Edwards T/A Sublime Body Spa v Longton (No 2) [2005] RSLT 3

[2005] RSLT 3 THE RETAIL SHOP LEASES ACT In the matter of Dispute 30/04 KRISTEN ELIZABETH EDWARDS (T/A SUBLIME BODY SPA) - Claimants and COLIN LONGTON (AS POWER OF ATTORNEY FOR MARY JANE JOYCE LONGTON) - Respondents DECISION Coram: Mrs Anne Forbes Mr Trevor Davies Mr Malcolm Macrae Given in Brisbane on 23 February 2005. -- 1 of 14 -- Edwards-v-Longton Decision 2 1. The Claimant tenant, Ms Edwards [“the Tenant”] was the first tenant of Unit 1 in a newly built strata-titled group of shops called Soho. There she conducted a beauty salon called “Sublime Body Spa”. Her three-year tenancy commenced on 15 December 2003 at a rent of $20,460 per year plus outgoings. The Respondent owner of Unit 1, Mrs Mary Longton, is an elderly woman confined to a nursing home and at all material times her son Mr Colin Longton [“the Landlord”] acted for her, as holder of an enduring power of attorney. 2. On April 19 2004 the Tenant lodged a Notice of Dispute under the Retail Shop Leases Act 1994 [“the Act”]. In essence it claims that:- [a] inadequate air-conditioning in the premises and a failure of the Landlord to correct it – • prevented the Tenant, for 3 months, from beginning to trade; • caused financial loss; • entitles her to a reduction in rent; and • entitles her to an adjustment of the commencement date of the lease. [b] an external sign-box provided in the lease was deficient. MEDIATED AGREEMENT 3. In accordance with the Act the dispute was referred to mediation on 12 May 2004, and the parties reached an agreement. The terms of that agreement were reduced to writing and signed by the parties’ representatives, whose authority for that purpose was not in issue during the hearing. 4. The terms of the mediated agreement are:- “The [Landlord] agrees to the following terms:- (a) that the [Tenant] pay half the full amount of the rental as set out in the relevant lease herein for the first six months of the tenancy (rather than the first three months of the tenancy as set out in the lease); (b) that the Respondent carry out the following works on the subject rental premises:- (i) expending up to $1,500.00 towards the re-balancing of the air- conditioning, such works to be carried our within three months of today’s date (NB any other air- conditioning options to be at the tenants expense); -- 2 of 14 -- Edwards-v-Longton Decision 3 (ii) the supply and installation of an extra signage display box outside the subject premises (excluding signage) subject to the body corporate, Delfin Pty Ltd and Council approval. The [Tenant]accepts the abovementioned offer of the lessor in full satisfaction and discharge of [her] claim under this reference of Dispute. DATED at Southport this 12th day of May 2004.” 5. The Tenant, Ms Edwards, is variously described in the agreement as “the Claimants”, ”the “tenants” [sic] and the “lessee”, but nothing turns on these infelicities of drafting. 6. In her written submissions delivered after the hearing, the Tenant, for the first time, questions the authority of Mr Smith, the business advisor from Leopard Communications who represented her at the mediation. Of course, submissions about evidence are not themselves evidence and it suffices to say that the hearing concluded on the basis that the relevant authority existed. We find that to be the case. 7. It may be appropriate at this point to emphasise that evidence in the case cannot be altered or added to by argument or assertion not on oath after evidence is closed. AMENDED CLAIMS 8. The Tenant now claims that the Landlord has not complied with the mediated agreement and, further, that the air-conditioning in the premises is not in accordance with the lease and certain preliminary documents. She seeks compensation under ss 43(1)(d) and 42(2) of the Act. The quantum of her claim increased from $30,000 in June 2004 to $84,317 in November 2004, and then – three days before the hearing - to $249,607 (an amount just within the limits of the tribunal’s jurisdiction). STATUS OF THE AGREEMENT 9. The tribunal’s first task is to determine the present status of the agreement made on 12 May 2004. If it remains valid, it follows that the Tenant’s claim against the Landlord has merged in the agreement, and can no longer be relied upon as a cause of action in its own right.1 10. The position might well be different if the Notice of Dispute disclosed a new claim or claims, distinct from the original matter. But (1) is that the position here, or (2) is 1 Butler v Fairclough (1917) 23 CLR 78 at 96. -- 3 of 14 -- Edwards-v-Longton Decision 4 the Tenant’s claim the same cause of action that was raised in her original Notice of Dispute, notwithstanding an increase in the amount of compensation sought? If the answer to question (2) is “Yes”, then that is an end of this matter, provided that the Landlord has complied with the agreement. Within the limits of a hearing at which the Tenant was not legally represented, we confined the present hearing to the question of compliance, on the basis that, if we decide that the agreement is no longer effective, we would proceed, at a later date, to examine the claims for compensation. 