Colette by Colette Hayman will be relinquished of $648,923 owing in rent due to its “extraordinary” position.
Deloitte Restructuring Services partners Vaughan Strawbridge, Sam Marsden and Jason Tracy were appointed as Colette's voluntary administrators this year.
The administrators requested a 100 per cent rent reduction from landlords due to unprecedented circumstances, and were offered 9 per cent.
Taking the matter to the Federal Court, they argued the payment of rent would deplete resources and hinder the future sale as a going concern.
Judge Markovic ruled the brand will not pay rent on 93 stores due between April 1 and 14.
“The administrators find themselves operating the Colette Group in an ever-changing environment brought about entirely by external factors.
“They need to be agile and able to react to the interests of stakeholders. One of these groups is of course the creditors of the Colette Group.
“When this application was viewed in that light, it was clear to me that making the orders sought [were] in the interests of the creditors of the Colette Group as a whole.”
The landmark decision could have broader repercussions for landlords and retailers, as the latter battle through unprecedented lockdowns brought on by COVID-19.