Exceed Education Pty Ltd t/as Young Minds Academy v Sylvester

Stated at a very high level, these proceedings involve a contention by the plaintiff (Exceed Education) that the defendant (Ms Sylvester) who is Exceed Education’s landlord, is unreasonably withholding her consent to an assignment of the Lease (as defined below).

Exceed Education operates a childcare business from the Property (as defined below) having bought that business in July 2022 from a related company of Ms Sylvester at about the same time that the Lease was entered into.

One hundred and fifty thousand dollars of the purchase price was held back and is payable in the event Ms Sylvester arranges a successful Development Application (DA) to increase the numbers for the childcare centre permitted to be operated from the Property to 38.

Exceed Education now wishes to sell the business and has entered into a contract to do so, and has sought Ms Sylvester’s consent to a transfer of the Lease.

A number of grounds now appear to be relied upon by Ms Sylvester as providing a basis for her not providing her consent. They include Exceed Education’s refusal to agree to pay rent which Ms Sylvester contends is owing, and to pay the $150,000 into a trust account pending completion of the works required under the DA.

The proceedings were commenced on 19 September 2025 and have been brought on urgently in circumstances where the business sale contract from Exceed Education to the purchaser was meant to settle on 22 September 2025, and the purchaser has served a notice to complete dated 29 September 2025, requiring completion by 13 October 2025.

The proceedings were originally listed on a two hour estimate on the morning of 2 October 2025. On the day before the hearing, my Associate was advised that the parties thought that the hearing would last a whole day, and that cross-examination was required. Even that estimate proved ambitious and the hearing was not able to be completed within one day. It was necessary for the parties to provide detailed written submissions and reply submissions after the conclusion of the evidence.

In the circumstances, and in particular the urgency with which the Court is asked to determine the dispute, in what follows I have sought to focus on what I regard as the critical or essential issues for decision, given the present dispute.

Mr P Folino-Gallo appeared for Exceed Education and Mr G Kassisieh appeared for Ms Sylvester.

For the reasons set out below, I have determined that Ms Sylvester has unreasonably withheld her consent to the transfer of the Lease and that Exceed Education is entitled to orders in the nature of specific performance conditional on Exceed Education paying to Ms Sylvester, either prior to or on completion of the transfer, the outstanding rent I have determined to be owing of $19,060.76. I will give the parties an opportunity to agree costs, failing which I will determine any remaining issues on the papers.

Two witnesses made affidavits and were cross-examined.

First, for Exceed Education, its director, Ms Erenie (Irene) Sawiers (Ms Sawiers) made two affidavits and was cross-examined. There was no serious challenge to much of her evidence, save for whether any agreement was actually reached between Ms Sawiers and Ms Sylvester regarding who was to pay for certain repairs.

Second, Ms Sylvester – the defendant – made an affidavit and was cross-examined. I was advised by her counsel as Ms Sylvester entered the witness box, that she was hearing impaired and lip read as well as used a hearing aid. It became apparent to me on several occasions during the cross-examination that Ms Sylvester was having real difficulty either hearing the question or understanding what it was she was being asked. A number of her answers were contradictory.

None of this counts against Mr Sylvester’s credit – I formed the opinion that she was giving her evidence honestly and in an attempt to assist the Court. It does, however, cause me to approach with caution any concessions which Ms Sylvester is said to have made in the witness box.

By contract dated 11 July 2022, Exceed Education purchased the Mirrabooka Early Childhood Centre from a company controlled by Ms Sylvester (Mirrabooka Early Childhood Centre Pty Ltd) for the sum of $675,000. That business was being, and has since 2009, been, conducted from X Hillcrest Road, Mirrabooka (the Property) which is owned by Ms Sylvester in her own name.

There are two main buildings located on the Property. The childcare centre is run out of the ground floor of the front two-storey building and the back building.

The Property has three outdoor play areas, a car park, three sheds and footpaths. Of the three playground areas, the small (nursery) playground area is 72 square metres, the middle playground area is 92 square metres and the back outdoor playground area is 146 square metres. The total size of the land is 1,277 square metres.

On 1 August 2022, Exceed Education entered into a lease of the Property with Ms Sylvester (Lease). One of the special conditions to the business sale contract required Exceed Education to enter into the Lease. The Lease is for a head term of 10 years with two 10 year options.

The Lease explicitly indicated that the initial rent amount would be calculated by reference to 34 childcare places. It also provided that the first month would be free. It did not appear to be in dispute that at the time of the Lease, the childcare centre was only licenced for 20 children.

