Appetites International Pty Ltd v Goldsea Pty Ltd [2004] QSC 395

State Reporting Bureau Jacctffjoscs^ Queensland Government Department of justice and Attorney-General Transcript of Proceedings Copyright in this transcript is vested in the Crown. Copies thereof must not be made or sold without the written authority of the Director, State Reporting Bureau. SUPREME COURT OF QUEENSLAND CIVIL JURISDICTION WHITE J REVISED COPIES ISSUED State Reporting Bureau Date: 21 October, 2004 No BS7311 of 2004 APPETITES INTERNATIONAL PTY LTD ACN 102 341 480 and GOLDSEA PTY LTD ACN 009 637 521 Applicant Respondent BRISBANE ..DATE 19/10/2004 JUDGMENT WARNING: The publication of information or details likely to lead to the identification of persons in some proceedings is a criminal offence. This is so particularly in relation to the identification of children who are involved in criminal proceedings or proceedings for their protection under the Child Protection Act 1999, and complainants in criminal sexual offences, but is not limited to those categories. You may wish to seek legal advice before giving others access to the details of any person named in these proceedings. 4th Floor, The Law Courts, George Street, Brisbane, Q. 4000 Telephone: (07) 3247 4360 Fax: (07) 3247 5532 -- 1 of 7 -- HER HONOUR: Goldsea Pty Ltd is the owner of the Oasis 1 Shopping Centre at Broadbeach on the Gold Coast. It includes an area on the second level of about 1000 square metres which is operated as a restaurant known as Joe's Brassiere. The lessee of the restaurant is Appetites International Pty Ltd, a 10 company incorporated by Mr Theo Morris for the purpose of entering the lease which he did on the 24th of December 2002. By notices dated 30 July 2004 Appetites was given notices to remedy breach of lease and notice to deliver up possession. 2G The notice to remedy breach concerned breaches of covenants to keep the premises clean and sanitary and failure to comply with the requirements of the Food Act 1991 as set out in a letter to Appetites of 22 June 2004 from the Gold Coast City Council Health Department. 30 Appetites brought proceedings seeking declarations and injunctions restraining Goldsea from proceeding with its notices. On 1 September 2004, the return date of an application for interlocutory injunctive relief, Justice Byrne 40 made orders by consent that Goldsea be restrained from issuing any demand for the possession of the premises until the determination or resolution of the matter. His Honour also gave directions for the progress of the proceedings and a timetable which counsel inform the Court is almost complete. 50 The consent orders were premised upon certain undertakings given by Appetites which principally for this application concern compliance by Appetites with the requirements of the 19102004' T1/RB28 M/T 1/2004 (White J) 2 JUDGMENT 60 -- 2 of 7 -- Gold Coast City Council in respect of the premises including the notice of 22 June 2004. 19102004 T1/RB28 M/T 1/2004 (White J) Goldsea contends that Appetites has failed to comply fully with its obligations under the undertakings given to the Court and seeks to have the injunction discharged. It was not suggested that the Court could not do so. The High Court in Adam P Brown Male Fashions Pty Ltd v. Philip Morris Inc (1981) 148 CLR 170 said at 178: "But in our opinion a Court undoubtedly has such a power just as an interlocutory injunction continues 'until further order', so must an interlocutory order based on an undertaking. A court must remain in control of its interlocutory orders. A further order will be appropriate whenever inter alia new facts come into existence or are discovered which render its enforcement unjust." See also Spry - Principles of Equitable Remedies at page 593-4. A brief mention of the background needs to be made. The demised premises which had operated as a restaurant under previous lessees was left vacant for some four or so months in 2002. In the interim the restaurant was, according to Mr Goodfellow who was until mid-2004 the Centre Manager at Oasis, vandalised. The equipment which Appetites took over was heavily used as were the premises and needed substantial refurbishment . 3 JUDGMENT -- 3 of 7 -- At the time Mr Morris was considering going in the restaurant Goldsea proposed building above the Centre to 38 floors. Appetites entered into a monthly tenancy for the period of constructions and an agreement to lease for a fixed term thereafter. Mr Morris deposes to the difficulties he faced during demolition, destruction, and development of the site. To a large extent this is supported by Mr Goodfellow's memorandum to the incoming manager, Mr Darnell. The memorandum mentions an agreement by Goldsea to carry out some works in the kitchen area to avoid closure by the Health Department which included the sealing of eroded floor areas under the appliances, so it is clear that it is recognised by Goldsea that the condition of the premises made matters of cleanliness somewhat difficult. Management received a number of complaints about the cleanliness of the restaurant from outside persons. The inspection by the Gold Coast City Council inspector leading to the extensive list of works to be done to comply with health concerns and to an inspection on 6 August led to activity by Mr Morris and his staff. He has deposed to what was done in his affidavit of 25 August filed for the proceedings on 1 September. The Gold Coast City Council reinspected on 27 September and there remain some 13 defects and a notation that the premises were unclean. Further matters requiring remedy were noted. 