When can a landlord retain a tenant’s fixtures, fittings and goods at the end of a retail lease?

The decision of Cristiano v Prime Kwality Foods Pty Ltd (Building and Property) [2025] VCAT 580 provides some helpful discussion on the tort of conversion in the context of a landlord retaining a tenant’s fixtures, fittings and goods at the premises at the end of a retail lease.

The decision is available at: https://lnkd.in/gCjVENX2

The headlines are:

1. A landlord must provide a tenant with a proper opportunity to remove fixtures, fittings or goods from premises at the end of a retail lease. If the landlord fails to do so, it may not be able to rely upon (a) lease terms requiring the tenant to remove its fixtures, fittings or goods from the premises before returning them to the landlord; nor upon (b) the provisions relating to uncollected goods in Part 4.2 of the Australian Consumer Law and Fair Trading Act 2012 (Vic) (at [51]-[61]).

   
   

2. Such a failure by the landlord may not only disentitle it from recovering from the tenant the cost of disposing of such fixtures, fittings or goods, or otherwise ‘making good’ premises—it can expose the landlord to liability under the tort of conversion, as happened to the landlord in this case.

   
   

3. In Victorian law, merely acting in a manner inconsistent with another party’s entitlement to goods may constitute conversion, even without a demand for the return of those goods (see [70]-[73]).

   
   

4. The measure of damages for conversion is ordinarily the value of the goods converted at the date of conversion, together with any proven consequential loss (at [110]). The practical implication of this is that if perishable goods such as foodstuffs are converted, and later expire, their value is assessed as of the date of conversion, when they are presumably still worth something.

   
   

5. Landlords cannot disclaim statements by their managing agents when they have clothed the managing agent with authority to communicate on their behalf with the tenant (at [76]).

   
   

6. The presiding senior member noted the substantial delay between the receipt of final submissions and the publication of the Tribunal’s determination, which was attributed to heavy caseloads in the Building and Property List (at [13]). Practitioners contemplating any proceedings in that list seeking final relief should be aware of these potential delays.

   
   

Graham Fountain, solicitor at Fountain Law appeared for the landlords/applicants. Luke Virgona, of counsel, appeared for the tenants/respondents.