On 1 August 2022, a Deed of Variation of the Business Sale Contract (Deed of Variation) was entered into, varying the business sale contract by the addition of a further condition numbered 17, the effect of which was to hold back $150,000 of the purchase price pending Ms Sylvester arranging a successful DA to increase numbers for the centre to 38 (or a number agreed between the parties going forward). The $150,000 was to be paid within seven days of Ms Sylvester providing the DA to Exceed Education.

The Deed of Variation also provided for a new special condition 18, which provided for the rent to be calculated by a factor of 38, rather than 34 places on the successful DA.

No amendments were made to the Lease consistent with the Deed of Variation.

At all times since about August 2022, Exceed Education has conducted a childcare business from the Property under the business name “Young Minds Academy”.

In September 2023, Ms Sylvester submitted a DA to Lake Macquarie City Council (Council).

It appears that between November 2023 and April 2024, the Property was affected by weather events which resulted in damage to the Property. Exceed Education contends that the damage was due to poor drainage design. Exceed Education lodged a claim with its insurer which was rejected. Ms Sylvester lodged a claim with her insurer which was partly successful and an amount of about $26,000 was paid by the insurer to Ms Sylvester.

On 30 September 2024, lawyers for Exceed Education wrote to Ms Sylvester contending that Ms Sylvester was in breach of clause 7.1 of the Lease by not commencing work to carry out the repairs to repair the damage. The letter also put Ms Sylvester on notice of a claim by Exceed Education of overpayment of rent from November 2023.

On or about 24 September 2024, the NSW Department of Education inspected the Property and issued a notice of non-compliance for the Property, detailing several breaches including retaining wall and drainage issues. The notice stated:

On 30 September 2024, Ms Sylvester wrote to a plumbing contractor, Marshal Plumbing seeking a quote for certain storm water drainage works. Ms Sylvester was cross-examined to suggest that the work that was being quoted on had to do with fixing the storm water drainage, having regard to the previous water ingress issues. The contemporaneous email communication on 1 October 2024 suggests, as Ms Sylvester suggested, in cross-examination, that the work was related to the amended DA plans which were then before Council. The Department of Education notice suggests, in any event, that the issue of repairs was related to the development approval.

On 20 March 2025, development approval was obtained, subject to conditions, which included the carrying out of certain works. Once these works are completed, condition 34 of the development approval will achieve the objective of approving a capacity at the childcare centre of 38 places.

Notice of the development approval was subsequently given by Ms Sylvester to Exceed Education.

On 4 June 2025, Exceed Education’s lawyers sent a further letter to Ms Sylvester referring to both the notice of non-compliance and the 30 September 2024 letter. The letter contended that it was Ms Sylvester’s obligation to carry out the repairs set out in that letter. The letter further stated that Exceed Education had withheld, and would continue to withhold, rent due to the lack of repairs – see clause 8.2 of the Lease. Exceed Education sought Ms Sylvester’s consent for it to carry out the repairs.

A response was received from solicitors for Ms Sylvester on 6 June 2025. The response stated that Ms Sylvester disputed much of what was claimed, and preferred to work towards a resolution rather than litigate via correspondence. The letter requested release of the $150,000 held back so as to provide the funds for Ms Sylvester to carry out the works. It was contended that Exceed Education was in breach of its obligations. An offer was made for Exceed Education to immediately release $75,000 with the balance payable at call.

On that same day, there were email communications between Ms Sawiers, the director of Exceed Education, and Mr Paul Wrigley, the managing agent in respect of the Property in relation to certain work to be carried out to the retaining wall at the Property. Ms Sylvester, through her husband to Mr Wrigley, gave approval for work to commence on the retaining wall, as per a quotation that had been received.

A response to the 6 June 2025 letter from Ms Sylvester’s lawyers, was provided from Exceed Education’s lawyers on 13 June 2025, contending that Ms Sylvester had not yet complied with her obligations in relation to the Deed of Variation. It was contended that no occupation certificate had yet been issued permitting a 38 place childcare centre, in which case the $150,000 was not presently owing. Exceed Education offered to release the $150,000 once the works required under the DA had been carried out, the repairs had been carried out and an occupation certificate had been issued.

In early July 2025, Ms Sawiers sent a text message to Ms Sylvester’s husband alerting him to a potential sale of the business.

