Westfield Management Limited & Ors v Direct Factory Outlets Homebush Pty Limited & Ors - [2004] NSWLEC 327 - NSWLEC 2004 case summary — Zoe

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Westfield Management Limited & Ors v Direct Factory Outlets Homebush Pty Limited & Ors

[2004] NSWLEC 327

Land and Environment Court (NSW)|2004-06-24|Before: Pain J, Mr J

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At a glance

Source facts

Court

Land and Environment Court (NSW)

Decision date

2004-06-24

Before

Pain J, Mr J

Source

Original judgment source is linked above.

Judgment (44 paragraphs)

[1]

CITATION : Westfield Management Limited & Ors v Direct Factory Outlets Homebush Pty Limited & Ors [2004] NSWLEC 327 APPLICANTS Westfield Management Limited GPT Management Limited Centro Properties Limited Stockland Trust Management Limited PARTIES : FIRST RESPONDENT Direct Factory Outlets Homebush Pty Limited SECOND RESPONDENT Sanity Music Stores Pty Limited FOURTH RESPONDENT Colorado Group Limited t/as Mathers Shoes FILE NUMBER(S) : 40871 of 2002 CORAM: Pain J KEY ISSUES: Practice and Procedure :- Application for summary dismissal/strike out of proceedings - Whether Applicants' case as pleaded discloses a cause of action against the Respondents Environmental Planning and Assessment Act 1979 LEGISLATION CITED: Land and Environment Court Rules, Pt 9 r 4(1), Pt 15 r 3(1), Pt 15 r 5(1) Supreme Court Rules, Pt 31 r 2 Fastbuck$ v Dudley Pastoral Co Pty Ltd and Ors (2003) NSWCA 126; CASES CITED: General Steel Industries Inc v Commissioner of Railways (NSW) & Ors (1964) 112 CLR 125; Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia [No 3] (1998) 195 CLR; Wilkie v Blacktown City Council (2992) 121 LGERA 444 17/06/2004 18/06/2004 DATES OF HEARING: 21/06/2004 22/06/2004 23/06/2004 24/06/2004 DATE OF JUDGMENT: 06/25/2004

[2]

APPLICANTS Mr M G Craig QC with Mr J B Maston and Mr M Seymour SOLICITOR Speed and Stracey

[16]

In support of ground 1, no reasonable cause of action disclosed, the First Respondent made the following submissions: (a) The Applicants have failed to disclose any reasonable cause of action, as disclosed in either their pleadings or their oral submissions, for alleging a breach by the First Respondent, as lessor, of condition 11 of the development consent. (b) The Applicants have not pleaded the construction of condition 11 which they now seek to argue. (c) The construction of condition 11 which the Applicants put forward in their oral submissions is untenable. Condition 11 relates to the premises as a whole and not to each of the leased premises within the centre. Such a construction is not reasonably arguable in the face of the wording of condition 11, which plainly relates to the whole of the premises rather than any subset of the premises. Further, the construction put forward by the Applicants does not disclose any test which could be applied for the purpose of determining whether condition 11 has been breached. (d) In light of the decision of the Court of Appeal in Wilkie v Blacktown City Council (2992) 121 LGERA 444, the Points of Claim disclose no case of breach against the First Respondent as lessor by reason of the actions taken by persons leasing premises from it. (e) In relation to ground 3, the declaration sought by the Applicants at declaration 2 of Annexure A to its Pt 34 document relate to the whole of the premises and not just to such parts of them as are occupied by the Second and Fourth Respondents. Given this, the relief sought is either untenable or would first require the joinder of all the tenants. The Court cannot or would not make such a declaration without having all the affected tenants before the Court. (f) Further, the order sought by the Applicant at order 3 of Annexure A to its Pt 3 r 2 document would prevent the First Respondent from managing the whole of its premises unless it imposed on all tenants a requirement to use the centre in accordance with condition 11 as it is construed by the Applicants. The Court cannot or would not make such an order without having all the affected tenants before the Court.

