Sea One North Pty Limited v lgnazia Pty Limited [2024] NSWSC 343

Supreme Court New South Wales

Medium Neutral Citation: Sea One North Pty Limited v lgnazia Pty Limited [2024] NSWSC 343 Decision date: 18 March 2024 Jurisdiction: Equity - Real Property List Before: Peden J Decision: See [26] Catchwords: LEASES AND TENANCIES — Renewals and options — Exercise of option — Validity of exercise — Whether email correspondence a sufficiently absolute and unqualified exercise of option Cases Cited: Hagerty v Hills Central Pty Ltd (2018) 19 BPR 38,853 Jong v Advanced Dental Services Pty Ltd [2019] NSWCA 318 Prudential Assurance Co Ltd v Health Minders Pty Ltd (1987) 9 NSWLR 673 Quadling v Robinson (1976) 137 CLR 192 Willis Australia Ltd v AMP Capital Investors Ltd [2023] NSWCA 158 Category: Principal judgment Parties: Sea One North Pty Limited (Plaintiff) lgnazia Pty Limited (Defendant) Representation: Counsel: G Farland (Plaintiff) L Cooper-Hackman (Plaintiff) M Jaireth (Defendant)

Solicitors: Holding Redlich (Plaintiff) Back Schwartz Vaughan (Defendant) File Number(s): 2023/00439145 Publication restriction: Nil

ex tempore JUDGMENT 1. This is an option dispute. The plaintiff, Sea One North Pty Limited (Sea One), submits as tenant it did not exercise an option to renew registered lease AM2058R, dated 7 July 2016. The defendant, Ignazia Pty Ltd (Ignazia), submits that Sea One did exercise the option by way of a 5 June 2023 email sent by Mr Chris Barbour, the sole director of Sea One, to Mr Stephan Ippolito, agent of Ignazia. 2. The critical provision for the option to renew is contained in cl 22.1 of the lease, which provides as follows: 22. OPTION TO RENEW 22.1 Option for renewal If the Lessee desires a lease of the Premises for the further term set out in Item 8 of the Appendix and gives to the Lessor not more than twelve (12) and not less than six (6) months' notice in writing to that effect prior to the expiration of the Term then, subject to clause 22.2 and to any Guarantor under this Lease covenanting to continue their guarantee of the obligation of the Lessee, the Lessor must grant to the Lessee a lease of the Premises for the further term commencing on the day following the date of expiration of the Term. The lease for the further term is on the same terms and conditions as this Lease except that: (Multiple Options): if the number of options specified in Item 8A of the Appendix is: one, then this subclause 22 and Item 8 and Item 8A of the Appendix are deleted; or greater than one, then the number of options in Item 8A of the Appendix is reduced by one; (Variables): Items 3, 3A, 4A, 48, 4C, 5A, 58 and 6A of the Appendix are changed to incorporate the terms of the further lease set out in item 8 of the Appendix; and (Update): Items 10, 11 and 12 of the Appendix are amended in accordance with the reasonable requirements of the Lessor." 1. Items 8 and 8A of the appendix to the lease, as referred to in cl 22.1, provide as follows: ITEM 8 Option Term: One (1) option for a further lease of five (5) years Rent Commencement Date The Commencing date of the Option Term Commencing Date: 15 December 2023 Terminating Date: 14 December 2028 Base Rent in Option Term: The Base Rent payable immediately prior to the Commencing Date for the Option Term increased by 3 % Market Review Dates in Option Term: Not applicable CPI Review Dates in Option Term: Not applicable Percentage Review Dates in Option Term: Each anniversary of the Commencing Date of the Option Term. ITEM 8A Number of Options: One (1)