On 29 July 2025, Exceed Education entered into an agreement with GAD Group Co Pty Ltd (GAD Group) for the sale of the business “Young Minds Academy – Mirrabooka” for $1.2 million. The settlement date under the contract for sale is 22 September 2025.

Condition 12 in the additional provisions of the contract makes it conditional on the transfer of the Lease.

On 22 August 2025, Exceed Education sent an email to Ms Sylvester providing the “PA 09 Transferring Provider Declaration (Service Approval) Form”.

A further letter was then sent by Exceed Education’s lawyers to Ms Sylvester dated 29 August 2025. It would appear that this letter was preceded by a without prejudice letter in which Ms Sylvester sought a copy of the contract for sale of business between Exceed Education and GAD Group.

The letter sought Ms Sylvester’s consent to the transfer of the Lease to GAD Group Co Pty Ltd.

The letter relevantly stated:

The documents attached to the letter included a current company search for GAD Group which revealed that it was registered on 11 July 2023. The financial statements included a balance sheet showing total assets of $987,313.37, of which the main asset was goodwill of $800,000. The total liabilities were $538,245.24, including a business loan of $435,835.09. The profit and loss statement stated that the net profit for the period 1 July 2024 to 30 June 2025 was $258,355.82.

Although the covering letter said that trade references were provided, none were in fact provided. What was provided was a one page statement about the director of GAD Group, Mr Joseph Gad (Mr Gad). The one page document stated, among other things, that Mr Gad formally entered the childcare sector in 2024 and became an approved provider in NSW on 30 January 2024 and acquired his first childcare centre in Croydon Park on 19 June 2024. The statement also revealed that he was currently completing a graduate diploma in early childhood education and has completed 63% of the course. It also stated that the Croydon Park centre underwent an Assessment and Rating with the NSW Department of Education in December 2024 and was rated as meeting the National Quality Standard in all seven Quality Areas.

On 5 September 2025, the parties’ lawyers exchanged correspondence. A letter from Exceed Education’s lawyers dated 5 September 2025 asserted that Ms Sylvester was delaying and withholding her consent. The letter then made the following open offer:

The letter also stated that:

Finally, the letter asserted that under clause 10.1 of the Lease, Ms Sylvester’s consent to transfer the Lease cannot be unreasonably withheld and that she had been provided with all the information reasonably required to provide her consent and she had not done so. Consent was sought within three business days, failing which they were instructed to commence proceedings without further notice.

Also on 5 September 2025, new solicitors for Ms Sylvester sent a letter, wrongly dated 4 September 2025, in response to the letter dated 29 August 2025 to the following effect:

On 8 September 2025, Exceed Education’s lawyers provided a response to the 5 September 2025 letter from Ms Sylvester’s lawyers.

The letter provided as follows:

A response was then provided by Ms Sylvester’s lawyers on 11 September 2025 (by email wrongly dated 9 September 2025) in the following terms:

On 27 August 2025, Exceed Education was advised by the property manager – Ray White Toronto – that the total amount of rent which had been withheld by Exceed Education was $79,205.88.

No substantive correspondence was received from Exceed Education prior to the commencement of proceedings on 19 September 2025.

A further letter was sent by Ms Sylvester’s lawyers to Exceed Education’s lawyers dated 18 September 2025 reiterating the three conditions set out in the 5 September 2025 letter. That letter concluded with a contention that Ms Sylvester is “ready, willing and able to assign the lease once the above conditions are met.”

On 4 September 2025, Exceed Education paid further rent of $11,532.24 and on 22 September 2025, a further $1,749.52 was paid.

It also appears that in late 2024, Ms Sylvester called on a bank guarantee which had previously been provided by Exceed Education, in the sum of $18,700.

To complete the factual picture, it also appears that Exceed Education has paid $43,000 to replace the synthetic grass at the Property and an amount of $6,050 for repairs to the retaining wall. There was some dispute on the evidence as to whether Ms Sylvester had been provided with proof of payment by Exceed Education of these sums. It does not appear that prior to the commencement of these proceedings, any proof of payment was in fact provided, but I am satisfied on Ms Sawiers’ evidence that the amounts have been paid by Exceed Education.

Ms Sylvester placed some reliance on the terms of the business sale contract between Exceed Education and GAD Group. It appears to be common ground that Ms Sylvester was not aware of the terms of the contract because although it appears that she asked for a copy, she was told by Exceed Education’s lawyers in the letter dated 29 August 2025 that its terms were not relevant to the consent issue. Ms Sylvester’s lawyers did not see a copy of the business sale contract until these proceedings. The contract reveals that, as part of the sale, Exceed Education was granting GAD Group a four-year fixed term loan at 5%, to repay $500,000 of the agreed $1.2 million purchase price for the business. The relevance of this condition was as to the impact on the financial statements of GAD Group which were provided under cover of the letter of 29 August 2025 which in turn went to whether Exceed Education had satisfied clause 10.2.2 of the Lease and whether Ms Sylvester was unreasonably withholding consent.

