A convenience store lease dispute shunted back to QCAT by the Supreme Court last week, raises the bar for landlords attempting to claw back court jurisdiction, where tenants have beaten them to the start by filing in the tribunal.

The court ruled* that not even claims for exotic relief – unconscionable conduct, rectification and orders under the Land Title Act 1994 that are beyond the tribunal’s powers – were enough to ignite court jurisdiction where the “real dispute” concerned the issues that had already been commenced in QCAT.

The argument concerned the lease of a convenience store at Wooloowin in Brisbane. The documents described the leased area as “that part of the ground floor hatched (sic) in the lease plan annexed”.

The lease included a lease plan depicting the whole of the interior of the ground floor as “hatched”.

The documents were signed and registered and the tenant went into occupation of the store which occupy the majority but not all of the ground floor. The landlord’s husband occupies the remainder of the ground floor as tenant at will.

After a dispute arose about outgoings, the tenant demanded that she was entitled to a tenancy of the whole of the ground floor. The landlord reply was that the lease plan was simply erroneous and did not detract from what the parties understood to be the true state of affairs.

The tenant lodged a claim in QCAT for a declaration that the lease was in respect of the whole of the ground floor. With its leave, proceedings were commenced by the landlord in the Supreme Court. The tenant filed a conditional appearance and an application to dismiss the court proceedings because of want of jurisdiction.

S94 of the RSLA gives QCAT exclusive jurisdiction to deal with retail lease disputes once the dispute is filed there, subject to some exceptions.

The exceptions include where proceedings have already been commenced in court or if a notice to remedy breach of covenant or notice to quit has already been issued. The landlord had in fact issued a notice to remedy breach of covenant to the tenant in respect of non payment of legal fees but did not assert this exception before the court because the notice was apparently somehow invalid.

The landlord relied rather on a further exception to the exclusive QCAT jurisdiction: where “an application for an order in the nature of an injunction” is made.

However, the court ruled that the “real dispute” before it, despite what was pleaded, was not for injunctive relief: it was to determine what part of the property the lease was meant to extend to. On the other hand, his honour noted that although ‘rectification’ was sought as relief, the landlord had not pleaded that if the lease were held to extend to the whole of the ground floor, she was entitled to have it rectified so that it extended only to part of it.

Either way, the fact that other relief – consequential upon the resolution of the “real dispute” – may be required was not material to determine the jurisdiction issue under s94.

Thus the matter did not come within any exceptions and pursuant to s94, the court was denied jurisdiction to hear the matter.

But was the QCAT claim a dispute under the RSLA?

Retail tenancy dispute is defined to mean “any dispute under or about a retail shop lease, or about the use or occupation of a leased shop under a retail shop lease”.

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On one interpretation – if “lease” narrowly means only the document evidencing the transaction – the dispute did not fall within the definition. However, the court considered that “the word is used in a wider sense, to describe the nature of the arrangement between the parties. In that sense it is apt to refer to an agreement for a lease.”

His honour was of the view that the tribunal proceedings would probably resolve the matter entirely but did not strike out the claim, leaving open the opportunity to enliven the proceedings for particular relief after the tribunal has decided the “real dispute”.

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* To v Choi [2011] QSC 002 Fryberg J 27/01/2011


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