Downpat Laundromat v Jones [2013] QCAT 534

CITATION: Downpat Laundromat v Jones [2013] QCAT 534 PARTIES: Mr Thomas Edward Wolfe t/as Downpat Laundromat (Applicant) V Mr Gareth Wyn Jones Mrs Rhonda Louise Jones (Respondent) APPLICATION NUMBER: RSL116-12 MATTER TYPE: Retail shop leases matters HEARING DATE: 18 July 2013 HEARD AT: Brisbane DECISION OF: Mr Jim Allen, Presiding Member Ms Sandra Kairl, Member Mr Don McBryde, Member DELIVERED ON: 14 October 2013 DELIVERED AT: Brisbane ORDERS MADE: 1. The Tribunal declares that: a. Mr Wolfe is not required to pay any outgoings under the lease including those for Trade Waste; and b. that the Notice to Remedy Breach issued by Mr and Mrs Jones on 29 August 2012 is void. CATCHWORDS: RETAIL SHOP LEASE DISPUTE – payment by lessee for trade waste services – whether trade waste services constitute an outgoing under the act – inconsistency between lease and the Act - jurisdiction of Tribunal to make declarations Retail Shop Leases Act 1994 ss 7, 20, 83 Dictionary APPEARANCES and REPRESENTATION (if any): This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act). -- 1 of 4 -- 2 REASONS FOR DECISION [1] Mr Wolfe is the Lessee of premises at Shop 3A, Eagleby Central Shopping Centre of which Mr and Mrs Jones are the Lessor. Mr Wolfe has been served with Notice to Remedy breach under s 124 of the Property Law Act 1974 on 29 August 2012 in respect of an alleged failure to pay the sum of $4,116.91 for trade waste as required under Clause 4.4 of the lease. The lease was originally entered between Nashware Pty Ltd and Saville Pacific Holdings as Lessor and Mr Wolfe as lessee on 1 April 2010 and was assigned to the current Lessors on 23 December 2011. [2] Mr Wolfe disputes that he is required to make payment for the trade waste charges under the lease. He provided a copy of the relevant clause of the lease with his application. This clause states in part that “in the event of any local or other authority providing any cleansing or refuse service for the demised premises (whether it be at the request of the lessee or by direction of any such authority) the lessee shall pay the costs to the assessing authority”. The Lessor’s submissions are reliant on the same wording of this clause. [3] A copy of the Lessor Disclosure Statement provided to Mr Wolfe at the time he entered the lease is also provided. This document clearly indicates that the Lessee is not required to make any payment for the Lessor’s outgoings, which are listed on the next page to include Local Authority rates: cleansing, general, water, other. The lease itself at item 4 indicates that outgoings are not applicable, with a reference to clause 4.5 and this clause does not appear in the lease. [4] Mr Wolfe submitted that trade waste is an outgoing of the building and that it is a reference to what was previously sewerage. The sewerage charges were previously incorporated into Mr and Mrs Jones’s rates account and were accordingly not passed on to Mr Wolfe in accordance with the lease. That trade waste is not covered by any term in the lease and is not payable by Mr Wolfe. [5] Mr Wolfe denies that clause 4.4 of the lease applies as the clause refers to “cleansing or refuse service” which the applicant submits is a reference to cleansing, rubbish and garbage services provided by council. [6] It is also noted by Mr Wolfe that a letter from Allconnex Water to Mr and Mrs Jones, which is exhibited to their response sets out that “Under s 53 of the South East Queensland water (Distribution and Retail Restructuring) Act 2009 overdue trade waste charges are payable by the current owner of the premises. [7] Mr and Mrs Jones submitted that the trade waste charges are not an outgoing of the building. That they are charges for the removal of Trade Waste from Mr Wolfe’s business. Mr Wolfe has refused to pay any of the Trade Waste charges assessed by Logan City Council and Allconnex since the day of its first occupancy and the assessment charges issued to date by Logan City Council amount to $4,116.92. That if the Trade Waste -- 2 of 4 -- 3 facility is disconnected, Logan City Council will order Downpat Laundromat to cease trading. That in good faith, and to avoid Logan City Council disconnecting the water supply, Mr and Mrs Jones have made a payment of $4,116.91 to Logan City Council. [8] Mr and Mrs Jones made further submissions in reply to Mr Wolfe’s and in particular that they agreed that the lease states “Outgoings-Not Applicable” but they assert that outgoings are defined within the Retail Shop leases Act 1994 as “expense attributable to the operation, maintenance or repair of the BUILDING.” They maintain that in this instance Trade Waste Removal is a “Service” provided for the sole use of Mr Wolfe and is not an outgoing of the building and that clause 4 of the lease was retained within the lease to address the provision of services not associated with building. It is further submitted that Building Outgoings are a cost shared by all tenants and the individual cost of waste removal for one tenant is not a cost which can be shared by other tenants. [9] Mr and Mrs Jones also exhibited a rates notice dated 16 January 2013 to their submissions which showed “water and wastewater charges of $250.17”. There is also exhibited, a separate trade waste invoice from Logan City Council dated 17 August 2012 for trade waste for the business “EAGLEBY LAUNDROMAT/DOWNPAT LAUNDROMAT”. [10] Mr and Mrs Jones accept that the section of the Retail Shop Leases Act applicable to the question of interpretation of what is an outgoing is section 7. The Tribunal notes that ss 7(2) states that an outgoing mentioned in ss 7(1) may be either an apportionable outgoing or a specific outgoing and the sum of the apportionable outgoings and specific outgoings is the lessor’s outgoings. There is a list of items which are not included in outgoings in ss 7(3) of the Retail Shop Leases Act and trade waste is not included in that list. [11] The term “specific outgoing” is defined in the Dictionary in the Schedule to the Retail Shop Leases Act as relevantly “the lessor’s outgoings that are attributable to a lessee because of the lessee’s direct use of the services or facilities incurring the outgoings”. [12] The Tribunal is satisfied that trade waste is a specific outgoing as defined in the Act and it is to be categorised as an outgoing of a lessor for the purposes of applying the terms of a lease. In this case, the lease makes it clear that outgoings are not payable by the lessee, Mr Wolfe. While clause 4.4 of the lease may be able to be interpreted to include trade waste, s 20 of the Retail Shop Leases Act makes it clear that if a provision of the Act is inconsistent with a provision of a retail shop lease, the provision of this Act prevails and the provision of the lease is void to the extent of the inconsistency. On that basis the relevant part of clause 4.4 is void to the extent that it could be interpreted to require Mr Wolfe to reimburse Mr and Mrs Jones for the payment by them of trade waste charges. -- 3 of 4 -- 4 [13] The Tribunal has power under s 83(1) of the Retail Shop Leases Act to make orders including declaratory orders, the Tribunal considers just to resolve a retail tenancy dispute. Being satisfied of the matters necessary to make the declarations sought by Mr Wolfe the Tribunal declares that: a) Mr Wolfe is not required to pay any outgoings under the lease including those for Trade Waste; and b) that the Notice to Remedy Breach issued by Mr and Mrs Jones on 29 August 2012 is void. -- 4 of 4 --