Landlord won its appeal but costs stay reserved until the retail lease case is finally decided (NCAT, 2026)

What happened

The dispute concerned a stand-alone kiosk in a shopping centre at Stanhope Gardens in western Sydney. A franchisee ran a bubble-tea kiosk from the premises under licence from the tenant company, which was associated with the franchisor. Both sides accepted the kiosk was a retail shop and that the lease was a retail shop lease under the Retail Leases Act 1994 (NSW). The lease was entered into on 25 March 2021, was due to expire on 28 February 2027 and had no option to renew.

On 16 January 2026 the tenant, Sharetea Leasing Pty Ltd, started proceedings in the Consumer and Commercial Division of NCAT. It asked for six items of urgent interim relief under section 72 of the Retail Leases Act: a stay of forfeiture (that is, a hold on the landlord's right to end the lease and take the shop back) until the case was finally decided, a return of possession, orders to protect quiet possession, a restraint stopping the landlord re-entering or dealing with the premises, an undertaking that the tenant would keep paying rent and other amounts, and an expedited final hearing. The tenant's stated reason was the financial effect of a lockout on it and on the franchisee, who could not trade. The tenant disputed that the termination was valid, and said that in any event the default had been fixed. By the time of the appeal the kiosk itself had been demolished.

On 6 February 2026 the Tribunal made an order restraining the landlord from entering or dealing with the premises. On 4 March 2026 a Senior Member made orders on the papers with written reasons. Those orders set aside the February restraint, recorded that by consent a hearing of the application for relief against forfeiture was dispensed with under section 50 of the Civil and Administrative Tribunal Act 2013 (NSW), granted relief against forfeiture, reinstated the lease, held the termination notice invalid, confirmed the tenant's possession and quiet enjoyment once the premises were restored, ordered the landlord to reinstate the premises to substantially the same state, condition and configuration as before the purported termination within 10 weeks, and suspended rent in full until reinstatement and possession.

The landlord, Stanhope SC Pty Ltd as trustee of the Stanhope SC Investment Trust, appealed on 31 March 2026. On 10 June 2026 the Appeal Panel granted leave to appeal and allowed the appeal. It found the documents did not show that the nature of the hearing had changed from interim to final, and that it was procedurally unfair to make what was in substance a final decision on the papers without the landlord's consent, which had not been given expressly and could not be implied. A lack of procedural fairness is an error on a question of law. The Panel reinstated the interim regime, remitted the case for an expedited final hearing, and by order 9 vacated existing costs orders and reserved the costs of the appeal and of the Tribunal proceedings to be dealt with after the final hearing. Order 10 let either side put in written submissions if it wanted a different costs order.

What each side wanted

The landlord asked the Appeal Panel to change order 9 and award it costs. It argued that the "event" of the appeal was its own success in showing that the first decision had effectively granted final relief without its consent and in a procedurally unfair way, which was an error on a question of law. It said the ordinary costs rules applied through rules 38(2)(b) and 38A of the Civil and Administrative Tribunal Rules 2014 (NSW) because the amount claimed or in dispute in the first proceedings was more than $30,000, and that it was entitled to be indemnified for its legal expenses under clause 13.3 of the lease. The tenant disputed each point. It said the amount in dispute and whether the indemnity clause was triggered were matters for the final hearing, on which the Panel had deliberately not expressed a view; that the appeal had decided only a narrow procedural question and none of the hotly contested substantive issues; that if the landlord ultimately lost on everything its appeal costs might be seen differently; and that it was premature to decide costs, or alternatively costs should be costs in the cause.

What the tribunal decided

The Appeal Panel declined to change its earlier costs order. Its single order was: "the appellant's application to vary order 9 made on 10 June 2026 is declined and dismissed". The decision was made on the papers and the orders were made on 18 September 2026.

No money was ordered to be paid either way. The practical effect is that order 9 stands: any existing costs order made by the Tribunal is vacated, and the costs of the appeal and of the Tribunal proceedings up to that point remain reserved, to be determined as part of the costs of the proceedings after the final hearing.

Why the tribunal decided it that way

The Panel explained that it had deliberately not decided the other appeal grounds, because those grounds attacked findings and conclusions that were likely to be the subject of significant contest at the final hearing, and it would be unfair to discuss them. The same restraint applied to costs. Two of the landlord's costs arguments depended on facts that had not been decided: how much was actually claimed or in dispute, which is what rules 38(2)(b) and 38A of the Civil and Administrative Tribunal Rules turn on, and whether the conditions for the indemnity in clause 13.3 of the lease were met. Those were matters for the final hearing.

The Panel also looked at what the appeal had actually achieved. The appeal turned on one procedural point: that it was unfair to decide final relief on the papers without the landlord's consent, and the Panel used its powers under section 81 of the Civil and Administrative Tribunal Act to put the interim arrangements back in place while the case was prepared for an expedited final hearing. What the landlord had preserved was its right to a full final hearing, including cross-examination on contested questions of credit and probability. It had not won on any of the underlying issues.

Drawing an analogy, the Panel said that while an unsuccessful interim application to preserve the position may well attract a costs order against the party that made it, a successful interim application that preserves the position is likely to lead to costs being reserved or being costs in the cause, because the usefulness of that interim win depends on how the case finally turns out. The tenant's point that an interim win can prove hollow once the final result is known was the same thinking that had led the Panel to reserve costs in the first place. On that basis the Panel declined to vary order 9.

What this means if you are in a similar position

If you are in a similar position, this decision shows two things about how NCAT handles retail shop disputes. The first is about process. Section 72 of the Retail Leases Act lets the Tribunal make urgent interim orders, such as holding off a forfeiture or stopping a landlord dealing with the shop, while the real argument is still to be heard. Interim orders and final orders are different things, and a decision made on the papers in an interim application does not become a final decision just because the parties happened to argue about final issues in their submissions. Deciding final rights without a party's consent, and without giving it the chance to contest that course, is treated as a lack of procedural fairness and so as an error on a question of law.

The second is about costs. Winning a step along the way does not automatically produce a costs order in your favour. Where a party succeeds on an interim application that simply preserves the existing position, the Tribunal may decide it cannot sensibly value that win until the case is finished, so it reserves costs or makes them costs in the cause. Arguments that depend on facts still to be decided, such as how much is in dispute or whether an indemnity clause in a lease has been triggered, are likely to be put off to the final hearing as well.

In a retail lease dispute, the step most people take first is a written notice of dispute to the other side setting out the breach or the disagreement and what they want done about it, often with a request for mediation, before any tribunal application is filed.

How to apply: our step-by-step guide to a NCAT application. More decisions: NCAT cases and other civil disputes.

Source: Stanhope SC Pty Ltd atf Stanhope SC Investment Trust v Sharetea Leasing Pty Ltd [2026] NSWCATAP 298 (read the full decision). This summary was prepared from the published decision for general information. It is not legal advice, and the tribunal’s own reasons are the authoritative record.