11. The hearing as to the status of the agreement occupied 1½ days. The Tenant’s mother, Mrs Edwards, who has been closely involved in the operation of the business, represented the Tenant, as she did in negotiations and at several directions hearings. The Landlord was represented by a solicitor, Mr Geddes. THE LEASE AND OTHER DOCUMENTS 12. The Tenant signed the lease (Exhibit 28) on 18 December 2003. An advertisement of the premises by leasing agent FPD Savill describes the air-conditioning system therein as “split system zoned air conditioning”. The prior agreement to lease provides inter alia that the Landlord will install air-conditioning in the premises “as soon as practicable” as well as blinds to shade the west-facing window The agreement to lease, the Landlord’s disclosure statement and the lease itself are silent on the type and capacity of the system to be provided. 13. The permitted uses of the premises are the sale of retail skin and beauty products and the provision of a range of beauty treatments. The landlord is not liable to the tenant for any damage to merchandise and does not warrant that the premises are fit or suitable for the purposes of the lessee: Lease, Clauses 9(b) and (c). HISTORY OF DEALINGS ABOUT SIGNAGE 14. The offer to lease permits the Tenant to place a sign in an external box suspended from a beam outside the shop, provided that all necessary approvals and consents are obtained. In fact just one half of the box was available to the Tenant, so that her sign faced in one direction only. This did not meet her requirements, but a one- directional sign was erected, supplemented by some signage on her windows. 15. Although the Landlord was not responsible for additional signage he sought body corporate approval for another sign-box in January 2004. The required approvals were slow 2 in coming but in August-September 2004 the Landlord had an additional sign-box fitted, at his own expense. Initially it was incorrectly placed but 2 Longton requested provisional body corporate approval for an additional sign box and an additional cooling unit on 13 July 2004 and received approval from the body on 25 August 2004. -- 4 of 14 -- Edwards-v-Longton Decision 5 the error was quickly rectified. There was a short delay before electricity for the new sign was connected. HISTORY OF DEALINGS ABOUT AIR-CONDITIONING 16. The history from the Tenant’s viewpoint is set out in more than 70 documents comprising correspondence, undated notes and a chronology of events prepared by Mrs Edwards. That material was supplemented by oral evidence from the Tenant and her mother. 17. The landlord’s material consists of written statements of Mr Colin Longton and his wife Mrs Anastasia Longton, with items of correspondence annexed. Both witnesses gave oral evidence and were cross-examined by the Tenant. Mr Barry Stone, service manager of the air-conditioning contractor Coolco Pty Ltd, gave evidence by telephone. Unsuccessful attempts were made to obtain oral evidence from two witnesses, who had provided quotations to the Tenant on supplementary air-conditioning units, one of whom gave an opinion on the adequacy (or inadequacy) of the air-conditioning in letters that were tendered by the Tenant. 18. It is desirable to outline the history of this dispute both before and after the mediated agreement was made. 19. The Tenant says that she first inspected the premises in late October 2003. She was then offered a choice between two shops, “Unit 1” and “Unit 2”. She decided to take Unit 1 although it has a north-westerly aspect and is susceptible to long periods of heat from the sun. Both parties had legal advice during the negotiations. 