Moore & Anor v Devanjul Pty Ltd
[2007] QDC 366
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- Moore & Anor v Devanjul Pty Ltd[2007] QDC 366
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Moore & Anor v Devanjul Pty Ltd[2007] QDC 366
Moore & Anor v Devanjul Pty Ltd[2007] QDC 366
DISTRICT COURT OF QUEENSLAND
CITATION: | Moore & Anor v Devanjul Pty Ltd [2007] QDC 366 |
PARTIES: | STANLEY GORDON WILLIAM MOORE AS TRUSTEE ROBYN GAIL MOORE AS TRUSTEE (Applicants) v DEVANJUL PTY LTD (Respondent) |
FILE NO: | 46/2007 Bundaberg Registry 2189/2007 Brisbane Registry |
DIVISION: | Civil |
PROCEEDING: | Application for relief from forfeiture of lease |
ORIGINATING COURT: | District Court |
DELIVERED ON: | 2 November 2007 |
DELIVERED AT: | Bundaberg |
HEARING DATE: | 16 and 17 October 2007 |
JUDGE: | K.S. Dodds, DCJ |
ORDER: | 1. It is declared that the respondent’s re-entry to Lease B on SP133691 located at 937 Burnett Heads Road, Bundaberg, Queensland (the land) was void.2. The applicant be relieved from forfeiture of Lease B on SP133691 pursuant to section 124 of the Property Law Act 1974;3. The respondent vacate the land forthwith and deliver up all keys to the premises located on the land and do all things which may be necessary to enable to applicant to re-enter the premises;4. Except as provided for by the lease, the respondent be restrained:(a) from entering onto the land;(b) from interfering in any way with the business of the applicant conducted on the land;(c) from interfering with the applicant’s right to possession and quiet enjoyment of the land.5. The respondent pay the applicant’s costs of and incidental to the proceedings |
CATCHWORDS: | LANDLORD AND TENANT – TERMINATION OF THE TENANCY – FORFEITURE – RELIEF AGAINST FORFEITURE – where all lessees were not served with notice to remedy – where notice to remedy failed to include note to lessee of lessor’s entitlement to re-enter in event of failure to comply – approved form Law Property Act 1925 (UK) s 146 Property Law Act 1974 (Qld) s 124, s 257 Cases cited: Blewett v Blewett (1936) 2 All ER 189 Ex Parte Taylor [1980] Qd R 253 Gerraty v McGavin (1914) 18 CLR 152 |
COUNSEL: | Mr D. Williams for the applicant Mr and Mrs Berthelsen for the respondent |
SOLICITORS: | Finemore Walters and Story for the applicant Mr and Mrs Berthelsen for the respondent |
- [1]This is an application for relief against forfeiture of a lease pursuant to section 124 of the Property Law Act 1974. The respondent is the lessor. Two of the directors of the respondent appeared on the respondent’s behalf at the hearing. One of those, Vanessa Berthelsen (Mrs Berthelsen) conducted the case for the respondent.
- [2]This is the second time an application pursuant to section 124 of the Act has been brought by the applicant. In 2006 a similar application was heard by the court after the respondent has re-entered the leased property. It was ordered the applicant be relieved from forfeiture of the lease and all further steps in the proceeding (including the defendant’s counterclaim) be permanently stayed. Order Dearden DCJ 23/10/06, Bundaberg Registry Number 36/06.
- [3]The lessees are Stanley Gordon William Moore and Robyn Gail Moore as trustees for the Moore Investment Trust. They became the lessees by virtue of an assignment of the lease on 12 May 2005. At that time they were husband and wife. They are now divorced, probably at the end of 2006. At some time in 2005 or 2006 Robyn Moore resigned as a trustee of the trust. However she is still one the lessees. Reference to the applicant hereafter is a reference to the male lessee.
