The Cheesecake Shop v A & A Shah Enterprises [2004] NSWSC 625

New South Wales Supreme Court

CITATION : The Cheesecake Shop v A & A Shah Enterprises [2004] NSWSC 625 HEARING DATE(S) : 3-7, 10, 12, 13, 14 May and 11 June 2004 JUDGMENT DATE : 16 July 2004 JURISDICTION: Equity Division JUDGMENT OF : Windeyer J at 1 DECISION : Judgment for possession. Order for specific performance. Cross claim dismissed.

CATCHWORDS : LEASES - Agreement to lease - Abandonment - lease for 5 years with option to renew validly exercised by plaintiffs/lessees - delay by plaintiffs in executing renewal of more than two years - whether agreement to lease abandoned. - EQUITY - Specific Performance - Availability of remedy - whether affected by laches or acquiescence - whether lack of action amounted to an implied representation that performance of renewed lease would not be required - where no evidence of disadvantage or prejudice. - CONTRACT - Franchise Agreement - Illegality - where breach of Franchising Code of Conduct, a mandatory industry code - whether breach resulted in an illegal franchise agreement - effect of Part VI of Trade Practices Act 1974 (Cth). - CONTRACT - Franchise Agreement - renewal - no new agreement ever signed - whether continued operation of franchise business constituted renewal of agreement - effect of continued operation. - CONTRACT - Franchise Agreement - termination - effect of termination on covenant not to compete. - STATUTE - Interpretation - Trade Practices Act 1974 (Cth) - effect and meaning of ss 51AD, 82, 87 Contracts Review Act 1980 LEGISLATION CITED : Franchising Code of Conduct Pt 2 s6, s10, s11 Trade Practices Act 1974 s51, s78, s80, s82, s87 Pt VI Trade Practices (Industry Codes - Franchising) Regulations 1998 (Cth), Reg 3 Brooke v Garrod [1857] 2 De G & J 62; 44 ER 911 Duke of Leeds v Earl of Amherst [1846] 2 Phill 117; 41 ER 886 Fitzgerald v Masters (1956) 95 CLR 420 at 432 Lindsay Petroleum Co v Hunt [1874] LR 5PC 221 CASES CITED : Lord Ranelagh v Melton 2 Dr & Sm 278; 62 ER 627 Marks v GIO Australia Holdings Ltd (1998) 196 CLR 494 Fry on Specific Performance 6th Ed para 1103 Meagher Gummow & Lehane Equity Doctrine & Remedies 4th Ed at 36-010 Woodfall's Landlord & Tenant 24th Ed 173 The Cheesecake Shop (Plaintiff) PARTIES : A & A Shah Enterprises (First Defendant) Abid Shah (Second Defendant) Aiesha Shah (Third Defendant) FILE NUMBER(S) : SC 4831 of 2003 COUNSEL : Mr M T McCulloch (Plaintiff) Mr S Burchett (Defendants) SOLICITORS : Cutler Hughes & Harris (Plaintiff) Alan J McKimm & Associates (Defendants)