20. It is common ground that in November 2003 Coolco installed air-conditioning in eight shops (including the Tenant’s) and in premises on an upper floor. The systems installed were accepted by the developer of the complex as conforming to specifications set by an engineering firm which assessed the heat loads. The system in the Tenant’s shop was tested and found satisfactory by Coolco on 11 November 2003. The shop was then “open plan”, without blinds or partitions. According to a letter from the leasing agent that forms part of the Tenant’s own material the Tenant satisfied herself before she entered the lease that the air- conditioning was adequate for her purposes. The Tenant does not challenge this evidence. 21. The Tenant took possession of the premises several weeks before the formal commencement of the lease, to supervise the fit-out. This involved the erection of two floor-to-ceiling partitions and several others, which the Tenant described as “three quarter partitions” for treatment cubicles. However, the witness Stone (from Coolco) contests that description. He says that the walls of the premises are 2.4 -- 5 of 14 -- Edwards-v-Longton Decision 6 metres high and that the gap between the ceiling and the top of the partitions (i.e. the ones that do not reach the ceiling) is only about 200-300 millimetres.3 22. The fit-out was not completed until some time in January 2004. The landlord installed the blinds to the western windows as agreed. 23. For several days in late December 2003, January 2004 and February 2004 temperatures in the area reached record levels, with the result that cooling units in the Tenant’s shop frequently overheated and shut down. Ms Kerrie Young, manager for the body corporate, states 4 that there were many approaches to the builders and to Coolco to remedy this problem. In January 2004 Mr Stone found that the heat in a plant room where the cooling units for four shops (including the Tenant’s) were installed was too great for efficient operation. He installed temporary exhaust fans in the plant room. 24. The Tenant complained of noise from the fans but because of staff shortages and seasonal demand for its services Coolco was unable to complete the job until 14 February 2004. 25. On that day Coolco’s employees relocated several of the refrigeration units from the plant room to a cooler location. Mr Stone noted that the Tenant’s system had not been rebalanced after she erected her partitioning and then redirected the ducts. Stone tested the system on 16 and 17 February 2004 and found that it was cooling to the proper temperature of about 21 degrees Celsius in the Tenant’s shop and elsewhere in the complex. The building manager supports this evidence. 26. The Tenant did not open her business until 3 March 2004. The delay in trading between 17 February (when Stone found the air conditioning satisfactory) and 3 March was not, in our view, adequately explained by the Tenant, although she made the broad assertion in cross-examination that she was still experiencing ”major heat problems” at the time. 27. The Tenant claims that cooling problems persisted for many months thereafter, particularly in the reception area where her beauty products were stored. Indeed she says that the Landlord never remedied the air conditioning, and consequently she ceased trading in October 2004. She also says that stress of work under these conditions prevented her from working several times between February and October 2004. 28. Mrs Longton, for the Landlord, discussed the air-conditioning and other matters 5 with the Tenant on 1 April 2004 and says that they agreed to wait until the winter months for further assessment of the system. She says that the Tenant did not 3 Exhibits 20 and 21 are photographs of the interior of the premises. 4 Letter to Tenant dated 25 October 2004 5 Matters in issue in April 2004 included the provision of a registered copy of the lease to the Tenant. This had been delayed according to the Respondent by Land Titles Office requisitions concerning the Enduring Power of Attorney. -- 6 of 14 -- Edwards-v-Longton Decision 7 then seem particularly concerned about the system, which was turned off at the time of their discussion. The Landlord says he was surprised to be served with the Notice of Dispute so soon after that meeting as he believed that the air-conditioning was “not an issue” then, as the discussion between Mrs Longton and the Tenant was mainly about rent. DEALINGS AFTER 11 MAY 2004: AIR-CONDITIONING 29. On 9 June 2004 Mr Smith (for the Tenant) wrote to the Registrar of the tribunal claiming that the Landlord had indicated by letter that “he may not comply with the mediation ruling”, that the “air-conditioning offered as a condition of the lease was and is still not adequate to the needs of the business” and that it was not a split- cycle system. 