Smokey Australia Pty Ltd v Premier Properties Pty Ltd
[2004] QSC 74
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- Smokey Australia Pty Ltd v Premier Properties Pty Ltd[2004] QSC 74
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Smokey Australia Pty Ltd v Premier Properties Pty Ltd[2004] QSC 74
Smokey Australia Pty Ltd v Premier Properties Pty Ltd[2004] QSC 74
SUPREME COURT OF QUEENSLAND
CIVIL JURISDICTION
WHITE J
No BS 11766 of 2003
SMOKEY AUSTRALIA PTY ACN 078 039 719 | Applicant |
and |
|
PREMIER PROPERTIES PTY LTD ACN 073 858 027 | First Respondent |
and |
|
ROBERT STOWASSER PTY LTD ACN 051 549 181 | Second Respondent |
(as Trustee for the Robert Stowasser Family Trust) and |
|
Gregory Allan Cowderoy (as Trustee for the Cowderoy Family Trust) |
|
BRISBANE
DATE 11/02/2004
JUDGMENT
HER HONOUR: The applicant is the lessee of Shop 4 in a strip shopping centre described as Windermere Village at Jindalee. By its directors it executed a lease in respect of those premises on the 27th of March 2003. It was executed by the lessor on the 4th of April 2003. The lease as executed contained in Clause 4 stipulations about outgoings. Clause 4.3 defined “Owner's Outgoings”, of which the lessee was required to pay a nominated proportion as follows:
“(a)All rates and taxes (excluding land tax), charges (including water, trade waste and sewerage usage charges), assessments, impositions, duties and fees of the local government levied, assessed or charged in respect of the Centre or any part of it (irrespective of the ownership thereof); and
- All amounts payable in respect of insurance relating to the Centre including all premiums and stamp duties relating to insurance of the Centre and the structures and appurtenances installed therein to their full insurable reinstatement value against all usual risks; machinery breakdown insurance; plate glass insurance; public liability insurance; workers compensation insurances; and any other insurances effected by the Owner in relation to any risk relating to the owner's ownership or interest in the Centre but exclusive of any excess or penalty rates recoverable from any tenant of the Centre.”
By letter dated 18 June 2003 the lessor's solicitors informed the lessee's solicitors that the definition of outgoings in the lease was not the same as in other leases in the Centre and “for the sake of clarity” requested that additional paragraphs extending outgoings be inserted into the lease. This does not give quite the correct impression since Mr O'Dea, the solicitor responsible for this matter for the lessor deposes that the “incorrect” precedent had been used for all of the leases in the Centre, but subsequently there has been agreement to rectify those leases.
Be that as it may, the lessee declined to agree to vary the lease as requested. Correspondence ensued in which the lessor's solicitors said that the desired amendments would be made to the lease in reliance on Clause 3.3(i) of the Agreement for Lease. Clause 3.3 provides:
“The lessee irrevocably authorises, empowers and directs the lessor's solicitors upon the lease commencement date or as soon thereafter as is practicable to complete the three executed copies of the lease and the licence agreements by:—
- Inserting in Item (2) in the Form 7 in the lease the real property description of the land comprising the premises as at the lease commencement date;
- Inserting in Item 3 of the Reference Schedule of the lease the description of the “land” (including all parcels of land comprising the “Centre” and any adjoining parcels of land used in connection with the “Centre”;
- Inserting in Item (6) in the Form 7 in the lease and Item 5 of the Reference Schedule of the lease, the term, the lease commencement date and the termination date of the term;
- Inserting in Item (7) of the Form 7 lease and in Item 6 of the reference schedule of the lease, the rend subject to the provisions of Clause 33;
- Inserting in Item 7 of the reference schedule of the lease the rent review dates;
- Inserting in Item 8 of the Reference Schedule of the lease the lessee's proportion of outgoings calculated in the manner contained in the lease proportionally on a lettable area basis;
- Inserting in the lease, if necessary, the name, address and other details of the lessor and the lessee;
- If necessary for the purpose of registration, inserting in the lease a plan of the premises in registrable form and any other plan required to enable the lease to be registered; and
- Making any other minor or non-material variations or amendments to the lease, the car park licence or the retail occupation licence that may be necessary to have the same completed and registered and which are in accordance with the terms of this Agreement.”