19102004 T1/RB28 M/T 1/2004 (White J) 1 10 20 30 40 50 4 JUDGMENT 60 -- 4 of 7 -- Mr Morris deposes to attending to these matters by the council deadline of 30 September. A compliance inspection was made by an officer of the council in early October at which, Mr Morris deposes, the inspector expressed satisfaction. A particular concern relates to pest control. Mr Morris responds in detail to the steps he and his staff have taken including retaining new pest control exterminators. There is no evidence from the Gold Coast City Council of recent date indicating its dissatisfaction with the response to the various notices after the last inspection. Goldsea has retained a Mark Rigby, a professional environmental protection and environmental health consultant. He inspected the premises on 15 October to ascertain the extent of Appetites Compliance with the Gold Coast City Council notices. He has set out his findings in a table exhibited to his affidavit. Some of the matters Mr Rigby says are still outstanding are minor or trivial, for example the door seals on the refrigerator which the restaurant manager deposes are stain marks and not food stains. The most serious remaining complaint seems to be the signs of rodent and pest presence by recent droppings. Mr Morris deposes that the premises were fumigated three times last week. Despite Goldsea exhibiting a complaint and summons by the Gold Coast City Council directed to Appetites dated 21 September 2004 Mr Morris denies that he or the company has been served. It relates to the inspection on 6 August 2004 19102004 T1/RB28 M/T 1/2004 (White J) 1 10 20 30 40 50 5 JUDGMENT 60 -- 5 of 7 -- 1 and many of those matters have been attended to. It would appear that there is no evidence that there is any outstanding complaint and summons. It is clear from the contradicting affidavits filed on behalf of Appetites that it may be something of a subjective assessment whether premises or items within it are clean and much could not be resolved on a hearing of this kind. There do, however, appear to be some real concerns about the presence of vermin and Mr Morris has sought to address them by an increased attention to fumigation. The Gold Coast City Council has not taken further action against Appetites and it is charged with public health matters. If the injunction is dissolved there will be job losses for about 15 staff and the loss of Mr Morris' investment built up over nearly two years of difficult circumstances. Should Appetites be successful in the litigation no doubt damages would be recovered, but other things such as personal exertion cannot. This is not a case where there has been a cavalier disregard for the undertakings. Further the nature of the undertakings makes it difficult for Appetites to ascertain if they have been complied with. The last inspection deposed to by Mr Morris suggests that so far as his understanding is concerned they have been. 19102004 T1/RB28 M/T 1/2004 (White J) 10 20 30 40 50 6 JUDGMENT 60 -- 6 of 7 -- The matter is close to seeking trial dates and should be heard and determined this year. Appetites pays its rent and outgoings so, apart from public health concerns which may impact adversely on the Centre generally, there is no identified prejudice to Goldsea in the status quo continuing. Accordingly I would dismiss Goldsea' s application to dissolve the interlocutory injunction made on 1 September 2004. 19102004 T1/RB28 M/T 1/2004 (White J) HER HONOUR: In this matter it seems to me that none of the submissions that have been made by Mr Wilson would suggest that there should be an order other than that costs should follow the event. The public health issues to which he adverted are matters that could have been taken up with the Gold Coast City Council since they are charged with those matters. I accept that there will be always an interest in a landlord with respect to these things but it seems when you look at the whole of the correspondence and the activity here that that may not have been the dominant purpose of the application . The applicant Goldsea to pay the respondent Appetites costs of and incidental to this application to be assessed on the standard basis. 1 10 20 30 40 50 7 JUDGMENT 60 -- 7 of 7 --