A major legal showdown is brewing in Victoria's Supreme Court between one of Geelong's key shopping centres and a retail titan over a substantial unpaid debt.
The dispute centres on alleged unpaid rent and outgoings totalling more than $1.5 million for a flagship store in the heart of the city.
The Core of the Multi-Million Dollar Dispute
Market Square Shopping Centre, owned by ISPT, has launched legal action against the Cotton On Group. The claim relates to the group's large-format Cotton On store located at Shop 101 within the Malop Street complex.
The shopping centre's management alleges that Cotton On Group failed to pay rent, outgoings, interest, and other charges as stipulated in their lease agreement. The total sum claimed has escalated to $1,509,843.90, according to court documents filed by ISPT's lawyers, Herbert Smith Freehills.
Cotton On Group, a global retail empire founded in Geelong, has defended the claim. Through its legal representatives at Mills Oakley, the company filed a defence in the Supreme Court of Victoria, contesting the amount claimed.
A Timeline of Legal Manoeuvres
The case has been progressing through the court system for some time. The initial writ was filed by Market Square. Cotton On Group responded with its defence in February.
A critical case management hearing was held before Justice Lisa Nichols in the Supreme Court on Thursday, April 25, 2024. During this hearing, the judge ordered both parties to undertake a series of pre-trial steps, setting the stage for a potential trial.
The court has mandated that the parties complete the discovery process, exchange lay witness statements, and attempt mediation in a bid to resolve the dispute out of court. Justice Nichols has listed the matter for a directions hearing on August 9, 2024, to check on progress.
Should mediation fail, the path is cleared for a full trial. Justice Nichols indicated that if required, the trial would be scheduled for a date in February 2025, with an estimated duration of three to five days.
Implications for Geelong's Retail Landscape
This legal battle places two significant Geelong entities in opposition. Market Square is a central retail hub for the city, while Cotton On Group is a homegrown success story with a massive global footprint.
The dispute highlights the ongoing financial pressures and complex negotiations between landlords and retail tenants, even for established and successful brands. The outcome of this case could have broader implications for commercial leasing agreements and negotiations in the Australian retail sector.
Both parties are now compelled to prepare their evidence thoroughly. The court's timeline requires them to be ready for mediation or trial, ensuring this multi-million dollar disagreement will reach a resolution within the coming year.
For now, the Cotton On store in question remains operational at Market Square, but the substantial financial claim casts a shadow over the landlord-tenant relationship as the legal process unfolds.