30. On 10 June the Landlord issued a default notice reminding the Tenant that her rent was in arrears, notwithstanding the extra period of rent remission agreed on mediation. 6 31. On 15 June Longton wrote to Smith 7 denying any intention on his part to resile from that agreement. On the contrary he had already directed Coolco and another specialist to check the air-conditioning. He added: “[W]e will ensure that the air conditioning is rectified, even if it means putting an additional split system at the front of the premises at our cost”. He reminded Smith that performance of the agreement and any additional work was conditional upon the Tenant bringing her rent up to date. 32. On 16 June Mr Stone (of Coolco) came to the Tenant’s shop, relocated the air- conditioning outlets, and redirected the air flow to the front of salon. Mrs Edwards says that she objected to this procedure 8 , but Stone said the adjustments were necessary. Stone monitored the premises and found fairly consistent and satisfactory temperatures there from that time onwards. The system was cooling to 21 degrees Celsius at the rear of shop and 21.5 at the front. 33. Asked to comment on the design of the system Stone responded: “[I]t was designed for an open plan shop – the effect of partitioning meant the original duct layout did not provide adequate air flow throughout the tenancy. Once we’d moved the additional grille out to the front of the shop, that allowed more air to the front of the shop, and with the return air being at the rear of the shop, it means that the cycle of air was coming from the cold air to the front of the shop, flowing through the shop and then back up the returner at the back of the shop, which gave them a more 6 See Exhibit 2- Calculation of Boniface & Co, Accountants. By June 1 rent of $3,751 was owed and $663 outgoings. Payments of only $1,705 had been made by the tenant. 7 Exhibit 9 8 Handwritten document prepared by Mrs Edwards dated 1.10.04. -- 7 of 14 -- Edwards-v-Longton Decision 8 even distribution of temperature through the shop. Of course, with partitioning it’s never perfect, because you always are going to get slightly warmer and slightly colder spots … because … the air can’t flow directly back on a direct line. But from our measuring [there was] very little variation through the shop.” 34. On 17 June 2004 Mrs Edwards contacted Stone to demand that the balancing be reversed, as the rear of the shop was not cool enough. According to her Stone refused, saying that the Landlord was installing another unit and that the system would remain as it was until then. 35. On 21 June the Tenant (through Smith) responded to the Notice of Default in a letter 9 containing this concession: “The Lessee acknowledges the fact that repairs and faults to the air- conditioning are not the responsibility of the Lessor.” That point is not at issue.” (Emphasis added) Smith’s letter went on: “The point at issue is whether or not the air-conditioning was functioning on the original lease commencement date as per representations made to the Lessee and relied upon by the Lessee in accepting the Offer to Lease.” 36. On 22 June 2004 10 Mr Wilson, the Landlord’s solicitor, made an open offer of settlement, to this effect: • The signage would be completed within a reasonable time after Council approval was obtained; • The Landlord would install another split cycle unit at the front of the Tenant’s shop within 30 days of body corporate approval; • The Landlord would waive all rent for the first three months of the term and give remission of ½ rent for the six months from March to August 2004 inclusive on condition that the tenant immediately paid the (revised) rent for that period, plus outgoings. • The Landlord would not seek costs, provided that the Notice of Dispute was withdrawn. 9 Exhibit 3. 10 Exhibit 8. -- 8 of 14 -- Edwards-v-Longton Decision 9 37. On 22 June 2004 the Tenant, by her agent Smith, responded: “Please be advised that the [Tenant] will only accept your offer if it includes half rent for six months after the commencement of the lease or after the extra air- conditioning has been installed, whichever is the longer period. The [Tenant] also believes the lease should commence on March 15 [2004] the day the business opened for trading, otherwise [she] will rely on the …Tribunal to make a ruling…” 11 38. However, on 1 July Smith wrote to the Tenant 12 enclosing a letter from Coolco stating that the air-conditioning was operating properly by 1 March 2004. At the same time Smith advised the Tenant that in his experience and in the present case the Landlord: • is only required is to supply air-conditioning to empty premises; • is not obliged to tailor air-conditioning to a Tenant’s particular needs. 