The lessee's solicitors responded that the proposed amendments were neither minor nor non-material variations or amendments to the lease and concluded “If as it appears you are asserting there is some other agreement between the parties, please particularise it”. Without further notice to the lessee the lessor's solicitors removed page 6 of the lease which contained Clause 4 and replaced it with a fresh page on which the additional categories of outgoings sought by the lessor were added but so as to appear as if they were there originally and not as amendments and accordingly did not disturb the flow of the lease provisions which might otherwise have called for a requisition by the Registrar of Titles.
The additional subparagraphs to Clause 4 of the lease were:
“(c)All proper and reasonable costs of the operation, maintenance and supply of any services normally provided in a Centre of a similar nature from time to time provided by the lessor for the occupiers of the Centre including supply and maintenance of the appurtenances, the provision of hot and cold water, supplies for washrooms and lavatories and cleansing, maintaining, decorating and landscaping the land;
- The costs of repairs and maintenance of the Centre but not including structural works; and
- All costs incurred in providing lighting, fuel and power to common areas and plant rooms, lighting, heating and other services and systems in and for the operation of the Centre.”
The solicitors arranged for the lease's registration in that form which duly occurred and sent a copy to the lessee's solicitors. Those solicitors immediately objected and required the lessor to lodge a Form 13 amendment to the lease and threatened a caveat. A caveat was lodged on the 19th of September.
The lessor had entered into a contract to sell the property on the 11th of August 2003 with the second respondent to this application. The lessee filed an originating application on the 18th of December 2003 seeking a declaration as to the proper construction of Clause 3.3(i) of the agreement for lease, an order pursuant to section 188B of the Land Title Act 1994 that the Registrar of Titles delete paragraphs 4.3(c), (d) and (e) from the lease; alternatively an order that the lessor do so and other relief which I need not detail.
The lessor was served on 22 December. At the hearing yesterday, without earlier notice to the lessee, Mr R Anderson, who appears for the lessor, sought leave to file an application to rectify the lease by replacing Clause 4.3 in the executed lease with 4.3 as it appears in the registered lease. Alternatively that the whole proceeding continue with pleadings. The second respondent, the new owner of the shopping centre, had no knowledge of the dispute between the lessor and lessee and abides the order of the Court.
On one view, that favoured by the lessor, it might be thought convenient to have both applications disposed of in the one proceeding, but disputed matters of fact about knowledge of what the lessor contends are the true terms of Clause 4.3 agreed by the parties particularly mean they cannot be resolved on this application instanter. There are aspects about the conduct of the lessor which suggest that both applications should not be adjourned.
I propose then to consider the construction application. The additional outgoings for which the lessee is liable have only to be recited to see that they are neither minor nor non-material. They oblige the lessee to contribute to maintenance and repairs of the shopping centre, lighting, fuel and power to the common areas, landscaping and cleaning. When Clause 3.3 is read in its entirety the flavour of “any other minor or non-material” amendments plainly does not include the lessor's amendments. Without more the declaration may be made.
Mr Franco, for the lessee, contends that section 188B(3)(a) of the Land Titles Act permits the Court to order the Registrar of Titles to correct an indefeasible title where there has been an incorrect registration - see section 188(1)(c). Mr Anderson submits for a narrower construction of the provision which would place the power in the context of section 188, in particular conduct for which the State via the office of the Registrar might be liable.
There is a deal of differing authority on the point which it is unnecessary to resolve here and in the absence of more complete argument I would prefer not to embark upon this exercise. Section 67 of the Land Titles Act provides an applicable mechanism for amendment to a registered lease by the parties and Form 13 provides the means to give effect to it.
Mr Anderson submits that I should not make the declaration as he puts it “in a vacuum” since his client is confident that the rectification of the executed lease would be granted. Mr King, director of the lessor, deposes that the form of Clause 4.3 inserted into the lease by its solicitors and executed by him without noting Clause 4.3 did not reflect the true intention of the lessor.
