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 480  HAY STREET PTY LTD -v- UBER AUSTRALIA PTY LTD [2019] WASC 461 (23 December 2019)

Last Updated: 23 December 2019

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

IN CIVIL

CITATION :  480  HAY STREET PTY LTD -v- UBER AUSTRALIA PTY LTD [2019] WASC 461

CORAM : CURTHOYS J

HEARD : 25 JUNE 2019

DELIVERED : 23 DECEMBER 2019

FILE NO/S : GDA 18 of 2018

BETWEEN :  480  HAY STREET PTY LTD

Appellant

AND

UBER AUSTRALIA PTY LTD

Respondent

Jurisdiction : STATE ADMINISTRATIVE TRIBUNAL

Coram : SESSIONAL MEMBER K BALES

File Number : CC 2431 of 2018

Leave - Retail shop - Listing on stock exchange - Act ceasing to apply due to change of circumstances

Legislation:

Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA)
Commercial Tenancy (Retail Shops) Agreements Regulations 1985

Result:

Appeal allowed

Category: B

Representation:

Counsel:

Solicitors:

Case(s) referred to in decision(s):

CURTHOYS J:

1. On 30 April 2018,  480  Hay Street Pty Ltd, as lessor, and Uber Australia Pty Ltd, as lessee, executed a 'retail shop lease', within the meaning of that expression in the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA) (the Act), in relation to tenancies 6 and 7 at  480  Hay Street, Perth (the Lease).
2. Clause 3.1 of the Lease provided that the Lease was for the term specified in item 5 of sch 1. Item 5 of sch 1 specified a period of five years from the commencement date.
3. The Lease commenced on 27 April 2018.
4. Clause 4.1 of sch 2 of the Lease provided that:

Either party may terminate this Lease, with respect to all or any portion of the Premises, effective from the third anniversary of the Commencement Date, by giving the other party no less than 6 months prior written notice.

5. On 1 November 2018,  480  Hay Street applied to the State Administrative Tribunal (SAT) pursuant to s 13(7) of the Act for approval of cl 4.1 of sch 2.
6. On 14 November 2018 the SAT refused  480  Hay Street's application on the following grounds:

(a) The Tribunal finds that the effect of the contractual conditions and the documentation filed with the application is to create a lease for a term of 3 years with the contractual conditions relating to a subsequent holding over period; and

(b) The Tribunal concludes that the application by the landlord under s 13(7) of the Act seeks to nullify the impact of the provisions of s 13(1) of the Act on those conditions, which are nevertheless void under the provisions of s 15 of the Act.

7. On 4 December 2018,  480  Hay Street lodged this appeal pursuant to s 105 of the State Administrative Tribunal Act 2004 (WA) (the SAT Act).
8. I note that Uber Australia did not appear. Accordingly, there was no contradictor.

9. The question of leave to appeal needs to be determined at the hearing of this appeal.
10. Relevant considerations as to whether leave ought to be granted include:

(a) the importance of the question of law;

(b) the merit of the arguments to be put on the question of law;

(c) whether  480  Hay Street would suffer a substantial injustice if leave is not granted because an error of law would remain uncorrected.

1. The Tribunal erred in law in:

1.1 Finding that the Lease was for a period of only 3 years and thus contrary to s 13(1) of the Commercial Tenancy (Retail Shops) Agreements Act 1985 (the Act); and,

1.2 Failing to consider whether, for the purposes of s 13(7) of the Act, special circumstances exist such as to justify approval of special condition 4 of schedule 2 of the Lease.

2. The Tribunal ought to have found that:

2.1 The Lease was for five years with provision for early determination; and

2.2 Special circumstances exist such as to justify approval of special condition 4 of schedule 2 of the Lease.

11. Section 3 of the Act defines 'retail shop lease' as meaning a lease that provides for the occupation of the retail shop, unless:

(c) the lease is held by -

(i) a body corporate whose securities are listed on a stock exchange, outside Australia and the external territories, that is a member of the World Federation of Exchanges; or

(ii) a subsidiary (within the meaning of the Corporations Act 2001 (Commonwealth) Section 9) of such a body corporate.