Of central relevance to the issues for determination are the provisions of clause 10.1 to 10.5 of the Lease. They provide:

By clause 5.1.4 of the Lease, the lessee must also pay:

Reliance was also placed on the provisions of s 133B of the Conveyancing Act 1919 (NSW) (CA). That provision does not add much to the issues that arise in relation to consent under the provisions of the Lease.

As set out above, the proceedings were commenced on an urgent basis on 19 September 2025. They were commenced by summons seeking relief, in effect, declaring that Ms Sylvester had unreasonably withheld her consent to the transfer of the Lease and orders in the nature of specific performance to compel consent.

During the course of counsels’ opening address at the hearing on 2 October 2025, I sought to obtain some clarity as to the issues that the Court was required to determine.

Having regard to the parties’ closing submissions – both oral and written – the parties appear to have agreed that the following issues arise for determination by the Court:

I consider each of the issues in turn.

Ms Sylvester contended that the answer is no because clause 10.3 of the Lease provides that Exceed Education must provide Ms Sylvester with such information as Ms Sylvester may reasonably require concerning the financial resources of the proposed transferee and Exceed Education failed to do so in that it failed to provide to Ms Sylvester the sale contract between Exceed Education and GAD Group. Relatedly, it is said that Exceed Education failed to provide Ms Sylvester with the contact details for GAD Group’s legal advisors which was separately requested on 11 September 2025 but never provided.

Exceed Education contended that it had complied with its obligations under clause 10.3 in the attachments to the 29 August 2025 letter.

I am satisfied that Exceed Education has complied with its obligations under clause 10.3 and reject Ms Sylvester’s contentions to the contrary. I have set out clause 10.3 above.

The 29 August 2025 letter attached:

The response to this letter from Ms Sylvester’s lawyers was a conditional approval to the transfer. Nothing was said to the effect that Ms Sylvester required more information concerning the financial resources of GAD Group. Had more information been required, one would expect it to have been requested.

I regard this contemporaneous exchange as the most reliable evidence of what was required. Absent information in fact being required – in the sense of requested – by the landlord, no issue under clause 10.3 arises.

I am prepared to infer that some sort of request was made prior to 29 August 2025 for the sale contract between Exceed Education and GAD Group to be provided by Exceed Education to Ms Sylvester. The nature of the request is a little unclear as it appears to have been made as part of a without prejudice communication. The response was clear in the 29 August 2025 letter, namely that the contract was not relevant. This was taken no further by Ms Sylvester. Again, I regard this as the most reliable evidence of what was required at the time. Exceed Education was justified in proceeding on the basis that the sale contract was not in fact required by Ms Sylvester.

I also do not accept the contention now made by Ms Sylvester that she was left with an incomplete impression of GAD Group’s financial resources by reason of the failure to provide the sale contract. Whilst it is true that the sale contract would have revealed that vendor finance of $500,000 was being provided which would have been recorded in GAD Group’s accounts, the finance was being used to purchase an asset for $1.2 million, which would also have been recorded in the accounts. There was no suggestion that the price being paid was not market value.

I also do not accept the contention that the sale contract would have revealed GAD Group’s lawyer’s details, coupled with the failure to respond to the subsequent direct requests, as meaning that clause 10.3 was not satisfied. Had Ms Sylvester required direct contact with GAD Group’s lawyers or GAD Group itself to check its financial resources, that could have been requested. There was no such request. The 11 September 2025 request for the contact details of GAD Group’s lawyers was not in the context of checking GAD Group’s financial resources but rather documenting an amendment to the Lease.

The underlying legal principles are clear.

In Tamsco Ltd v Franklins Ltd [2001] NSWSC 1205; (2001) 10 BPR 19,077 (Tamsco), Young CJ in Eq stated at [49]:

In Cathedral Place Pty Ltd v Hyatt of Australia Limited [2003] VSC 385, Nettle J stated at [27]:

More recently, in Construction Technologies Australia Pty Ltd v Doueihi (No 5) [2018] NSWSC 294, Kunc J stated at [64]-[67]:

In the context of collateral advantage, Young CJ in Eq stated in Tamsco at [53] to [55]:

Three bases appear to be relied on by Ms Sylvester for refusing consent. It is for Exceed Education to prove that each is unreasonable. The three bases are:

I consider each in turn.

