Using else to display error for missing category

I'm testing/researching using categories for a project using the portfolio categories example in the docs.

I have a problem where if there's "no" portfolio item with a given category is should display a "nothing here" error.

1. I'm displaying a list of portfolio items on the URL category.php?cat=products/forestry/

<perch:before>
<ul>
</perch:before>
<li> 
     <a href="detail.php?s=<perch:content id="slug" type="slug" />">
          <perch:content id="image" type="image" width="100" height="100" crop="true" output="tag" />
          <perch:content id="title" type="text" />
     </a>       
</li>
<perch:after>
</ul>
</perch:after>

1. The category page lists all the "forestry" titles in a list using...

<?php    
            if (perch_get('cat')) {
              perch_category(perch_get('cat'),array(
                'template'=>'category_single.html'
            ));
              perch_content_custom('Portfolio', array(
              'template' => 'portfolio_listing.html',
              'page'=>'/portfolio.php',
              'category' => perch_get('cat'),
            ));
            } else {
              perch_categories(array(
        'set' => 'Products',
        ));
            }
            ?> 

1. If there's no portfolio items yet allocated to "forestry" no list is displayed. So to create an error the portfolio_listing.html I'm using...

<perch:before>
<ul>
</perch:before>
<li> 
<perch:if exists="title">
     <a href="detail.php?s=<perch:content id="slug" type="slug" />">
          <perch:content id="image" type="image" width="100" height="100" crop="true" output="tag" />
          <perch:content id="title" type="text" />
     </a>   
<perch:else />
     <p>Sorry nothing here!</p> 
</perch:if> 
</li>
<perch:after>
</ul>
</perch:after>

This does not work and outputs nothing. Where am I going wrong?