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Court Finds Melbourne Shopping Centre Owner Guilty of Unconscionable, Misleading and Deceptive Conduct
ACCC v Dukemaster Pty Ltd [2009] FCA 682
Background
The ACCC brought proceedings against the owner of "the Paramount Centre" in Melbourne's Bourke Street in relation to alleged breaches of the Trade Practices Act 1974 (TPA). The allegations primarily related to the owner (and its General Manager, Ms Wong) engaging in unconscionable, misleading and deceptive conduct throughout its dealings with four tenants who leased premises within the food court in the centre.Decision At Trial
The court found in favour of the ACCC and held that the owner engaged in unconscionable, misleading and deceptive conduct, breaching sections 51AC, 52 and 53(e) of the TPA. The Owner's conduct that contributed to the decision of the court included:- representing to tenants that it believed rent was "very reasonable and below market value" when this was not the case and the owner did not have a reasonable basis for this belief;
- taking advantage of tenants who had a limited ability to read and speak English (and the owner's knowledge of this);
- imposing unreasonably short periods of time for tenants to respond to proposed rents when negotiating new leases;
- threatening to evict tenants and sending tenants letters of demand without justification; and
- non-compliance with Victorian retail leases legislation including failure to tell a tenant whether it would grant a new lease to the tenant at least 6 months before the expiry date of the existing lease.
Why The Decision Is Important
This decision gives both industry stakeholders and shopping centre lawyers some clear examples of the types of conduct by an owner that is to be considered unconscionable, misleading or deceptive when negotiating a lease renewal with a sitting tenant.For more information on this topic, please contact Cameron Graham.