It is convenient to deal with these matters in reverse order.

Ms Sylvester places reliance on clause 10.2.2 which requires Exceed Education, before any transfer, to prove to Ms Sylvester’s reasonable satisfaction that GAD Group is respectable and has financial resources sufficient to satisfy the lessee’s obligations under the Lease.

So the argument goes, if this has not been proven, it is not unreasonable for Ms Sylvester to withhold her consent.

Exceed Education urged, as I understood its closing submissions, a broader inquiry whereby satisfaction or not of clause 10.1.1 and 10.1.2 of the Lease is relevant, but is not determinative. The totality of the circumstances must be considered. Reference in this regard was made to what Young CJ in Eq said at [49] in Tamsco extracted above.

I am not satisfied that it is reasonable for Ms Sylvester to withhold consent to transfer of the Lease on the grounds that she is not satisfied that GAD Group is respectable and has financial resources sufficient to satisfy GAD Group’s obligations under the Lease. I am satisfied that Exceed Education has proven to Ms Sylvester’s reasonable satisfaction that it is.

I approach the question in a practical and realistic manner and not from the stated point of a “pedantic chartered accountant”: see Re Greater London Properties Ltd’s Lease (1959) 1 WLR 503 at 507.

The starting point is that no issue of respectability or lack of financial resources was raised by Ms Sylvester after the provision of the material with the 29 August 2025 letter. I regard this as the most reliable evidence.

I do not regard the evidence now given by Ms Sylvester of the concerns that she apparently had at the time of reviewing the material attached to the 29 August 2025 letter as being overly relevant. Whatever her concerns then were, they were not sufficient for her to refuse to consent. She must have been satisfied of the respectability and financial resources of the GAD Group. The material attached to the 29 August 2025 letter certainly provided a basis for her to be satisfied of both.

I do not accept that the matters raised in the Business Sale Contract between Exceed Education and GAD Group cast doubt on GAD Group’s financial resources necessary to satisfy its obligations under the Lease.

The material attached to the 29 August 2025 letter establishes that the GAD Group is an existing childcare provider which earnt a net profit of $258,335.82 in the financial year to 30 June 2025, which appears to be its first financial year of operation.

Whilst, as set out above, the Business Sale Contract reveals $500,000 of vendor finance is being provided which will be recorded in the accounts the asset being bought at a market value of $1.2 million will also be recorded. There was no suggestion in the evidence that the business being purchased was other than a profitable one. The concerns raised by Ms Sylvester in closing written submissions in this regard rose no higher than speculation inherent in the conduct of any business.

Further, the contention made by Ms Sylvester that GAD Group would be a financially risky and less experienced tenant than Exceed Education raises a false issue. The issue is not a comparative one requiring the incoming tenant to be as experienced and financially viable as the outgoing one.

I do not regard Ms Sylvester as acting reasonably in imposing, as a condition of her consent, that $150,000 be placed into a trust account and released once an occupation certificate is obtained. In imposing such a condition, Ms Sylvester is seeking to obtain a collateral advantage beyond that contemplated by the parties to the Lease.

I accept the contentions advanced by Ms Sylvester that there is a connection of sorts between the transaction pursuant to which the $150,000 is payable and the Lease which is the subject of the transfer consent request.

I do not regard that connection, however, as providing a sufficient basis for Ms Sylvester to seek to tie her consent to transfer to the provision of security under the varied terms of the Business Sale Agreement between Exceed Education and Ms Sylvester’s corporate entity.

The fact is the transactions are separate and are between different entities on the Sylvester side of the transaction.

Had Ms Sylvester wanted security in respect of the $150,000 agreed to be held back as part of the purchase price, she could have negotiated this at the time of the Deed of Variation. She obviously did not. I do not regard it as reasonable in these circumstances, for Ms Sylvester to seek to impose this requirement as a condition of transfer.

Further, the transfer of the Lease has no impact on the legal obligations in relation to the $150,000. The amount will become due and payable by Exceed Education once the terms of the relevant clause of the Deed of Variation have been satisfied. It did not appear to be in dispute that the $150,000 was not presently due and payable and would become due and payable once an occupation certificate had been issued, being the condition sought to be imposed by Ms Sylvester. There is no suggestion that the amount will not be paid if the condition is satisfied. If it is not paid, Ms Sylvester has her rights under the Deed of Variation.

