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Wednesday, 3 October 1984
Page: 1573

(Question No. 1616)

Mr Ruddock asked the Minister for Territories and Local Government, upon notice , on 21 August 1984:

(1) What penalty did the Canberra Commercial Development Authority sub-lease with Myer (NSW) Ltd, dated 7 April 1983, provide for late payment of rent.

(2) In what clause of the sub-lease was this provision made and what were its terms.

(3) Did the clause prescribe that the penalty would apply from the commencement of the sub-lease, namely 16 October 1978.

(4) What sub-lease terms were in dispute so as to delay general agreement on the leasing arrangements.

Mr Uren —The answer to the honourable member's question is as follows:

(1), (2) and (3) Clause 12 (c) of the Myer sub-lease reads-'Without prejudice to the rights powers and remedies of the Lessor otherwise under this lease the Lessee shall pay to the Lessor interest at the rate of 12% per annum on any moneys due but unpaid for fourteen (14) days by the Lessee to the Lessor on any account whatsoever pursuant to this lease such interest to be computed from the due date for the payment of the moneys in respect of which the interest is chargeable until payment of such moneys in full and to be recoverable in like manner as rent in arrears.'

(4) The sub-lease terms in dispute were:

(a) Waiver by the lessor's insurers of its rights of subrogation.

(b) Exception of lessee's negligence from an indemnity document.

(c) Inclusion of licensee sales for the purpose of percentage rent.

As background, I am informed that a document was prepared on 26 September 1978 which was thought to be the final engrossment of the agreement to lease.

On 3, 4 and 5 October 1978, there were further discussions arising out of the document which left the above lease terms to be resolved. These particular lease terms were, by and large, of a minor nature.

Around 14 October 1978 the lessee raised an entirely new matter relating to the interpretation in the agreement of the cut-in point for gross sales following updating of base rent.

This provision has been drafted by the lessee. The lessee alleged that this provision did not reflect the true agreement between the parties.

This was a major matter which required lengthy negotiations before a final agreement could be reached.