[18]

In support of the first ground, no reasonable cause of action, raised by the Second Respondent, the Second Respondent made the following submissions: (a) The Applicants' pleadings as against the Second Respondent assert, in par 9, 10 and 11 of its Points of Claim, that the Second Respondent "is using and has at all material times been using the premises without development consent". The pleadings fail to identify how it is that the Second Respondent, who only occupies a small portion of the premises, is using the premises as a whole. This contention that the Second Respondent is using the whole of the premises in breach of the consent is repeated in the revised forms of relief attached as Annexure A to the Pt 3 r 2 document which the Applicants handed up to the Court and which the Applicants have indicated is intended to replace to relief sought in its Application. (b) Even if the Applicants amended the pleadings to indicate how it was that the Second Respondent's use of the part of the premises it leases constitutes use of the premises as a whole, the Applicants' case could never succeed in this regard as the use of the two tenancies within the premises could never establish the primary function of the use of the centre as a whole for the purposes of condition 11 of the development consent. (c) The Applicants suggested in oral submissions that "namely as a shop" should be read as being included in par 7 and 9 of the Points of Claim as against the Second Respondent. Even if the Applicants sought to amend the pleadings in this manner it still does not reveal and, given that shops are both permissible and impermissible under the relevant Ordinance, the pleadings are required to reveal, how it is pleaded that the premises occupied by the Second Respondent are a prohibited shop. While it emerged during the Applicants' oral submissions that it relies on what it says is a prohibition on "a shop" contained in sentence 2 of condition 11 and that it argues that the word "shop" in condition 11 should be interpreted as being defined as it is in the Ordinance, this is not pleaded and the Applicants have not sought to amend their pleadings in this manner. Accordingly, the pleading does not provide the link between the sales which the Applicants claim have been made by the Second Respondent and the necessary material characteristics which the Applicants say an impermissible shop would need to have, in order for there to be a breach by the Second Respondent of condition 11. (d) While the Applicants argue that the Second Respondent was put on notice by the particulars it received in response to a request made for same by the Second Respondent as to the manner in which the Applicants argue cl 11 has been breached by the Second Respondent, the particulars provided by the Applicants did not link the shop point, in terms of the definition contained in the Ordinance, with the alleged breach of condition 11 contained in par 57 of the Points of Claim.

[21]

(ii) Further the Fourth Respondent argues that the pleadings are embarrassing in that the pleadings do not make what the Fourth Respondent argues are two essential averments: (a) It does not aver, articulate or quantify the conduct alleged to constitute the impermissible function; and (b) On its face it asserts that each and every sale not at a discount or not of surplus stock etc would give rise to a breach. Yet that has been eschewed by the Applicant in its opening. (iii) Further, the Fourth Respondent argues that the Applicants' opening went outside the Applicants' pleadings by indicating that the Applicants would also be relying on various other indicia other than the mere sale of non discounted goods not of a description included in sentence 1 of condition 11 to establish that the Respondents have breached condition 11. (iv) The defects in the Applicants' pleadings cannot be remedied by amendment as: (a) the Applicants have only chosen two out of around 70 tenancies in the premises on which it relies to establish that the dominant purpose of the premises is not that required by condition 11 of the consent; and (b) the Fourth Respondent has recently amended its business practices within its leased premises and no evidence has been collated by the Applicants in relation to these changed business practices thus amendment is fruitless. Further, each of the Respondents also relied upon the submissions made by each other Respondent. Applicants' arguments in reply 16. The Applicants rely on General Steel Industries Inc v Commissioner of Railways (NSW) & Ors (1964) 112 CLR 125 to argue that, before making an order to dismiss or strike out, the Respondents' pleadings must show that the process impugned is so obviously untenable that it cannot possibly succeed. The Applicants argued that the Points of Claim, as drafted, made it clear that what is alleged against the Respondents is a breach of the Environmental Planning and Assessment Act 1979 (the EP&A Act), as stated in par 57 of the Points of Claim, namely, the assertion that "… in the circumstances pleaded above, each of the Respondents is carrying on development in breach of condition 11 of development consent no. 9900/377 granted on 30 May 2000 with respect to the premises" and that this pleading is sufficient to give rise to a cause of action.