39. Smith concluded with advice that, unless the Tenant could substantiate her claim in the tribunal, she should rest content with the Landlord’s undertakings in the agreement of 12 May 2004. Unhelpful as this letter is to the Tenant’s case there is no basis upon which privilege could be claimed, even if it had not been given (as it was) by Mr Smith to the Landlord. 40. On 8 July 2004 the tribunal conducted a directions hearing by telephone. Mrs Edwards spoke for the Tenant. The Landlord told the tribunal of his offer of 22 June and said that he had already paid for the system to be rebalanced as agreed. Mrs Edwards was asked whether the Tenant accepted the offer of June 22 and answered in the affirmative. The chairman of the tribunal then suggested that an unequivocal, written acceptance should be made as soon as possible. Meanwhile, as the three months for compliance with Clause (b)(i) of the agreement of 12 May 2004 had not yet elapsed, the matter was adjourned to a date to be fixed, after August 12, 2004. 41. On 29 June 2004 Mr Stone, of Coolco, arrived at the Tenant’s shop to decide where a supplementary unit could be placed. Mrs Edwards, in evidence, complained that Stone said he would put the unit wherever he thought best, as the Landlord was paying. On 1 July Coolco sent a quotation of $2,950 for the new unit to the Landlord, with a note that Mrs Edwards “did not consent to this”. 42. The Tenant sought quotations from other firms. Their quotations ranged from $5,000 to $6,000. There is no evidence that any of them made a thorough analysis of the Tenant’s particular requirements. A Mr Havenaar ventured an opinion in writing that the existing system was inadequate. However he later withdrew that opinion, complaining that it was based on misleading information from the Tenant. 11 Exhibit 7. 12 Exhibit 18. -- 9 of 14 -- Edwards-v-Longton Decision 10 43. On 11 August the Landlord’s solicitor wrote to the Tenant to confirm “that you will deliver to our office your response to the offer contained in our 22 nd June letter to you.” However, there is no evidence that the Tenant ever accepted the offer of 22 June in all its terms. 44. On 7 September 2004 Mr Stone (of Coolco) wrote to the Tenant with the specifications of the proposed new unit. On the same day he e-mailed the Landlord to say that he had tried four times to discuss its location with the Tenant, but to no avail. His preference was for the western external wall. The Tenant rejected that suggestion, saying that it would direct cold air upon her clients. She insisted that it be put in another position which, according to Stone, would create plumbing difficulties and extra expense. 45. On 15 September a second directions hearing took place. On this occasion Mr Smith spoke for the Tenant, in the presence of Mrs Edwards. Mr Wilson, solicitor for the Landlord, told the tribunal that his client’s position was that his obligations under the mediated agreement had been fully performed, although discussions about an additional unit could continue. Mr Smith replied that the Tenant had rejected an offer of a unit valued at $2,600, and insisted that a “split-cycle system” be provided. 46. On 17 September Mr Stone (for Coolco) confirmed the Landlord’s acceptance of his quotation for supplementary air-conditioning. 13 However, he was having difficulties with the Tenant about a date for installation. Summer was approaching, demands for his company’s services were increasing, and there might be significant delay if a date were not set soon. 47. On 27 September the parties and their representatives met at the Tenant’s shop to decide where the new unit and air vents would be located. The meeting began at about 9.30 am and lasted for more than 2 hours. As noted above, Mrs Longton’s evidence is that the existing air conditioning in the shop was not turned on. According to Mrs Longton, Mrs Edwards said that Mr Stone told her to leave it off, so as to avoid damage to the system. Stone denied that he had done so. No agreement was reached that day. 48. On 29 September 2004 the landlord wrote to the Tenant urging her to decide where the new unit was to go and assuring her that Coolco would put it where she directed, whether or not it was the location they preferred. On the same day Mrs Edwards sent a fax to the Landlord claiming that she had accepted his offer of 22 June at the directions hearing on 8 July: “As I stated at the directions hearing we accepted rent to start from 15th March for 6 months at half rent” 13 Exhibit 10 -- 10 of 14 -- Edwards-v-Longton Decision 11 49. At about 12.30 pm on 30 September Mrs Longton called at the Tenant’s shop to deliver a summary of the meeting on 27 September and found the place nice and cool”. 