- [4]The lease in question was over part of land owned by the respondent. On that land is a water slide, a building and some sheds. The respondent acquired the land in 2006. At that time the lessees were the lessees of the water slide area. The applicant operated the water slide. Typically it did not operate in the winter months being from about the end of the Easter school holidays until about the school holidays in mid-September. Otherwise it operated in school holidays and on weekends or when privately booked for a function. On the other part of the land owned by the respondent a go-kart track and business was conducted by Mr and Mrs or Mr Berthelsen through a company. Mr and Mrs Berthelsen also lived on this part of the land.
- [5]It is evident that considerable acrimony exists between the applicant and Mr and Mrs Berthelsen, particularly Mrs Berthelsen. Each would blame it all on the other party.
- [6]On about 10 April 2007 according to the applicant, he informed Mr Berthelsen that he was leaving for an overseas trip to be followed on his return by cancer treatment in Brisbane. He would be absent about 3 or 4 months. According to Mr Berthelsen no such conversation occurred. At some time he became aware the applicant had gone away. Somebody, he could not recall who, had mentioned it.
- [7]Coincidentally, perhaps, according to Mr and Mrs Berthelsen a notice dated 10 April 2007 advising of an impending inspection of the leased premises on 24 April 2007 at 8.30am was placed in the kitchen at the water slide.
- [8]An employee, a Ms Zoet was to manage the operation of the water slide in the absence of the applicant. Ms Zoet gave evidence. Ms Zoet was at the water slide over the Easter holiday period until 15 April and the weekend of 21 and 22 April. The last day of operation of the water slide was 28 April. She saw no such notice or envelope containing the notice. Nor did she see Ms Berthelsen at the waterslide.
- [9]According to Mr and Mrs Berthelsen an inspection was made on 24 April 2007. On the same day a notice to remedy breaches of covenant within 30 days was placed in the kitchen at the water slide and another copy was put under the screen door at the applicant’s residence. A lengthy list of alleged breaches was attached which it was said required remedial action.
- [10]Ms Zoet did not see this document either nor did Mr Muller a neighbour of the applicant who gave evidence by affidavit and was not required for cross examination. Mr Muller had been charged by the applicant with keeping any eye on his residence while he was away.
- [11]In due course a notice of termination of lease dated 25 May 2007 was issued and the respondent re-entered and removed property from the leased premises.
- [12]Section 124 of the Act provides:
“(1) A right of re-entry or forfeiture under any proviso or stipulation in a lease, for a breach of any covenant, obligation, condition or agreement (express or implied) in the lease, shall not be enforceable by action or otherwise unless and until the lessor serves on the lessee a notice—
(a) specifying the particular breach complained of; and
(b) if the breach is capable of remedy, requiring the lessee to remedy the breach; and
(c) in case the lessor claims compensation in money for the breach, requiring the lessee to pay the same;
and the lessee fails within a reasonable time after service of the notice to remedy the breach, if it is capable of remedy, and, where compensation in money is required, to pay reasonable compensation to the satisfaction of the lessor for the breach.”
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“(8) The notice mentioned in this section shall be in the approved form.”
- [13]According to the applicant he did not see nor was he aware of the inspection notice, the notice to remedy or the termination notice until July 2007 when he was shown them by the police. He had been away from Bundaberg from 10 April, initially overseas returning for a couple of days at the end of May and then returned to Brisbane for cancer treatment. He returned to Bundaberg on 7 July. Shortly after that he went to the water slide and found that the locked shed has been opened and all equipment, papers and his personal diary were gone. Stock and equipment including from the kitchen area excluding large items such as the freezer were also gone. He phoned the police. Mr and Mrs Berthelsen attended when the police attended and he was shown the various notices which were given to the police by Mrs Berthelsen.
- [14]None of the notices allegedly served of the applicant were served on Ms Robyn Moore, the other lessee.
- [15]As part of the case for the respondent a computer disk containing a large number of photographs said to have been taken variously on 1September 2006 and 24 April 2007 (before the respondent had re-entered) and in July and August 2007 (after the respondent had re-entered) was admitted as an exhibit. Displayed thereon were various aspects of the leased premises and common area.
