Tabbouche Enterprises Pty Ltd (atf Tabbouche Family Trust) v Cromwell Seven Hills Pty Ltd [2016] NSWCATCD 51

Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Tabbouche Enterprises Pty Ltd (atf Tabbouche Family Trust) v Cromwell Seven Hills Pty Ltd [2016] NSWCATCD 51 Hearing dates: 30 March 2016 Decision date: 21 June 2016 Jurisdiction: Consumer and Commercial Division Before: Geoffrey Meadows, Senior Member Decision: (1) The respondent is ordered to pay compensation to the applicant in the amount of $34,900.00 within 30 days of the date of these reasons. Catchwords: ADMINISTRATIVE LAW—Residential Tenancies—claim for rent reduction for withdrawal of services—claim for rental bond—claim for damage to personal property—claim landlord breached Residential Tenancies Act 2010 and lease—no appearance by landlord—ex parte hearing in the interests of justice—order in favour of tenant—application otherwise dismissed. Legislation Cited: Civil and Administrative Tribunal Act 2013 Residential Tenancies Act 2010 Cases Cited: Bite Food Group Pty Ltd v Ubertas Funds Management Pty Ltd [2010] VCAT 253 Softwash Castle Towers Pty Ltd v Queensland Investment Corporation [2009] NSWSC 490 Category: Principal judgment Parties: Tabbouche Enterprises Pty Ltd (atf Tabbouche Family Trust) - (applicant); Cromwell Seven Hills Pty Ltd (respondent) Representation: Mr Ali Tabbouche (applicant) Mr Firmanis (respondent) File Number(s): COM 15/65606 Publication restriction: Nil

REasons for decision

BACKGROUND 1. This is an application by a former tenant of retail premises, Bite Food Group Pty Ltd ("the Tenant") for an order pursuant to s 56(4)(b) of the Retail Leases Act 2003 ("the Act") for reasonable compensation for the fit out of leased premises following the determination of a lease pursuant to a demolition clause. 2. The section (where relevant) provides as follows: 35 Demolition (1) … (3A) If a retail shop lease is terminated on such a ground, the lessor is liable to pay the lessee compensation for the fitout of the retail shop if the lessee is required under the lease to fit out the retail shop, whether or not the demolition of the building is carried out. … 1. On or about 23 April 2012 the applicant signed a franchising agreement with a franchisor known as Blow Dry Bar Franchising Pty Ltd. The Schedule to that agreement stated that the premises were Shop 16, 100 Miller Street, North Sydney. 2. On or about 30 January 2013 the applicant signed a sub-lease for a term of 5 years commencing on 1 October 2012, terminating on 30 September 2017 with an option to renew for a further five years. The Torrens Title details in the lease refer to "Shop P17, 100 Miller Street, North Sydney" but there appears to be no dispute that the shop details are correctly set out in the previous paragraph, that the sublease (being No. AH665820V) relates to those premises. 3. The applicant asserts in these proceedings that the franchising agreement provided for the franchisor to complete the fitout of the premises but that the applicant was required to pay for the fitout. The applicant states that the sum of $120,000.00 was expended by it in that regard. 4. The respondent purchased the subject building ("Northpoint Tower") on or about 19 December 2013 and in doing so became the landlord of the applicant. 5. On or about 3 September 2015, desiring to significantly renovate the building or parts of it, the respondent served a demolition notice pursuant to the lease on the applicant. 6. The applicant alleges that the respondent has not agreed to pay reasonable compensation for the fitout pursuant to s 35 of the Retail Leases Act 1994 (RL Act) and filed this application on 8 December 2015. 7. Although it appears there may have been other issues between the parties previously, the applicant states in his affidavit dated 25 January 2016 that the dispute has been resolved except for the provision of reasonable compensation and two other lesser issues, as set out under the heading "The Claim" below.