Myer is being sued for more than $20 million by the operators of Chadstone Shopping Centre, Victoria, in a dispute over the retailer’s lease, according to media.

Investment management company Perpetual and the Gandel family’s Bridgehead Pty Ltd, who jointly own the shopping centre, claim Myer has been underpaying annual rent increases due to a “mistake” 18 years ago in drafting its lease.

On December 24, 2015 and again in January the centre operators sent letters of demand to Myer seeking payment of the claimed outstanding sums. Myer, which entered a 30 year lease at Chadstone in 1998, has so far refused to pay.

The dispute centres of the way in which annual increases to Myer’s initial $1.6 million annual rental were to be calculated from July 1, 1999. Myer’s rent increases were to be based on paying a proportion of changes to the centre’s variable outgoings as calculated by a clause of the lease.

In a statement of claim lodged in the Supreme Court this week the proprietors claim a “mutual mistake” in the drawing up of the contract meant these increases had been miscalculated.

The shopping centre’s proprietors say the claimed error would see increases only determined by reference to changes in variable outgoings in the previous year, meaning that if the CPI or outgoings did not increase or were negative then Myer would have only to pay the original $1.6 million set in 1998. They argue that this was clearly not the belief or the intention of the parties when the lease was signed.

On the basis of the claimed mistake the proprietors claim Myer owes them $16.8 million, plus GST. They are also seeking interest, damages and costs, pushing the total amount claimed above $20 million. The shopping centre operators also want the lease amended.

This story first appeared in Appliance Retailer.