SMALL BUSINESS: RETAIL LEASES

27 July 2010 COUNCIL

Mr KAVANAGH (Western Victoria) -- My adjournment matter is for the Minister for Small Business, Joe Helper, and relates to the laws that govern leases in shopping centres. I was recently visited in my electorate office by a former lessor of retail premises in a Geelong shopping centre. This businessman in effect had his business and livelihood destroyed by the power of the shopping centre where he had previously leased premises. I use the word 'power' advisedly because there is usually, and there was in this case, a gross power imbalance between the lessors and the lessees in shopping centres.

The businessman and the shopping centre both knew he was being treated unfairly and in a way that constituted a civil wrong. The businessman sued and won an award of damages, which both parties fully expected.

The problem is that Victoria's legislation makes it very difficult to obtain an order for costs even if you are initiating unsuccessful litigation. This deficiency in the laws and regulations has contributed, in the opinion of this businessman, to a decision by the shopping centre to appeal. Even if the shopping centre loses, the businessman's net proceeds are likely to almost disappear through his having to bear his own costs.

The action I am seeking from the minister is for him to review the present legislation and regulations that govern shopping centre leases in Victoria with a view to alleviating the power imbalance between shopping centre lessors and lessees. Specifically I ask the minister to consider possible amendments to relevant legislation and regulations which would allow courts to award costs against unsuccessful litigants where it would be just to do so and thereby prevent the use of raw monetary power in ways that are inconsistent with the attainment of justice.