127 Hobson Street Ltd v Honey Bees Preschool Ltd - [2020] 1 NZLR 179

Contract — Enforcement of contract — Contract collateral to lease — Landlord undertaking to install second lift by specified date — Indemnity from rent and other payments in event of breach — Whether indemnity clause unenforceable penalty — Test for penalty clause and nature of inquiry by court — Whether out of all proportion to legitimate interests of tenant — Interpretation of indemnity — Extent of legitimate interests — Relevance of inequality of bargaining power — Whether comparison required with damages that would have been awarded at common law.

Property law — Lease — Right of renewal — Whether new term separate and new lease — Whether indemnity for tenant under collateral contract confined to first term of lease.