The fact that Ms Sylvester has spent considerable money and effort on the development application process and has achieved conditional consent, does not make the security request a reasonable one. There is no suggestion that it was not anticipated at the time the Deed of Variation was entered into that considerable cost would be incurred in seeking development approval.

Further, the fact that Ms Sylvester’s company, as party to the Deed of Variation, may need to seek to enforce special condition 18 of the Deed of Variation if Exceed Education remained the tenant and refused to agree to amend the Lease to increase the rent payable to be based on 38 places, also does not make the security request a reasonable one.

I do not regard the observations of Young CJ in Tamsco at [53] (extracted above) as assisting Ms Sylvester. The question is case specific – asking whether the purpose is connected or wholly unconnected to the Lease is not seeking to introduce some bright line test. I do not read the decision as suggesting that any connection to the Lease is sufficient. The question is whether the refusal of consent is reasonable having regard to the terms of the contract between the parties. For the reasons set out above, I do not regard the introduction of a requirement for security as reasonable.

As set out above, one of the conditions that Ms Sylvester imposed in her 5 September 2025 letter was for Exceed Education to agree the amount of rent outstanding and agree to pay that outstanding rent on completion.

Whether this position was a reasonable one masked a number of other issues between the parties which gradually emerged during the course of the hearing and the closing written submissions. At times, the position of each party on these issues changed – particularly on the issue of whether the Court was required to determine, on the present application – whether any rent was owing and if so, what amount. The final position of both parties was that the Court was required to determine this issue, notwithstanding the unsatisfactory way that it was presented (which I say more about below).

The first issue raised between the parties appears to be one of construction – namely what is the effect of clause 10.2.1? Is it a matter to be satisfied by Exceed Education at the time of completion or does it bear on the reasonableness of the landlord withholding consent?

In light of the position ultimately reached by the parties that the Court is required to determine whether there is rent outstanding and in what amount, the construction issue does not have much significance. The position reached is that the parties are at odds as to whether there is rent owing. This is in circumstances where, as I understand Exceed Education’s position, if the Court determines that rent is outstanding it will pay that amount on completion and payment of the amount determined can be made a condition of the grant of specific performance.

Given this position, Exceed Education will never be in breach of clause 10.2.1 at the time of transfer – the relevant time stated in clause 10.2.1 – because it will pay any outstanding rent.

For completeness, I reject any contention advanced by Ms Sylvester that the proper construction of clause 10 as a whole is that a lessee who is in breach at the time consent to transfer is sought, can never make a valid request for consent to transfer, not at the time that consent is sought. That is not what clause 10.2.1 says. The clause seeks to impose an obligation to be satisfied by the lessee at the time of transfer. The position in this regard is similar to that considered by Bryson J in Spintar Pty Ltd v Ranieri Nominees Pty Ltd (Supreme Court (NSW), Bryson J, 1 February 1991, unrep) (BC9102412) at 9. That was, in substance, the approach taken by Ms Sylvester in her 5 September 2025 letter. She wanted the outstanding rent agreed prior to transfer and paid on completion. I would only add to that that if the rent has not been agreed between the parties, there is no reason why it could not be determined by the Court – the position the parties reached in this case.

That brings me to the question of whether there is rent outstanding and, if so, in what amount.

Before moving to the detail it is appropriate to say something brief as to the unsatisfactory way in which the issue was presented to the Court for determination.

The proceedings were commenced on 19 September 2025 by summons seeking declaratory relief in relation to the refusal to consent and associated orders in the nature of specific performance. An urgent final hearing was sought and granted, given the position of the GAD Group. An agreed estimate of 2 hours was provided.

On 29 September 2025 a further substantive affidavit was served from Ms Sawiers. Although expressed to be in reply to an affidavit of Ms Sylvester, the affidavit contained substantial evidence on the outstanding rent issue, being an issue on which Exceed Education bears the onus under clause 10.2.1. A number of objections were then taken to that evidence including on the grounds of late service and associated prejudice.

A complete hearing on the issue of the outstanding rent would likely have proceeded by way of pleadings so as to give some clarity to the issues raised – both factual and legal. The hearing would likely have taken longer than it did, both by way of evidence and submissions. None of this proved possible in view of the fact that a decision is required prior to the time of expiry of the notice to complete served by the GAD Group – 13 October 2025. Against this, however, the amount at issue between the parties is at most $50,000, which raises issues of proportionality. (I do not mean to suggest by this last observation that the amount at issue of $50,000 is not unimportant to the parties. It obviously is important.)