- [16]As a general comment as to what may be observed in the photographs it may be said that the grounds of the leased area, remote from the water slide itself in some parts displayed untended vegetation growth particularly against fences. Also shown were some stored loose items such as pavers, apparently pieces of equipment, fencing and gates, building or plumbing material. In some of the areas shaded by canvas or shade cloth, some of the canvas or cloth appeared to be tatty or sagging. An area of concrete where some wooden eating tables were was very rough which the applicant explained occurred because he had acquired some leftover concrete without payment and it went off before he could properly level and smooth it. An umbrella in a small pool had been lost from the top of its pole and not repaired. It was said to have been in that state for some time. Surface rust was evident on some parts of the water slide and its supports. This may be expected in an environment such as a water slide from time to time. The base of an upright post of a fence surrounding the area of the platform at the top of the water slide was completely rusted away so that the pole was not in contact with the floor of the platform. This was evidently of long standing. Some photos showed black mould on parts of exterior brickwork evidently caused by water over a long period, dirty toilets and basins and gardens which had not been attended very much.
- [17]There was evidence that in April 2007 after the close of the water slide (although there was at least one private function after its closure for the season) three of the five toilets needed attention. Some were blocked and some had leaking cisterns. A number of toilet doors were not lockable (the toilets were also used by the go-kart track). There was evidence that for some time prior to the end of the season in April 2007 the water feed to the top of the water slide had been leaking at a casing. The applicant had attempted to contain the leak with duct tape but by the 28 April 2007 it worsened to an extent that Ms Zoet closed the slide. There was some evidence that in April 2007 perhaps 15 April 2007, a pump circulating water to the main splash down pool had been left running over night. According to this evidence when noticed by a Mr Herring the pool (fibreglass) had been partly emptied and the sides were bulging in. He cut the chain locking the pump shed door and turned off the pump. He attempted to refill the pool but it would not retain water seemingly leaking water from the bottom. This evidence conflicts with the evidence of Ms Zoet who said she noticed no problem with the pool.
- [18]A lot of what was shown in the photographs were items which would typically be attended to by maintenance from time to time. The photographs in September 2006 and April 2007 were taken before the season began and at the end of the season. Those taken later in 2007 were taken during what ordinarily would be the mothball period. Allowing for that, the impression gained is of premises which were maintained to an extent necessary to keep them operating. Matters requiring prompt attention are those which may impact upon safety of users or result in permanent damage to the leased property.
- [19]The notice to remedy breach referred to a number of clauses of the lease. Some of those referred to were non-essential terms. They may be put to one side.
- [20]A notice to remedy breach must set out the particular breach complained of with sufficient particularity to bring to the lessee’s attention the covenant alleged to have been broken and the manner in which it has been broken.[1] Some of the material in the notice plainly failed to achieve this. Moreover, evidence during the hearing of the application revealed that some of the breaches alleged were not in fact breaches, for example – pest control, legality of pool fencing.
- [21]Of the others, specific mention may be made of the requirement to insure. Clause 4.1 of the lease required the lessees to have current insurance “for all of the following:
4.1.1 Public Liability Insurance Policy for $10 million dollars;
4.1.2 Industrial Special Risks Policy for the usual risks covering property owned by you for its full value;
4.1.3 Plate glass for its replacement value;
4.1.4 Fire and all usual risks with respect to premises”.
- [22]The notice to remedy asked for evidence of insurance satisfying these criteria. The allegation was that a policy which the lessees held which had expired on 31 August 2006 did not comply.
- [23]On the hearing of the application, evidence of insurance which the lessees held was provided. So far as it went this showed that public liability insurance to $10 million dollars was in place. Otherwise there was a policy classed as Leisure Business Insurance in place which covered material damage to the building and other specified items and risks.