50. On 5 October, as the rent went further into arrears, the Landlord sent another notice to the Tenant to remedy the breach. He was prepared to apply the bond moneys of $5000 to the arrears if the Tenant provided a bank guarantee for the same amount. There is no evidence of any positive response on the Tenant’s part. 51. On 7 October Mr Stone wrote to the Landlord about the meeting of 27 September, giving his reasons for rejecting the Tenant’s choice of location for the new unit, but stating that he would put it wherever she wished, if Mrs Edwards gave him the go- ahead. He recalled that she told him she had not run the air conditioning during the winter, for fear that damage would result. He had never given such advice. Mrs Edwards denied making any such statement to Stone, but did not unequivocally state that the system had been used during the winter months. 52. In October 2004 the Tenant moved her stock and equipment out of the shop and ceased to trade. A notice on the shop window informed the public that she had been forced to close “due to no air conditioning”, but would return when renovations were made. 53. On 4 November 2004 the Landlord wrote to the Tenant in an attempt to settle the whole affair by abandoning any claim for arrears of rent and outgoings if the Tenant surrendered the premises forthwith, and allowed him to retain the bond, then worth $5,115. The Tenant did not accept that offer and negotiations came to an end. 54. A third directions hearing took place on 1 December 2004, when Mrs Edwards insisted that the Tenant had not abandoned the premises. The Landlord said that she had paid no rent since June. Not unnaturally the Landlord was anxious to re- let the premises, and was prepared to accept the Tenant’s repudiation of the lease. 55. In January 2005 Mr Stone tested the air conditioning once more, and certified that it was cooling to the required 21 degrees. Stone testified that he has 22 years’ experience as a mechanic installing air conditioning systems in multi-storey buildings and commercial premises. As service manager in Coolco he is responsible for 35 other employees. He frequently checked the Tenant’s system, but found it difficult to get clear instructions. Eventually he formed the impression that he was being “mucked around by the Tenant”. He affirmed that the existing system is a split-cycle ducted system as described in the lease, calibrated to operate to a maximum ambient temperature of 33 degrees Celsius according to Australian Standards specifications. 56. When asked why, in those circumstances, he quoted for a supplementary system he replied: -- 11 of 14 -- Edwards-v-Longton Decision 12 “The only reason we recommended that they put that additional unit in was that …the Landlord] had a problem with a tenant that was giving him a bit of grief, and due to the South-East Queensland conditions exceeding the 33degrees/60% humidity, we felt that it would be in his best interests to just put an air-conditioning in to cover himself effectively from this person continually complaining. As it turns out, since we’ve been there and we’ve monitored the system, we’ve found that it didn’t really need it. It was more to appease the tenant.” 57. Stone said: “Your system didn’t fail because it wasn’t big enough to do the job. Your system failed because the plant room overheated.” 58. The Tenant tendered a letter from a tenant directly above her shop complaining that his air-conditioning had failed at some unspecified time. Stone explained that those premises were a two storey residential apartment with a day/night system, designed to work for only one storey at a time. The difficulty occurred because that resident tried to cool both areas at once. Once the outdoor units were removed from the plant room there were no more complaints from that tenant. 