- Unreported Judgment
SUPREME COURT OF QUEENSLAND
No 5450 of 2006
ON THE SIDE NOOSA PTY LTD (ACN 109 014 959)
QUADRANT HOLDINGS PTY LTD
HIS HONOUR: These are the reasons for judgment in On The Side Noosa Pty Ltd against Quadrant Holdings. The amended application in this matter seeks to vary an injunction granted by Justice Helman on the 13th of July 2006. Alternatively, it seeks relief under rule 667(2)(c) of the Uniform Civil Procedure Rules in the form of setting aside Justice Helman's order, if necessary with conditions that the Court thinks appropriate.
Rule 667 is essentially facilitative. It removes any question about whether there is jurisdiction to vary an order in the case where there is an injunction. The amended application also seeks a declaration that the respondent/plaintiff's objection to the applicant/defendant's use of an area known as Area A was unreasonable. I will refer to the applicant/defendant as Quadrant and the plaintiff/respondent as OTSN during the reading of the reasons.
Justice Helman's order was made in proceedings where OTSN sought that Quadrant be restrained from taking possession of premises described in a lease, breaching the covenant of quiet enjoyment, and derogating from the grant. After Justice Helman had decided that relief in the form of an injunction should be granted, he invited counsel to settle a form of order to implement his decision. A draft was prepared and considered by counsel and, particularly for present purposes, by the solicitor for Quadrant, although for reasons that will appear later, he had a relatively brief time to consider it. At all times the provision that has precipitated the present application was in the draft, as far as the drafts that I have are concerned. The element of Justice Helman's order primarily relating to the matters in issue in the present application was that Quadrant was restrained from retaking or attempting to retake shop 9 in which OTSN conducted a restaurant and Areas A and B, in reliance on certain notices to remedy breaches and the like issued intermittently from the 7th of June 2005 to the 9th of June 2006. These documents included a purported termination of OTSN's lease and substitution of a monthly tenancy.
Quadrant was also restrained by the order from using or permitting others to use Areas A and B except that Area B was to be available for the use of stall holders and patrons of the market held on Sundays between the hours of 5 a.m. and 2.30 p.m. and Areas A and B were to be available for functions organised by the respondent on the giving of seven days notice by the respondent, provided that the applicant did not reasonably object to the proposed use, and the licensing requirements for such use were observed.
The consequence of the order was that Quadrant was allowed to use Area B for Sunday markets which had been running for several years, but not Area A which, according to the evidence, accommodates only four stalls. There was a dispute, unable to be resolved on the evidence before me, about the nature and extent of OTSN's right to use Area A, although the licensed premises description prepared by the Liquor Licensing Division describes the shop and, “the defined adjacent outdoor dining areas”, accepted by the parties to be Areas A and B, as part of the licensed premises. Area A did not exist at the time OTSN's lease began but its construction was in contemplation. There are disputed accounts of conversations about it in the negotiations for the lease. There was also evidence that in mid 2005 Mr Smith, Quadrant's manager, purported to deny OTSN the right to use Area A. For reasons enlarged on in the affidavits, from that time OTSN did not attempt to use Area A; nor did it assert a right to use Area B at any time when the markets were operating.
It is also plain from the evidence that the relationship between Mr Smith and Ms Swadling, a director of OTSN involved in running the restaurant, was strained for some time. Symptomatic of it was the series of events which precipitated the present application. OTSN had placed furniture in Area A after Justice Helman's order was made. Then Mr Smith attempted to circumvent the order by relying on the proviso permitting functions to be held in Area A to deny OTSN the right to have use of the Area A on market days.
I should mention that there was a dispute whether the letter purporting to advise OTSN that Area A was required for the purposes of a function was actually sent. In any event, that view of the proviso permitting functions is plainly untenable as a matter of construction of the order. The basis relied on by Quadrant, that by utilising the area on the next market day OTSN was making an unreasonable objection, is equally untenable. Mr Smith's actions which involved placing all the furniture in a position shown in the photographs outside the doors of the restaurant making access to the premises difficult, was followed by an allegation in correspondence between the solicitors that Mr Smith was in contempt of Justice Helman's order, although the allegation has not been reflected in the present application.
