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Benchmark - Real Estate Cases & Commentary
Retail leases
    •  Quiet enjoyment
        -  Breach of right to quiet enjoyment



Breach of right to quiet enjoyment 
 
Since 1980, a tenant in a shopping centre owned, managed, and operated a real estate agency as a sole licensee. His landlord, the owner of the shopping centre, carried out renovation works at the shopping centre in ways that amounted to a breach of the tenant’s right to quiet enjoyment of the premises.

Beginning in 1995, the tenant suffered business losses as a result of the renovations because, among other things, walk-in clientele in particular could no longer find him amid the renovation works. He was awarded damages for these losses.

The tenant also alleged that some of the landlord’s decisions should be set aside because they were unconscionable. These were the landlord’s actions in pressuring the tenant when he as in a vulnerable position, particularly in regard to giving him no practicable alternative but to sign a deed regarding the renovation that included an abatement of rent, insisting that he pay disputed rent before being able to exercise an option, relying on the lease to increase the rent by more than a reasonable amount without giving reasons, and by sending letters that included disrespectful epithets.

While Tribunal considered that the landlord’s conduct was very unsympathetic to the tenant, and displayed an unhelpful reluctance to reach a compromise with him, it was not “highly unethical” and did not involve a “high degree of moral obloquy”. The Tribunal held, therefore, that the landlord’s conduct was not unconscionable within the meaning of the Retail Leases Act 1994, and did not award the tenant damages for the expenses he incurred in moving to new premises.

Horwood v Memocorp Australia Pty Ltd [2010] NSWADT 69