59. Stone explained his preference for mounting the second system on the western wall rather than a party wall: “[T]here was a plumbing pipe there. We have to utilise what’s in the shop.” 60. Stone stated that the Tenant did not allow him to enter the shop to install the additional unit, even when he told her he would put it wherever she wished. OTHER ISSUES 61. The Tenant canvassed several other concerns – late stamping of the lease, and proper handling of the bond moneys. These have no bearing on the issues in this case. FINDINGS 62. When a claim for compensation or damages is given up for valuable consideration the result is a contract of compromise that may be enforced as such, or pleaded in bar if an attempt to revive the former claim is made. The compromised cause of action is not revived by increasing the quantum of the claim. The position is of course different if a discrete cause of action arises after the compromise is concluded, but that is not the case here. -- 12 of 14 -- Edwards-v-Longton Decision 13 63. The agreement of 12 May 2004 states that it is in “full satisfaction and discharge of their [sic] claim”. There is no evidence of any event affecting the validity of that agreement; nor is there any evidence to persuade us that it was terminated or varied by any subsequent agreement of the parties. Alternative arrangements suggested by the Landlord on 22 June and 4 November 2004 met no positive response, let alone unequivocal acceptance on the part of the Tenant. Despite Mrs Edwards’ claim, five months later, that the offer of 22 June was accepted by the Tenant, we are not satisfied, upon the available evidence, that any such acceptance occurred. No date or manner of acceptance was then specified, and no relevant document has been produced. Significantly there is no evidence that the Tenant, when presented with the Landlord’s offer of 4 November 2004, responded by claiming that an agreement based on the offer of 22 June already existed, although it would clearly have been in her interests to do so. Her agent Smith did make a counter-offer, but a counter-offer is no acceptance of proposals to which it responds. 64. Pursuant to the agreement of 12 May 2004 the Landlord arranged and paid for the rebalancing of the air conditioning to the Tenant’s shop within five weeks of the mediation. The additional signage took three months to arrive. In our view that delay was not unreasonable, considering that the consents of third parties had to be obtained. 65. Further, and quite apart from the agreed settlement, neither the agreement to lease nor the lease specifies the capacity or type of air-conditioning to be provided. Indeed, the lease expressly excludes any warranty of fitness for the tenant’s purpose. 14 Common sense suggests that a prospective tenant should check the physical state of the premises – with expert assistance if necessary – to ensure that they are suitable for the project. There is expert evidence that partitions installed by the Tenant had some adverse effects on the cooling system, but no plan of the intended fit-out was submitted to the Landlord before the lease was entered into. 66. The tribunal’s task was made difficult by lack of detail and precision in the Tenant’s evidence. It is the practice of the tribunal that all evidence in chief, including statements of parties and witnesses must be filed before the hearing, and in this case there were clear directions to that effect. But neither oral evidence nor written statements provided specific evidence of shortcomings in the air-conditioning at any material time, although the Tenant’s amended notice of dispute was professionally prepared. 67. The Tenant made no satisfactory response to questions why she did not allow Coolco to install a supplementary system when the Landlord offered to do so, merely saying that “It had gone on too long”. 14 It is not implied at common law that premises are reasonably fit for the uses specified in covenants in the lease: Australian Tenancy Practice & Precedents Vol I 2975. -- 13 of 14 -- Edwards-v-Longton Decision 14 68. We prefer the specific and expert evidence of Mr Stone as to the adequacy of the original system, which he adjusted, at the Landlord’s expense, to suit the tenant’s fit-out. CONCLUSIONS 69. We find that the contract of compromise made on 12 May 2004 remains operative, and that consequently the present claims cannot be entertained. 70. If we are wrong in that view we are not satisfied upon the evidence that the Tenant has suffered any compensable act or omission on the Landlord’s part. Indeed, far from failing in his legal obligations towards the Tenant, it seems to us that the Landlord went well beyond the line of duty in attempts to appease the tenant whose expectations had no legal basis and which were pursued against the warnings and recommendations of her own advisor, Mr Smith. 71. The claim is dismissed. COSTS The question of costs is reserved for such further submissions as the parties may see fit to make. Anne Forbes Chairman -- 14 of 14 --