Pharmacist claims pressure on sub-lease

A medical practice has taken a pharmacist to court after a “metal fence” and equipment blocked off part of the premises it claimed to lease

The GP surgery operates a medical practice and integrated health care facility from the ground floor of the central Sydney premises, sub-leasing it from a pharmacist.

This pharmacist owns and operates a pharmacy business from the premises, leasing it in turn from another operator, which was named as the second defendant.

The GP practice was seeking final relief that the pharmacist and the owner of the premises be restrained from stopping the GPs, staff and patients from accessing the premises – and was also seeking damages for breach of quiet enjoyment.

However, the pharmacist said that he had not entered into the sub-lease, and that the medical practice had “exerted undue pressure on him and required him to sign the document on the misrepresentation that the sole purpose for the document was a Medicare requirement”. These claims were denied by the medical practice.

The Court heard that the medical practice relied on pharmacy staff to open the premises’ front and side doors so that medical centre staff could gain access.

The medical practice alleged that the pharmacist failed to provide the medical centre with access on Saturday mornings, in breach of the sub-lease.

The pharmacist also disputed whether the medical practice was entitled to occupy certain parts of the premises which made up part of the medical centre.

Between August 2017 and April 2019, the medical centre occupied and used all of the medical rooms in the back left and back right of the premises it occupied, as well as the waiting/reception area identified on a plan of the premises.

However, in around April 2019, the Medical Centre ceased using the back-right medical rooms as patient consulting rooms.

The principal GP said that this was because of concerns about a move in the pharmacy, whereby the dispensary was moved to a new location parallel to the medical centre reception.

The GP said this meant that medical centre patients would have to pass through the pharmacy dispensary in order to get to the medical centre, with the legal complications this could pose. The pharmacist denied altering or moving the dispensary.

From April 2019 to January 2020, the medical practice used the back-right medical rooms for storage – but in July 2019, the principal GP said, his key “no longer worked”.

He concluded that the locks had been changed, but the pharmacist denied this had happened.

Also in July 2019, a “high metal structure” which the GP called a “metal fence” was erected in the corridor between the premises’ front door to the street, and the waiting/reception area of the Medical Centre.

The pharmacist said that this structure was a “two-sided metal display stand for pharmacy stock” and said it did not affect movement through the premises, though the Court noted otherwise, saying it “blocks free movement to and from the Medical Centre’s waiting/reception area” from the front door via the medical centre corridor.

By later in July 2019, the structure was moved closer to the medical centre’s waiting/reception area and a “low makeshift barrier” appeared between the pharmacy corridor and the medical waiting/reception area.

The principal GP contended that the pharmacist refused to provide the medical practice access to the premises on weekends and on numerous occasions pharmacy staff did not unlock the door until after its opening hours, and forced it to close the medical centre before its closing time of 6pm.

He also said that the medical centre’s internet access was removed, the key its staff used to access the toilets went missing and was not replaced, and garbage and other items also appeared in the medical centre’s reception area.

He claimed that a security camera set up by the medical practice had been moved or covered, and that “following most of these occasions, Medical Centre staff reported that the reception area had been vandalised, medical records had been compromised and cash was missing from the Medical Centre’s cash box”.

The pharmacist said the camera was moved or covered up as it was an invasion of his and his patients’ privacy.

In January 2010, items which had been stored in the back-right medical rooms were moved to the corridor outside the back-left medical rooms, partially blocking access. The pharmacist said this was done as the items had been placed in the pharmacy dispensary.

Following this, the medical practice cancelled about 90 appointments scheduled for that week, as well as the employment of a locum doctor.

A few days later, the principal GP returned to work and found that “the Medical Centre’s sign which had been hanging outside the Premises, and all posters and frames for the Medical Centre, had been removed”.

He also noted the equipment still blocking the corridor, and the metal structure still in place by the reception desk.

He contacted the pharmacist’s legal representatives and the medical centre was closed for all services apart from urgent scripts and a nurse on call for emergencies.

The Court noted that based on the evidence, the medical centre had “established a reasonably strong prima facie case that the Sub-lease is valid,” and was correct in its contention as to which rooms it was entitled to occupy, as well as establishing a breach of quiet enjoyment.

The restriction on use of the back-right medical rooms, the metal structure in the reception area and the high makeshift barrier, as well as the equipment appearing in the corridor, “all involve, in my view, seriously arguable substantial interferences by [the pharmacist or by those on his behalf] of [the medical centre’s] ordinary and lawful enjoyment of the Sub-leased area of the Medical Practice”.

The court noted that damages of some losses could be assessable in this case, and that in order to establish damages at a final hearing, the medical practice would need to establish that the pharmacist “breached his obligations and that it has suffered loss that is quantifiable to support a monetary award”.

Other potential losses, including stress on medical centre staff caused by angry patients abusing them after appointments were cancelled and the centre closed, would be tougher to quantify, the Court noted.

The Court granted the medical practice injunctive relief, saying it had shown that there were serious questions to be tried, including whether the pharmacist’s refusal to provide the medical centre with access on Saturday mornings was in breach of the sub-lease.

It ordered the removal of the metal barrier, and to ensure that the medical practice staff could access the premises during its opening hours, including on Saturdays.

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