CONTROVERSY over the lease and upkeep of Cottesloe Beach’s Indiana Restaurant is heading to the Supreme Court after the beachside building’s operators served a writ to Town of Cottesloe on Tuesday.
“The commencement of proceedings is in response to a notice served by the Town, precluding the tenant from exercising its option to renew the lease for a further term based on alleged breaches of the lease relating to repairs and maintenance,” council chief executive Mat Humfry said.
Melbourne-based Red Rock Leisure operates the beachside restaurant, Fraser’s Restaurant in Kings Park and The Old Brewery at the nearby former Swan Brewery on Mounts Bay Road.
The Town claims a contentious 50-year lease at the Indiana is in default because Red Rock failed to indicate if it would continue with 15 and 10-year options on a 25-year lease due to expire on August 4.
“Further, the council is of the view that, based on the information provided by the tenant to date, the tenant failed to validly exercise the option, in any event,” Mr Humfry said.
The issue about the options was the technicality that caused the council to cancel a proposed $4.2 million refurbishment of the beach restaurant in March, after years of unrelated complains about dirty public toilets.
The council also alleges Red Rock failed to conduct repairs at the restaurant.
Mr Humfry said the council was anticipating the writ after it served a breach of the lease last month.
He said the council was prepared to go to court, but he would not say how much the “considerable” legal fees could cost
However, council has not been told whether the restaurant would operate after August 4, and whether it would be liable for the building’s upkeep or mothballing could depend on the court case’s outcome.
A hearing at the Supreme Court can take up to a year to be listed.
Red Rock Leisure and its Perth representatives have been contacted for comment.