Pub baron Justin Hemmes legal wrangle

Justin Hemmes is now suing boutique law firm Lands Legal over a dispute with his landlord.

Hemmes, whose Merivale Group is the largest owner of popular Sydney pubs, was two days late with rent on the Coogee Pavilion in early 2015.

So his landlord, merchant banker David Kingston, who was out of pocket $85.74, moved to evict his famous tenant.

As a result, Hemmes has launched legal action against the law firm which acted for both Mr Kingston as the vendor and Mr Hemmes as the purchaser, in the sale of the hotel.

Mr Hemmes agreed to buy the run-down Beach Palace Hotel, as it was then known, for $37 million back in March 2015.

Paying a deposit of $5 million, Hemmes agreed to pay annual rent of $1.5 million, being the interest on the residual $32 million.

Mr Hemmes’ monthly rent was due on January 3, 2015.

That particular day was a Saturday so the rent was paid on the Monday.

It was on that day that Mr Kingston issued Hemmes with a termination notice for paying the rent late. Mr Kingston’s lost interest on the two days’ rent: $85.74.

Kingston also claims Mr Hemmes’s extensive renovations had not been authorised.

Hemmes’ statement of claim has alleged professional negligence against his long-time solicitor Andrew Wennerbom, the principal of Lands Legal.

The statement of claim says the terms of the sale were favourable to Mr Kingston, allowing him to “terminate the transaction and thus have the benefit of any deposit paid and improvements to the property for late payment of rent …however slight or modest.”

Mr Hemmes, who owns a string of hotels, bars and restaurants including Ivy, The Establishment, The Beresford, The Paddington, Slip Inn and The Newport, took out an injunction to halt his eviction in March 2015.

Merivale now operates 65 hospitality venues, all over Sydney.

These include the Ivy and the Establishment Bar in the Sydney CBD and the popular Coogee Pavilion in the eastern suburbs.

Leon Getler 26th March 2018.