Since Justice Helman made the order in terms of the draft agreed by counsel, it is plain that it must have seemed to him within the range of possible orders that reflected the proper outcome of the application. Given the issues raised in the affidavits about the history of the relationship between OTSN and Quadrant a draft order presented in that form would be unlikely to suggest to a Judge making it that it was other than a compromise worked out between the parties. I use the term compromise perhaps in both senses of the word.
In Mr Smith's affidavit filed on the 2nd of August 2006 he asserts that he was not aware from the plaintiff's Court proceedings that by those proceedings the plaintiff was attempting to prohibit the defendant's use of Area A for the Sunday markets. Even a casual reading of the statement of claim would have demonstrated that OTSN was asserting that it had a right to use Area A since that area was something it was permitted to do under the terms of its lease and the liquor licence. Reading the material would also have indicated that it was conceded that it was common ground that use of Area B for Sunday markets was not contested by Ms Swadling.
I recognise that it is in dispute whether or not there was any agreement about the extent of the right to use Area A. However it is not necessary, and indeed is impossible on the evidence before me, to resolve that issue. The point is that it is difficult to maintain a stance of ignorance that one of the points of the application so far as OTSN was concerned was the right to use Area A on market days.
Mr Hill, solicitor for Quadrant deposes - and there is no suggestion that his evidence is challenged by OTSN - that he was away from his office on the day when the matter was originally heard and the following day, which was a Friday, because he was attending a funeral in Townsville and had remained there over the weekend.
He says he was aware, on the afternoon of Thursday the 13th of July 2006, that Justice Helman had indicated he intended to grant an injunction and that counsel were to attempt to agree on the terms of an order. When reading the draft order on Monday the 17th of July 2006, in the belief that it was to be mentioned at 10 a.m. that day, Mr Hill says that he was not aware that there was any dispute about the use of Area A for Sunday Markets.
He said he was aware, having discussed the matter with counsel by telephone after the hearing on Thursday the 13th of July 2006, that despite the terms of the application the plaintiff had, at the hearing, sought an injunction in respect of the use of both Area A and Area B. However, he did not consider the possibility that the use of both Areas A and B for the Sunday Markets was in contention since the plaintiff had accepted that the defendant would have the use of Area B for the Sunday Markets, and that the plaintiff had not used Area A for over 12 months. He therefore did not address himself to the terms of the provision relating to Sunday Markets because he did not consider it to be a contentious matter.
In the circumstances, he mistakenly considered that it was within his authority on behalf of his client to give instructions to the effect that the order in the form it was eventually made was acceptable, and did not refer the exact terms of the order to the client for instructions, nor did he speak to OTSN's solicitors in relation to the terms of the order.
He said that he first became aware that the matter was in contention upon receiving a letter from OTSN's solicitors on the 24th of July 2006. While that letter is not specifically identified, presumably it is the one sent after the actions of Mr Smith in removing the furniture belonging to OTSN from Area A and stacking it in front of the business' doors.
The reality of the matter is that the order was negotiated by counsel and no objection was raised to the terms of the order at the time it was made. It is only, it seems to me, since Quadrant has attempted to circumvent its terms that the issue of whether an amendment of the order or setting it aside has materialised. I am not persuaded on the material before me that any substantial ground for interfering with Justice Helman's order has been established.
I should also say that this is not a case where there is any evidence that financial loss will be caused to Quadrant if the order stands until the matter is resolved at trial. The only matter bearing on the issue of loss is an ad misericordiam allegation in Mr Smith's affidavit that a stallholder who sells figurines and who had been selling at the markets for six years would potentially suffer loss if she could not be accommodated on Area A.
According to Ms Swadling's affidavit, filed by leave before me, that stallholder was, prior to Area A's construction, located on the existing deck area immediately in front of her bar. If the terms of the order cause inconvenience to the stallholder it is not a crucial matter to the resolution of this application, although she is apparently a collateral casualty of the dispute.
The three other stallholders who were occupying Area A at the time of the flare-up of the present problems, according to the evidence, had only been using the area for about six months; considerably less time than the underlying dispute which OTSN seeks to have resolved in these proceedings.
The orders are as follows:
(1)the application is dismissed;
(2)the applicant pay the respondent's costs of and incidental to the application to be assessed.
- Published Case Name:
On the Side Noosa Pty Ltd v Quadrant Holdings Pty Ltd
- Shortened Case Name:
On the Side Noosa Pty Ltd v Quadrant Holdings Pty Ltd
 QSC 254
07 Aug 2006
No Litigation History