08/03/2005 - 21:00

Galleria food fight moves to court

08/03/2005 - 21:00

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Two small business owners are taking on one of the world’s largest property players in court over what they allege is a breach of contract relating to their tenancies in the Galleria shopping centre’s upstairs food court.

Galleria food fight moves to court

Two small business owners are taking on one of the world’s largest property players in court over what they allege is a breach of contract relating to their tenancies in the Galleria shopping centre’s upstairs food court.

Court documents show the main plaintiffs in the action are Pedra Holdings Pty Ltd, which traded as the Johnny Rockets hamburger bar, and Myran Holdings Pty Ltd, which trades as Fresh and Tasty.

The two main defendants in the action are entities linked to former Galleria owner Westfield and current owner Centro.

Pedra Holdings is seeking about $730,000 while Myran Holdings and its directors Henry and Marianne Aveling are seeking $351,000.

It is understood Centro is trying to have the action moved from the Federal Magistrates Court to the more expensive Federal Court.

Commercial disputes lawyer Alan Rumsley, who is representing the plaintiffs, said the action was mainly against former Galleria owner Westfield but also included current owner Centro and agents related to those companies.

He said the crux of the claim related to Westfield’s placing competing food businesses on the ground floor of the centre and also in the centre’s carpark, something the plaintiffs allege is a breach of their lease agreement.

One of those competing businesses is a cafe called Jamaica Blue, which has been set up at the base of the escalators leading to the upstairs Galleria foodcourt.

According to the plaintiffs’ statement of claim, Jamaica Blue’s position coincided with a decrease in their trade.

A Westfield spokesman said the company was defending the plaintiff’s allegations.

“In fact, Westfield has applied for a strike-out motion. That is, we believe the allegations have no merit,” he said.

“It is my understanding these allegations relate to alleged representations made by Coles Myer Properties in 1994 – two years before Westfield owned or managed the centre.”

Mr Rumsley said Centro’s lawyers had argued that the value of claims from the plaintiffs would take them beyond the $200,000 maximum allowed in the Federal Magistrate’s Court, and therefore the action should be moved to the Federal Court.

He said it was about five times more expensive to pursue an action in the Federal Court than in the Federal Magistrates Court.

“While there is a limit of $200,000 for general damages, there is no limit for breach of contract or for the court ordering repayments,” Mr Rumsley said.

“They basically say if they can’t have damages then they want their rent repaid.”

The damages the plaintiffs are seeking relate to alleged losses they have made.

Centro state manager Peter Pike said he would prefer not to comment because the matter was before the courts.

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