Ashton v Hunt

In the case of Ashton v Hunt, the plaintiff, Ashton, sought to recover arrears of rent from the defendant, Hunt, who had acted as a guarantor for his son, the original lessee, under an unregistered lease. The dispute arose from an unregistered five-year lease agreement where Hunt guaranteed his son's obligations. The court was tasked with determining whether the unregistered lease was immediately valid for all purposes between the immediate parties and if the common law duty to pay rent constituted an obligation "under this lease" for the guarantor's liability for arrears of rent.

The primary legal issues were whether the unregistered lease was immediately binding between the parties, and if the guarantor was liable for the arrears of rent under the common law duty. The court examined these issues in light of relevant case law and statutory provisions, specifically section 71 of the Land Title Act 1994. The court considered whether the guarantee extended to the common law duty to pay rent, as per the decision in Chan v Cresdon Pty Ltd.

The court ruled that the unregistered lease was indeed immediately valid for all purposes between the immediate parties, in accordance with the principles established in Chan v Cresdon Pty Ltd. It further held that the guarantor was liable for the arrears of rent as the common law duty to pay rent amounted to an obligation "under this lease" for the purpose of the guarantor's liability. The court's reasoning was grounded in the understanding that the guarantor's liability extends to all obligations arising under the lease, including those established by common law. The court confirmed that section 71 of the Land Title Act 1994 did not alter this outcome.

The final orders of the court mandated that Hunt, as the guarantor, was liable to pay the arrears of rent owed under the lease. The court's decision reinforced the principle that guarantors are bound by all obligations under the lease, including those derived from common law.