12. Regulation 3AB of the Commercial Tenancy (Retail Shops) Agreements Regulations 1985 (the Regulations) provides that the following leases are exempt from the operation of the Act:

(a) a lease held by a body corporate whose securities listed are on a stock exchange outside of Australia and the external territories that is not otherwise exempt under the Act;

(b) a lease held by a subsidiary (as defined in the Corporations Act 2001 (Commonwealth) section 9) of such a body corporate;

13. Uber Australia Pty Ltd is an Australian Propriety Company and is a subsidiary of Uber Technologies Inc of 1455 Market Street, San Francisco in the United States of America.
14. Shares in Uber Technologies Inc began trading on the New York Stock Exchange on 10 May 2019.
15. The New York Stock Exchange is not a member of the World Federation of Exchanges. Hence, s 3(c) of the Act does not apply.
16. Uber Technologies is a body corporate whose securities are listed on a stock exchange outside Australia, namely the New York Stock Exchange. Hence, reg 3AB of the Regulations applies.

17. On 10 May 2019, subsequent to the Tribunal's decision of 14 November 2018, Uber Technologies Inc was listed as trading on the New York Stock Exchange.
18. The evidence of the lessee's incorporation was contained in an affidavit of Hugh Mark O'Sullivan sworn on 12 June 2019.
19. I admitted that affidavit as fresh evidence.

20. In Towercom Pty Ltd v Strathfield Group Ltd,[1] which dealt with the exclusion from the ambit of the Victorian Retail Tenancies Act 1986 of any lease held by a publicly listed corporation, Stathfield Group Ltd converted from being a proprietary company to become a public company during the term of the lease. The court found that:

I am of the opinion that premises leased as 'retail premises' can cease to be 'retail premises' during the term of the lease if any of the disqualifying characteristics specified in section 3(1)(a), (b), (c), (d) or (e) occur. The converse may create a 'retail premises lease' for the purposes of the Act. Premises under the terms of a lease may become 'retail premises' because the disqualifying characteristics specified no longer disqualify the premises and the tenant from the protection afforded by the Act.

21. I am satisfied that, by reason of the listing of Uber Technologies Inc on the New York Stock Exchange, the Act no longer applies to the Lease. As in Towercom the premises ceased to be subject to the Act due to a change in circumstances, ie the listing on the New York Stock Exchange.
22. Although no formal application was made to amend the grounds of appeal, I have treated the fresh evidence as, in effect, an application to add an additional ground of appeal. That ground of appeal being:
    3. The Act does not apply to the Lease by reason of the operation of Regulation 3AB of the Commercial Tenancy (Retail Shops) Agreements Regulations 1985 consequent upon the listing of Uber Technologies Inc of which Uber Australia Pty Ltd, the lessee, is a wholly owned subsidiary, on the New York Stock Exchange.

23. There is merit on the question of law, namely, whether the Act continues to apply,  480  Hay Street would suffer a substantial injustice if a decision is not set aside in that the Act no longer applies. I am satisfied that leave should be granted.
24. I allow the appeal on ground 3.
25. By reason of the addition of ground appeal 3, it is unnecessary to deal with grounds 1 and 2.

26. Leave to appeal is granted.
27. The appeal is allowed.
28. The decision of the learned member is set aside.
29. The court declares that:
    3. The Act does not apply to the Lease by reason of the operation of Regulation 3AB of the Commercial Tenancy (Retail Shops) Agreements Regulations 1985 consequent upon the listing of Uber Technologies Inc of which Uber Australia Pty Ltd, the lessee, is a wholly owned subsidiary, on the New York Stock Exchange.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.

MDM
Associate to the Honourable Justice Curthoys

23 DECEMBER 2019

[1] Towercom Pty Ltd v Strathfield Group Ltd [2000] VSC 370.