Mr Anderson points to a number of pre-contractual documents which contained a more extended meaning of “outgoings” consistent with Clause 4.3 as it appears in the registered lease and which were given to the lessee's directors. These documents are the lessor disclosure statement provided in early October 2002 to the lessee, the letter of intention to lease, drafted by the lessor but made by the lessee where the expression “total building outgoings” appears, and a letter of 15 October 2002 setting out in broad terms the conditions and terms said to be “subject to issue of lease documentation”, where the expression “total building outgoings” also appears. This description of outgoings is not inconsistent with that in section 7 of the Retail Shop Lease Act 1994.
The agreement to lease contains in Clause 22.1 the following:
“This agreement and any offer to lease constitutes the full and complete understanding between the parties with respect to the subject matter of this agreement. There is no other oral understanding, agreement, warranty or representation whether express or implied in any way extending, defining or others relating to the provisions hereof or binding on the parties with respect to any of the matters to which these presents relate”.
The so-called letter of offer as prepared by the lessor expressly provides that it is not an offer which might be accepted with binding consequences. It is subject to the lease. Clause 4.3 in the executed lease contains no ambiguity.
In Denham Brothers v. Freestone Leasing Pty Ltd 2003 QCA 376, the Court of Appeal, per Holmes J, referred to the statement in Chan v. Cresdon Pty Ltd 1989 89 ALR 522, that in the absence of any ambiguity in a lease there was no warrant for looking at the provisions of the agreement for lease for the purposes of construing the lease. Even more so, it might be said, of other pre-contractual documents.
The lessor then must rely on mistake in its various manifestations. I would not wish to pre-empt the matter but Pincus JA in Lendlease Financial Planning Pty Ltd v. Southcorp Pty Ltd CA 8999 of 1997, cited Bryson J in Dellwest Pty Ltd v. Cafabe Pty Ltd of the 29th of November 1997 where his Honour said, “…the law and the Court know no standard clause relating to contributions to outgoings”.
The additional subparagraphs of Clause 4.3 inserted as (c), (d) and (e) to the lease tendered for registration were never expressly set out pre-contractually in material given to the lessee. It is difficult to see what particulars the lessor will be able to make out that, it contends, the lessee knew of or ought to have known.
It was for the lessor to recognise that the amendments were far from minor and when they were resisted to apply to rectify the lease if so advised. Registering the lease it had altered, without consent - indeed in the face of opposition - in so substantial a manner was to say the least rather high-handed. The application for rectification on the morning of the hearing, notwithstanding the background, is too late. The lessor, of course, may pursue rectification as it is advised. I would make the declaration sought and order the lessor to amend the registered lease to reflect the executed lease.
…
HER HONOUR: I am not persuaded that this is a case where indemnity costs are called for. The motive in registering the lease has not really been explored. I have described the conduct as high-handed and I would adhere to that, but that does not seem to call for an order for indemnity costs.
The application for rectification which was made yesterday did not increase the costs of the hearing in any way. All I propose to do with respect to it is to give leave to read and file it. The issues that were raised in argument would have been canvassed in any event. So the lateness and the failure to provide material about that matter has not added to the cost of the hearing and in any event would not in the normal course attract indemnity costs either. But there is no doubt that the applicant has been entirely successful and should have its costs on the standard basis.
The second respondent does have an interest in the application. It was appropriate to make the second respondent a respondent to the application. It is the new owner of the premises. The issue of the caveat is something that has not been argued before me. It has an interest in the status of the lease between the parties although, as Miss Pierce said yesterday, not in any great sum of money.
It was a matter for the second respondent to attend or to simply send a letter abiding the decision of the Court, but it seems to me that it was not inappropriate to attend, particularly in light of the fact that the first respondent was then about to seek rectification of the lease which binds the second respondent and the applicant.
There is no reason why the costs order should not also follow that event. So the order as to costs is that the first respondent pay the applicant's and the second respondent's costs of and incidental to the application for a declaration to be assessed. I make no order as to costs about the application for rectification filed yesterday by leave.
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