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Needlegrove case
Tiernan Lawyers acted for Provident Capital Limited (Provident), the 3rd Defendant and the successful party. Provident was the mortgagee and had provided funds to the Plaintiff Needlegrove Investments for the purpose of renovating leased premises located at Brighton Novatel Hotel. Needlegrove leased a restaurant/entertainment venue from Thakral, the owner of the Novatel Brighton Hotel.
During 2005, the landlord purported to terminate Needlegrove's lease of the premises for non-payment of rent amongst other reasons. Needlegrove commenced proceedings against the landlord seeking relief from forfeiture of the lease. Provident's security for the loan was the lease, so Provident was determined to save the lease from termination. Provident and Tiernan Lawyers were able to identify a legal error in the landlord's methodology in terminating the lease. The landlord failed to inform Provident that it was the landlord's intention to terminate the lease for Needlegroves defaults, as they were required to do under the terms of a Deed of Consent to Mortgage of Lease. The landlord's solicitors did not believe that the landlord must inform the mortgagee of their intention to terminate. The landlord and their solicitors were wrong. After 12 days of hearing in the Supreme Court of New South Wales, the Court found that Provident's submissions were correct and the Court ordered that the purported termination was invalid and ordered the landlord to pay the Lessee's costs and Provident's costs.
Callaghan case
Tiernan Lawyers acted for a humble pub tenant against an owner of many pubs in the Sydney CBD.
Mr Callaghan was the Director of Pub Oz Pty Limited, which was the Lessee of the Wynyard Hotel. During Pub Oz's tenancy of the Wynyard Hotel, the Hotel was purchased by Merivale Pty Limited, a company operated by the Hemmes family. The new owner of the Pub was unhappy with the amount of rent that the tenant was paying, so he purported to do a "market rent review" and substantially increased the rent in a manner that was inconsistent with the lease provisions. Mr Callaghan disputed the purported rent review but continued to pay the increased rent so he was not in default of the lease. Eventually, at the end of the lease, the strain of paying the increased rent resulted in Pub Oz suffering substantial trading losses and eventually contributed to forcing the Lessee company into liquidation. Mr Callaghan felt that he had been forced to pay an unfair rent, he sought legal advice. He purchased the cause of action from the Liquidator and personally took on a heavyweight corporate opponent, and won. The Court found that the purported "market rent review" was invalid. Mr Callaghan was awarded damages and costs for paying too much rent during the last years of his lease of the pub. The drinks were then on Mr Callaghan!
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