Rent arrears must be paid
The owner of a defunct Dunedin video store has been ordered to pay overdue rent.
DVD Advance Ltd and director Daniel Ferguson entered a lease agreement with the owner of the Great King St property, in the heart of Dunedin’s student quarter, in November 2013.
The relationship with property owner Marie Kung began to sour in December 2016, when the company stopped paying rent and outgoings, prompting Kung to take the matter to court.
The company accepted liability for unpaid rent and outgoings up to May 23, 2016, when premises became uninhabitable because of a flood caused by a blocked drain and the lease ended.
Kung’s counsel argued the company was liable for rent outgoings and interest from May 23, 2016, to December 2, 2016 – the end of the term of the agreement.
Ferguson claimed Kung was always aware DVD stores were in decline and his company was taking over from another video store that previously operated from her premises.
He said he contacted Kung in late 2015 and advised he would do his best, but the company may close by Christmas that year.
He said Kung told him she understood business was difficult, and the video store could remain until she found another tenant.
Kung disputed Ferguson’s account, saying there was never a suggestion he would be released from his obligation and she heard about it only after reading his affidavit.
In a High Court decision, Associate Judge Matthews found Ferguson did not have a defence against Kung’s claim.
That meant the company and Ferguson were responsible for rent, outgoings and interest up until May 23, 2016 – when the property was vacated. Liability for the period after May 23, 2016, would be resolved at trial.
The defendant was ordered to pay $36,587.62.