject of agreement between the parties and, absent agreement, to be determined by the Tribunal. 3. Proceedings listed for further directions at 9 am on 26 July 2007 for the purposes of making any consent orders with regard to the granting of such security; alternatively, for fixing a date for hearing on the type of security that should be ordered to be provided by the Applicant. 4. Costs order made 12 April 2007 be varied so as to read: "The Applicant pay the Respondent's costs thrown away in respect of the adjournment application and in respect to the vacation of the hearing dates, such costs to be assessed and payable forthwith." 5. Should the Applicant seek a variation of order 4 above by deleting the words "and payable forthwith" by words in or to the effect "such costs to be satisfied by the Applicant providing security", the Applicant is granted leave to re-list the proceedings for that purpose at a convenient time after assessment of the Respondent's costs. 6. The Application be listed for further Directions on 12 July 2007 at 9.30am. 7. Leave granted to the Applicant to amend its Application as it maybe advised, any such Amended Application to be filed and served no later than 2 July 2007. 8. The applicant to file and serve all documents and affidavits upon which it seeks to rely no later than 9 July 2007. 9. Liberty to apply.

Spuds Surf Chatswood Pty Ltd v P T Limited

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Judgment (8 paragraphs)

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