Having regard to the extremely limited time available, and in some respects the unsatisfactory state of the evidence, I now determine whether any rent is owing and in what amount, conscious of issues of proportionality given the amount at issue.

The starting point is that in the letter dated 30 September 2024, it was indicated that Exceed Education would withhold rent. This was repeated in the 4 June 2025 letter. This it did, paying no rent between November 2024 and August 2025. On 31 December 2024, Ms Sylvester cashed a bank guarantee provided by Exceed Education in the amount of $18,700 and credited it as rent paid by Exceed Education.

An amount of $11,532.24 was paid on 4 September 2025 and credited as rent in favour of Exceed Education. Another payment of $1,749.52 was made on 22 September 2025.

The first issue is whether it was proper for Exceed Education to withhold the rent that it did. The amount withheld was apparently in the order of $79,205.88. Exceed Education contends that it was entitled to withhold rent under cl 8.2 of the Lease. Under cl 8.2.1, if the property or the building of which it is a part is damaged, Exceed Education is not liable to pay rent that is attributable to any period during which the property cannot be used under the lease or is inaccessible due to that damage. Under cl 8.2.2, where the property is still useable but its useability is diminished due to the damage, the liability to pay rent is reduced proportionately.

For the most part, the evidence on this issue consisted of an exchange of correspondence between solicitors for the respective parties.

Importantly, there is no evidence that the entirety of the property was unusable for the entirety of the period that the rent was withheld. The correspondence from Exceed Education’s solicitors suggests some reduction in use, but no particular details are provided. Absent total inability to use, Exceed Education was not entitled to withhold the entirety of the monthly rent – which is what it sought to do for the entirety of the period from November 2024 up to and including August 2025. It was only entitled to a proportionate reduction. The evidence does not permit any assessment of what proportionate reduction would have been appropriate.

On the evidence, I am therefore not satisfied that Exceed Education was entitled to withhold the rent that it did.

Having reached this conclusion I then need to consider what rent is outstanding.

The parties were not far apart on the rent outstanding as at the end of September 2025. Exceed Education contended that the amount as at the hearing was $48,973.64, whereas Ms Sylvester puts the figure slightly higher at $49,360.96. I prefer the figure of Ms Sylvester based on her transparent calculations.

From this starting point it is necessary to consider whether any allowance should be given in Exceed Education’s favour on various accounts.

First, Exceed Education contends that allowance should be made for the $26,230.20 received by Ms Sylvester on account of the insurance claim which she submitted in respect of some of the damage at the property.

I do not accept that any allowance should be made in favour of Exceed Education for this amount – at least in the sense contended for by Exceed Education as a full stand-alone deduction in addition to the other deductions contended for.

It represented insurance proceeds received by Ms Sylvester from a claim she submitted apparently in respect of the damage to the synthetic grass. Whilst it is clear that Ms Sylvester indicated to Ms Sawiers (in her 17 May 2024 email) that she proposed to reinvest that money back into the Property, and that she agreed in cross-examination she had not yet done so, this does not provide any basis for an allowance to be made in favour of Exceed Education as a separate stand-alone item.

Whilst Ms Sylvester’s affidavit evidence also perhaps suggested a link between the insurance payout and the amount owing for the synthetic grass, this was on the basis that Ms Sylvester said that there was a dispute as to who should pay for the synthetic grass and she was not aware that payment had already been made by Exceed Education for the synthetic grass replacement. None of this evidence provides a basis for the insurance payout to be included as a separate stand-alone item.

The next item concerns an amount of $6,050 paid by Exceed Education to fix the retaining wall.

The evidence establishes a quote was provided for the work – in the sum of $4,070 and that this quote was approved by Ms Sylvester’s husband on her behalf in an email dated 6 June 2025. There is no dispute that the work was then carried out at a total cost of $6,050 and paid for by Exceed Education. The increased cost was not explained in the evidence.

I am satisfied that an amount of $4,070 should be deducted from the rent owing – being the approved quote. There was no reason for Ms Sylvester’s consent being sought and then given if it was not on the basis that Ms Sylvester was to be bearing the cost. The damage is structural and there is no real suggestion in the evidence that the damage was caused in any way by Exceed Education.

