Burling Realty Commercial & Residential Sales Pty Limited ACN 134 887 291 v L J Hooker Limited ACN 003 890 453 [2012] NSWSC 551

Supreme Court New South Wales

Medium Neutral Citation: Burling Realty Commercial & Residential Sales Pty Limited ACN 134 887 291 v L J Hooker Limited ACN 003 890 453 [2012] NSWSC 551 Hearing dates: 14 to 16 May 2012 Decision date: 24 May 2012 Jurisdiction: Equity Division Before: Ball J Decision: (1)Declare that the defendant has given approval to the plaintiff pursuant to clause 3.3 of the residential franchise agreement made on 8 April 2009 between the plaintiff and the defendant (the Franchise Agreement) to operate the Business (as defined in the Franchise Agreement) from the premises known as 19 Broughton Street, Kirribilli, New South Wales. (2)Order that the defendant be restrained from terminating the Franchise Agreement in reliance on the notice of breach dated 19 January 2012. (3)Order that the defendant pay the plaintiff's costs of the proceedings. Catchwords: EQUITY - permanent injunction - order restraining termination of franchise agreement - no question of principle. Cases Cited: Jones v Dunkel (1959) 101 CLR 298 Manly Council v Byrne [2004] NSWCA 123 Category: Principal judgment Parties: Burling Realty Commercial & Residential Sales Pty Limited ACN 134 887 291 (Plaintiff) L J Hooker Limited ACN 003 890 453 (Defendant) Representation: JC Giles (Plaintiff) G Lucarelli (Defendant) Somerville Legal (Plaintiff) Thomson Lawyers (Defendant) File Number(s): 2012/51331

Judgment 1The plaintiff, Burling Realty, operates commercial and residential real estate agencies as a franchisee of the defendant, LJ Hooker. Prior to 22 October 2011, it operated both franchises from premises situated at Level 7, 221 Miller Street, North Sydney. However, on 15 August 2011, it exchanged contracts to buy the retail business carried on by Deborah Richardson Real Estate in Kirribilli, which included a lease of premises in Broughton Street, Kirribilli. Following the completion of that purchase on 21 October 2011, Burling Realty started operating its residential franchise from the Broughton Street premises. 2LJ Hooker says (and it is not disputed) that cl 3.3 of the residential franchise agreement required Burling Realty to obtain LJ Hooker's approval to the move to the Broughton Street premises. LJ Hooker further says that that approval was never sought nor given. On 19 January 2012, following complaints from the LJ Hooker Mosman franchisee and an unsuccessful mediation, LJ Hooker served a notice of breach requiring Burling Realty to cease operating its retail franchise from the Broughton Street premises by 29 February 2012. In response, Burling Realty commenced these proceedings seeking various interlocutory orders including an interlocutory order restraining LJ Hooker from terminating the residential franchise agreement. Those interlocutory orders were made by consent on 20 February 2012. The question now is whether those orders should continue on a final basis. The answer to that question turns solely on whether LJ Hooker gave its approval to Burling Realty moving its retail franchise to the Broughton Street premises.