- [24]An Industrial Special Risks Policy is a policy typically negotiated by insurance brokers and tailored to meet particular requirements of an insured.[2] Typically such a policy may cover for a variety of risks such as fire, loss or damage to buildings and property, burglary, personal injury, public liability, products liability, consequential loss due to business interruption, plate glass and so on. The lease required such a policy for property owned by the lessees for its full value.
- [25]It was not clear from the evidence provided at the hearing that insurance as required by the lease exists. Premises would I think include the building, water slide and sheds. It is I think to be implied that insurance required by the lease is for the value of the structures (unless a particular amount is specified in the lease) so that there is not under insurance. I consider the lessee to be required to demonstrate to the lessor that insurance as required by the lease has been obtained.
- [26]What I have said so far is perhaps superfluous to an extent for the purported forfeiture of the lease was invalid for a number of reasons:
- The approved form (section 124(8) of the Act) contains a note at the bottom of it as follows “(Note: the lessor will be entitled to re-enter or forfeit the lease in the event of the lessee failing to comply with this notice within a reasonable time – see section 124 of the Property Law Act 1974)”.
The notice to remedy breach said to have been served does not contain this note. In Ex Parte Taylor [1980] Qd R 253, DM Campbell J held that a failure to include this paragraph in a notice to remedy breach had the effect the notice was not a proper notice, the giving of a statutory notice was a condition precedent to enforcing a forfeiture and subsequent re-entry by a lessor relying upon a failure to remedy the breach specified in the notice was unlawful.
- None of the notices, neither that advising of an inspection or the notice to remedy breach were served on Ms Robyn Moore, the other lessee.
In Blewett v Blewett (1936) 2 All ER 189 the Court of Appeal held that section 146 of the Law Property Act 1925, the equivalent of section 124 and in the same terms, required the notice to remedy breach be served on all the lessees. Failure to do so meant the notice to remedy was bad and could not be relied upon.
- The notice to remedy was not served on the applicant either, or at least it did not come to his attention.
Section 257 of the Act provides that a notice such as the notice to remedy breach may be served by, inter alia, leaving it for the person at the person’s usual or last known place of abode or if the person is in business as a principal, at the person’s usual or last known place of business.
The requirement for service of such a notice is to provide an opportunity for the lessee to remedy an alleged breach if it is capable of remedy. Here it should be taken there was no such opportunity for, I think it probable, the notice to remedy breach did not come to the notice of the applicant. Moreover, he was away overseas or in Brisbane for cancer treatment during any relevant period. I find Mr and Mrs Berthelsen were aware of this if not on 10 April (about which I make no finding) at least shortly thereafter. I accept that the alleged depositing of the notice in the kitchen of the water slide and under the screen door of his premises did not come to the attention of either Ms Zoet, Mr Muller or Mr Moore.
Orders
- [27]It is declared that the respondent’s re-entry to Lease B on SP133691 located at 937 Burnett Heads Road, Bundaberg, Queensland (the land) was void.
- [28]It is further ordered:
- (i)that the applicant be relieved from forfeiture of Lease B on SP133691 pursuant to section 124 of the Property Law Act 1974;
- (ii)the respondent vacate the land forthwith and deliver up all keys to the premises located on the land and do all things which may be necessary to enable to applicant to re-enter the premises;
- (iii)except as provided for by the lease, the respondent be restrained:
- (a)from entering onto the land;
- (b)from interfering in any way with the business of the applicant conducted on the land;
- (c)from interfering with the applicant’s right to possession and quiet enjoyment of the land.
Costs
- [29]On 23 July 2007 solicitors for the applicant wrote to the respondent advising that the documents had not been brought to the applicant’s attention until handed to him via the police when he attended at the water slide on 8 July 2007. The letter requested the lease be reinstated and all the applicant’s property be returned and the applicant be granted full and unfettered access to the premises otherwise an application would be made to the court for relief from forfeiture and costs would be sought.
- [30]I order the respondent pay the applicant’s costs of and incidental to the proceedings.