The next issue is the payment for the replacement of the synthetic grass. The evidence includes a quotation dated 21 July 2025 from Synthetic Landscape Solutions for $43,000. Ms Sawiers emailed the quotation to Ms Sylvester’s husband that same day. The covering email states:

Ms Sylvester’s husband responded on 22 July 2025, stating, among other things “we agree to the extra $5k”. Ms Sylvester’s husband had approved an earlier quote dated 18 June 2025.

Exceed Education relies on these email chains as constituting an agreement by Ms Sylvester that she would pay for the synthetic grass replacement and that Exceed Education was permitted to deduct this amount from the rent withheld by Exceed Education.

Reliance is also placed on the correspondence from Exceed Education’s lawyers to which it is contended there was no proper response. I do not place much reliance on this correspondence in circumstances where it is apparent from the letter from Ms Sylvester’s lawyers dated 6 June 2025, that Ms Sylvester took a practical approach:

There is no dispute that the work has been done and that Exceed Education has paid the $43,000 invoice – evidence having been provided by Ms Sawiers in her evidence in these proceedings and not before.

Ms Sylvester contends that there was no agreement as to who would pay for the replacement of the synthetic grass.

She contends that there is an issue as to why it was that the synthetic grass had to be replaced. She gave evidence of a plumber finding children’s toys blocking the area where the synthetic grass was laid, which apparently led to the area being flooded, causing damage to the synthetic grass. She also gave evidence of attending the Property on 19 February 2024 when it was raining heavily and removing toys and leaves and the like from the drains in the area of the synthetic grass and observing the water level to drop as a result. There was no direct evidence to the contrary.

As set out above, it appears that there was some discussion about the $26,000 insurance payout being used for the repairs to the Property, and Ms Sylvester’s affidavit proceeds on the basis that the dispute, was as to who should pay “for the balance of the invoice” which I infer is a reference to the balance of approximately $17,000 between the $43,000 invoice and the $26,000 insurance payout. Ms Sylvester was not aware at the time of her affidavit that Exceed Education had paid the invoice for the installation of the synthetic grass.

Ms Sylvester was cross-examined on her position in relation to the synthetic grass. This is one aspect of her evidence where I am concerned that Ms Sylvester did not at all times hear or at least understand the question she was being asked.

I do not regard Ms Sylvester’s cross-examination – assessed as a whole – as accepting that there was any agreement reached in relation to who would pay for the synthetic grass replacement or that she agreed to pay for it and that is why she approved the quote.

Ms Sylvester maintained that there was a dispute as to who caused the damage. She accepted, in cross-examination that she would be prepared to pay 50% of the costs of these repairs i.e. $21,500. As set out above, her affidavit evidence appears to proceed on the basis that the insurance proceeds would be put towards the synthetic grass replacement with there being a dispute as to who pays the balance of approximately $17,000. She also admitted in cross-examination that the insurance payout was in respect of the replacement of the synthetic grass, but other correspondence suggests it may have been in respect of drainage more generally.

Having regard to all of this material, I am not satisfied that any agreement was reached to the effect that Ms Sylvester would pay for the entirety of the synthetic grass replacement. The evidence also does not satisfy me as to the reason for the need to replace the synthetic grass. Having said that, it seems reasonably clear that the entirety of the insurance proceeds was to be applied against the repairs to the Property, and perhaps just the cost of the replacement of the synthetic grass. In these circumstances I am satisfied that it is appropriate in the circumstances to deduct the insurance proceeds from the amount of rent owing.

Having regard to these matters, I determine that the rent currently owing by Exceed Education is:

This analysis does not have regard to any rent that may be payable for October 2025. I am assuming that such rent as is payable by Exceed Education for October 2025 will be paid. Any issues that arise in this regard can be dealt with pursuant to the liberty to apply that I propose to grant.

For the reasons set out above, I am satisfied that Ms Sylvester has unreasonably withheld her consent to the transfer of the Lease to GAD Group.

Exceed Education is thus entitled to orders in the nature of specific performance against Ms Sylvester, conditional upon Exceed Education paying, at or prior to completion of the transfer, the outstanding rent that I have determined in the amount of $19,060.76.

If agreement cannot be reached on costs, including any costs payable pursuant to clause 5.1.4 of the Lease, I will determine that issue on the papers unless either party requests an oral hearing.

I also propose to grant liberty to the parties to apply on 2 hours’ written notice, such liberty to be exercised during business hours on notice to all parties. I am conscious in this regard that issues may arise out of these reasons for judgment which need to be determined by the Court prior to completion of the sale to the GAD Group.

The Court orders: