JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL
CITATION: BROADWAY PTY LTD -v- LEWIS [2012] WASC 373
CORAM: PRITCHARD J
HEARD: 11, 14 SEPTEMBER 2012
DELIVERED : 9 OCTOBER 2012
FILE NO/S: CIV 2642 of 2010
BETWEEN: BROADWAY PTY LTD TRADING AS FOR THE CRIDDLE FAMILY TRUST
Plaintiff
AND
STEVEN BURNETTE LEWIS
Defendant
Catchwords:
Practice and procedure - Rules of the Supreme Court 1971 (WA) O 34 r 2 - Where the defendant does not appear at the trial - Whether the court should exercise its discretion to proceed with the trial in the absence of the defendant - Considerations relevant to the exercise of the court's discretion
Real property - Action for possession of land - Nature of the action - Relevant principles
Real property - Action for damages for use and occupation of land - Whether the defendant was a tenant at will - Whether the defendant was a tenant at sufferance
Torts - Trespass to land - Action for mesne profits - Whether re-entering into actual possession of the land is a prerequisite to an action for mesne profits - Whether an action for mesne profits can be heard in the same proceedings as an action for possession of land - Consideration of the doctrine of 'trespass by relation'
Legislation:
Civil Judgments Enforcement Act 2004 (WA), s 11(1)(b), s 94, s 95
Common Law Procedure Act 1852 (15 & 16 Vict c 66), s 214
Interpretation Act 1984 (WA), s 73
Landlord and Tenant Act 1899 (NSW), s 12
Limitation Act 1935 (WA), s 38(1)(c)
Residential Tenancies Act 1987 (WA), s 71, s 72
Rules of the Supreme Court 1971 (WA), O 1 rr 4A, 4B, O 8 r 7, O 19,
O 34 rr 2, 4
Supreme Court Act 1928 (Vic), s 132
Supreme Court Act 1958 (Vic), s 119
Result:
Claim allowed in part
Counterclaim dismissed
Category: A
Representation:
Counsel:
Plaintiff: Mr S M Davies SC & Ms K R Lendich
Defendant: No appearance
Solicitors:
Plaintiff: Jackson McDonald
Defendant: In person
Case(s) referred to in judgment(s):
Allen v Roughley (1955) 94 CLR 98
Andrews v Nominal Defendant [1963] NSWR 359
Aon Risk Services Australia Limited v Australian National University (2009) 239 CLR 175
Attorney General v De Keyser's Royal Hotel [1920] AC 508
Australian Provincial Assurance Association Ltd v Rogers (1943) 43 SR (NSW) 202
Baldry v Jackson [1976] 2 NSWLR 415
Bayley v Bradley (1848) 5 CB 396; 136 ER 932
Bentley Smythe Pty Ltd v Anton Fabrications (NSW) Pty Ltd [2011] NSWSC 186
Cameron v Cole (1944) 68 CLR 571
Churchward v Ford (1857) 2 H & N 446
Doe d Bennett v Turner (1840) 7 M & W 226; 151 ER 749
Doe d Heming v Brett (1840) Hurl & W 3, 3
Doe d Jones v Jones (1830) 10 B & C 718; 109 ER 616
Dunlop v Macedo (1891) 8 TLR 43
Ebbels v Rewell [1908] VLR 261
Elliott v Boynton [1924] 1 Ch 236
Eshelby v Federated European Bank Ltd [1932] 1 KB 254
Grainger v Williams [2005] WASC 286
Hampton v BHP Billiton Minerals Pty Ltd [No 2] [2012] WASC 285
Hoskins v Van Den-Braak (1998) 43 NSWLR 290
Howard v Shaw (1841) 8 M & W 118
Individual Homes Pty Ltd (In Liq) v Martin [1999] ACTSC 139
Kay Investment Holdings Pty Ltd v North East Developments Pty Ltd (in liq) (2011) 85 ACSR 610
Leigh v Dickeson (1884) 12 QBD 194
Lewisham LBC v Masterson [2000] 1 EGLR 134
Lollis v Loulatzis [2007] VSC 547
London and Blackwall Railway v Cross (1886) 31 Ch D 354
Mary Alice Hughes by her Tutor NSW Trustee and Guardian v Hughes [2011] NSWSC 729
Minister of State for the Interior v RT Co Pty Ltd (1962) 107 CLR 1
Morgan v Harrison [1907] 2 Ch 137
Morris v Tarrant [1971] 2 QB 143
Natural Gas and Oil Corporation Ltd (In Liq) v Byrne and Boyle (1951) 68 WN (NSW) 207
Nilan v Nilan (1951) 68 WN (NSW) 271
Oliveri v Jones [1999] NSWSC 154
Oliveri v Jones [1999] NSWSC 796
Ovideo Carrideo Nominees Pty Ltd v The Dog Depot Pty Ltd [2006] VSCA 6
Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589
Portland Management Ltd v Harte [1977] 1 QB 306
Re Keystone Knitting Mills' Tradesmark [1929] 1 Ch 92
Remon v City of London Real Property Co [1921] 1 KB 49
Scientific Management Associates (Australia) Pty Ltd and Anor v Australian Capital Territory [1999] ACTSC 17
Simms v Lee [1945] 45 SR (NSW) 352
Simpkin v Ashurst (1834) 1 CM and R 261
Spektor v Lees [1964] VR 10
Stone v Smith (1887) 35 Ch D 188
Taylor v Taylor (1979) 143 CLR 1
Turner v Doe d Bennett (1842) 9 M & W 643; 152 ER 271
Vacuum Oil Pty Co Ltd v Stockdale (1942) 42 SR (NSW) 239
Wilson v Kelly [1957] VR 147
Zegir v Woop [1955] VLR 394
TABLE OF CONTENTS
Introduction
(a) Broadway's case
(b) The matters pleaded in Mr Lewis' Amended Defence and Counterclaim, and Broadway's Reply and Defence to Counterclaim
(c) Mr Lewis' non-attendance at the trial
Some relevant aspects of the history of the litigation
The decision to proceed with the trial, notwithstanding Mr Lewis' failure to attend
The issues in dispute and the parameters of the evidence
The witnesses
Broadway's title to Lots 1490 and 1491, and its relationship with Decmil
Construction of the Fence
The Lease
The Contract
Continued occupation of the disputed land after the settlement and the termination of the Lease
Other matters
(a) Whether an order should be made for possession of the disputed land
(b) Broadway's claim for damages for use and occupation of the disputed land on the basis that Mr Lewis was either a tenant at will or a tenant at sufferance
(i) Was Mr Lewis a tenant at will?
(ii) Was Mr Lewis a tenant at sufferance?
(iii) Quantum of a claim for damages for use and occupation
Broadway's claim for damages for trespass by Mr Lewis on the disputed land
(i) Mesne profits for trespass at common law
(ii) Statutory modifications of the common law position
(iii) The position in Western Australia
(iv) The submission by counsel for Broadway as to how mesne profits could be pursued in these proceedings
(v) A contrary authority
(vi) Conclusion
The relief sought by Broadway
(a) The orders which should be made
(b) Whether there should be an order for an injunction to compel the removal of chattels
(c)Whether an order should be made under s 95 of the CJE Act
PRITCHARD J:
Introduction
This action arises from a dispute between Broadway Pty Ltd (Broadway) and Mr Steven Lewis concerning the possession of land in Karratha.
Lots 1490 and 1491 Lambert Road in the Karratha Industrial Estate in Karratha are adjacent lots of land.[1] Lot 1491 is on the eastern side of Lot 1490. Broadway is the registered proprietor of Lot 1490 and Mr Lewis is the registered proprietor of Lot 1491. A fence divides the two Lots (the Fence). The Fence is not situated on the boundary between the two Lots, but rather is situated inside the boundary, on Lot 1490.[2]
[1] Lot 1490 is more particularly described as Lot 1490 on Deposited Plan 213939 being the whole of the land in certificate of title volume 2124 folio 64. Lot 1491 is more particularly described as Lot 1491 on Deposited Plan 213939 being the whole of the land in certificate of title volume 1927 folio 139.
[2] See paragraphs 2 – 5 of the Further Re-Amended Statement of Claim dated 6 September 2012 and paragraphs 1 and 2 of the Amended Defence and Counterclaim dated 14 August 2012.
The land the subject of the dispute is that part of Lot 1490 which lies between the Fence and the boundary between the two Lots (the disputed land). The disputed land is 1164 square metres in area.[3]
[3] Exhibit H, witness statement of Glenn Bush, dated 13 September 2012, Annexure GB-2.
In approximately 2003, Broadway leased Lot 1491, together with the disputed land, to Mr Lewis and his then partner, Ms Kathryn Burchnell (the Lease).[4]
[4] See paragraph 6 of the Further Re-Amended Statement of Claim dated 6 September 2012 and paragraph 3 of the Amended Defence and Counterclaim dated 14 August 2012.
On 18 January 2005, Broadway entered into a contract with Mr Lewis and Ms Burchnell for the sale of Lot 1491 (the Contract). Settlement of the transfer of Lot 1491 was effected on 2 March 2005, and the Lease terminated on the same date.[5]
[5] See paragraph 9 of the Further Re-Amended Statement of Claim dated 6 September 2012 and paragraphs 1 and 5 of the Amended Defence and Counterclaim dated 14 August 2012.
In late 2006 or early 2007, Mr Lewis' relationship with Ms Burchnell came to an end. On 10 November 2009, Mr Lewis became the sole registered proprietor of Lot 1491.[6]
[6] See paragraph 11 of the Further Re-Amended Statement of Claim dated 6 September 2012 and paragraph 1 of the Amended Defence and Counterclaim dated 14 August 2012.
Since 2 March 2005, there has been a dispute between Broadway and Mr Lewis in relation to the disputed land. Broadway's case is that it is the owner of the disputed land and that, since at least 10 November 2009, Mr Lewis had no entitlement to occupy the disputed land. Broadway seeks an order for the recovery of possession of the disputed land, together with damages for the use and occupation of the disputed land on the grounds that Mr Lewis was a tenant at will or a tenant at sufferance, or damages for trespass by Mr Lewis on the disputed land. It seeks those damages only from 10 November 2009 (which was the date on which Mr Lewis became the sole registered proprietor of Lot 1491) to the present. Broadway also seeks various related orders which are outlined below.
It appears that Mr Lewis' view is that he and Ms Burchnell reached an agreement with Broadway for the sale of Lot 1491 together with the disputed land and that, as a result of a mistake common to all parties, the Contract did not reflect the entirety of the terms of the parties' agreement.[7] Alternatively, it appears that Mr Lewis' view is that Mr Denis Criddle, a director of Broadway, represented to Mr Lewis and Ms Burchnell that the disputed land was also being sold pursuant to the Contract, that Mr Lewis and Ms Burchnell relied on that representation and entered into the Contract, and that Broadway knew or ought to have known of the mistaken belief, and did nothing to correct that mistaken belief.[8]
[7] See paragraphs 8 and 9 of the Amended Defence and Counterclaim dated 14 August 2012.
[8] See paragraphs 3 and 11 of the Amended Defence and Counterclaim dated 14 August 2012.
In these reasons, I have referred to what Mr Lewis' view of the situation appears to have been. That this was his view can be discerned from the Amended Defence and Counterclaim Mr Lewis filed in the action. However, Mr Lewis did not personally appear at the trial, nor was he represented by counsel. At the commencement of the trial, I decided that the trial should proceed notwithstanding Mr Lewis' failure to appear. I have set out my reasons for that decision below.
For the reasons set out below, Broadway is entitled to an order for possession in respect of the disputed land. However, Broadway has not established, on the balance of probabilities, that Mr Lewis was either a tenant at will or a tenant at sufferance, so as to establish an entitlement to damages for use and occupation of the disputed land by Mr Lewis since 10 November 2009. Further, it is not open to Broadway to pursue damages for trespass in the same action as its action for possession of the disputed land.
These reasons deal with the following matters:
(a)Broadway's case;
(b)The matters pleaded in Mr Lewis' Amended Defence and Counterclaim, and Broadway's Reply and Defence to Counterclaim;
(c)Mr Lewis' non-attendance at the trial;
(d)The evidence;
(e)Whether an order should be made for possession of the disputed land;
(f)Broadway's claim for damages for use and occupation of the disputed land on the basis that Mr Lewis was either a tenant at will or a tenant at sufferance;
(g)Broadway's claim for damages for trespass by Mr Lewis on the disputed land;
(h)Other relief sought by Broadway.
(a) Broadway's case
I have already referred to the part of Broadway's pleadings, much of which was not in dispute. The balance of its case is that from 20 March 2005 to 10 November 2009, and notwithstanding the termination of the Lease, Mr Lewis and Ms Burchnell occupied the disputed land and refused to allow Broadway access to the disputed land. Broadway claims that throughout this period, Mr Lewis and Ms Burchnell, or a third party with their consent, kept machinery, vehicles and equipment on the disputed land.[9]
[9] See paragraph 10 of the Further Re-Amended Statement of Claim dated 6 September 2012.
Broadway claims that on several occasions between 2 March 2005 and September 2005, fencing contractors engaged by Broadway to construct a fence on the boundary between Lots 1490 and 1491 requested access to the disputed land, which was denied by Mr Lewis.[10]
[10] See paragraph 10 of the Further Re-Amended Statement of Claim dated 6 September 2012.
Broadway claims that from 10 November 2009 to the present, Mr Lewis has occupied the disputed land and refused to vacate the disputed land. Broadway pleaded that Mr Lewis, or alternatively, a third party with his authority, continues to keep machinery, vehicles and equipment on the disputed land.[11]
[11] See paragraph 12 of the Further Re-Amended Statement of Claim dated 6 September 2012.
These matters were all denied by Mr Lewis in his Amended Defence and Counterclaim.[12]
[12] See paragraph 6 of the Amended Defence and Counterclaim dated 14 August 2012.
Broadway claims that on or about 25 August 2010, it gave written notice to Mr Lewis to vacate the disputed land by 6 September 2010, and that on or about 23 September 2010, it gave written notice to Mr Lewis to vacate the disputed land by 6 October 2010.[13] Mr Lewis admits that these notices were given.[14] He also admits that he failed to comply with the notices.[15]
[13] See paragraphs 13 and 14 of the Further Re-Amended Statement of Claim dated 6 September 2012.
[14] See paragraph 5 of the Amended Defence and Counterclaim dated 14 August 2012.
[15] See paragraph 5 of the Amended Defence and Counterclaim dated 14 August 2012.
Broadway claims that from about 10 November 2009 there was an implied agreement between it and Mr Lewis that in respect of the disputed land, Mr Lewis would be a tenant at will and would pay for use and occupation of the disputed land.[16] In the alternative, Broadway claims that from about 10 November 2009 Mr Lewis was a tenant at sufferance.[17]
[16] See paragraph 12A of the Further Re-Amended Statement of Claim dated 6 September 2012.
[17] See paragraph 12B of the Further Re-Amended Statement of Claim dated 6 September 2012.
Broadway claims that by reason of Mr Lewis' conduct, it has been unable to use and enjoy the disputed land, and has thereby suffered loss and damage. It particularises that loss and damage as being the fair letting value of the disputed land for the period from 10 November 2009 to date, at $20 per square metre per annum, over the total area of the disputed land of 1164 square metres.[18]
[18] See paragraph 16 of the Further Re-Amended Statement of Claim dated 6 September 2012. In the course of the hearing, however, counsel particularised Broadway's claim as $10 per square metre for the period 10 November 2009 to 30 June 2010, and $20 per square metre for the period 1 July 2010 to date.
Broadway's second alternative claim at trial was that Mr Lewis was a trespasser.[19] It seeks damages for that trespass.
[19] A plea of trespass was in fact deleted in an earlier amendment to the Statement of Claim.
In its prayer for relief, Broadway claims an order for recovery of possession of the disputed land, a declaration that Mr Lewis has no legal or equitable interest in Lot 1490, an injunction requiring Mr Lewis to immediately remove all chattels in his possession and control from Lot 1490, damages for the use and occupation of the disputed land from 10 November 2009 to date; further or alternatively, damages for trespass during the same period, interest on damages and costs. However, in the course of the hearing, counsel for Broadway informed the Court that his client did not press for a declaration in the terms sought in the prayer for relief.
Mr Lewis denies that Broadway is entitled to the relief sought or to any relief.[20]
[20] Paragraph 7 of the Amended Defence and Counterclaim dated 14 August 2012.
In addition, in the course of the trial, counsel for Broadway also sought an additional order, which was, in effect, an order pursuant to s 95 of the Civil Judgments Enforcement Act 2004 (WA) (the CJE Act).
(b) The matters pleaded in Mr Lewis' Amended Defence and Counterclaim, and Broadway's Reply and Defence to Counterclaim
In addition to the admissions and denials to which I have already made reference, Mr Lewis' Amended Defence and Counterclaim raised six issues. For completeness, I set out Mr Lewis' claims, together with Broadway's responses thereto.
First, Mr Lewis pleaded that in relation to the Lease, Broadway represented that the disputed land was entirely within the bounds of Lot 1490 (the Lease Representation). The Lease Representation was said to have been made in or about September 2003 during a meeting on the disputed land between Mr Criddle, acting on behalf of Broadway, and Mr Lewis. The Lease Representation was said to have been to the effect that the Fence was on the boundary between Lots 1490 and 1491.[21] Broadway denies that any such representation was made.[22]
[21] See paragraph 3 of the Amended Defence and Counterclaim dated 14 August 2012.
[22] See paragraph 1 of the Reply and Defence to Counterclaim dated 23 August 2012.
Secondly, Mr Lewis pleaded that during the course of negotiations concerning the Contract, Mr Lewis and Ms Burchnell met with Mr Criddle at his office in South Perth and, during the course of that meeting, Mr Criddle, on behalf of Broadway, offered to sell Lot 1491 and the disputed land. Mr Lewis also pleaded that the written Contract did not reflect the agreement reached between them and Broadway, in that only Lot 1491 was included in its terms, rather than Lot 1491 and the disputed land.[23] Broadway denies that the negotiations between Broadway, Mr Lewis and Ms Burchnell concerned the disputed land and says that the negotiations pertained only to the purchase of Lot 1491.[24]
[23] See paragraph 4 of the Amended Defence and Counterclaim dated 14 August 2012.
[24] See paragraph 2 of the Reply and Defence to Counterclaim dated 23 August 2012.
Furthermore, Broadway pleaded that on five occasions between late 2003 and early March 2005, Mr Denis Criddle, on behalf of Broadway, advised Ms Burchnell, on her own behalf and on behalf of Mr Lewis, that the Fence was not on the boundary between Lots 1490 and 1491 and that the Fence would have to be moved.[25] In addition, Broadway pleaded that in late 2004, it commissioned a survey of Lots 1490 and 1491 and that in the course of that survey, pegs were installed on the boundary between the two Lots,[26] that a proposed Contract sent by Mr Lewis and Ms Burchnell to Broadway attached a diagram showing the boundary between Lots 1490 and 1491,[27] and that in about early February 2005, Broadway caused fencing contractors to attend at Lots 1490 and 1491 to move the Fence to the correct boundary but Mr Lewis refused them access to do so.[28] In addition, Broadway pleaded that in about February 2005, and prior to settlement, Ms Burchnell told Mr Lewis that the Fence was not on the boundary between Lots 1490 and 1491 and had to be moved.[29] Broadway's case was that by virtue of each of these events (the notifications), it was made clear to Mr Lewis that the Fence was not on the boundary between Lots 1490 and 1491.
[25] See paragraph 2(a), (b), (d), (g) and (j) of the Reply and Defence to Counterclaim dated 23 August 2012.
[26] See paragraph 2(c) of the Reply and Defence to Counterclaim dated 23 August 2012.
[27] See paragraph 2(f) of the Reply and Defence to Counterclaim dated 23 August 2012.
[28] See paragraph 2(i) of the Reply and Defence to Counterclaim dated 23 August 2012.
[29] See paragraph 2(h) of the Reply and Defence to Counterclaim dated 23 August 2012
Thirdly, in his Counterclaim, Mr Lewis pleaded that it was the common intention of Broadway, Mr Lewis and Ms Burchnell that Broadway would sell Lot 1491 and the disputed land to Mr Lewis and Ms Burchnell, and that the fact that the Contract did not refer to the transfer of all of that land was a consequence of a mistake common to all of the parties.[30] Broadway denies these allegations and relies on the notifications to refute the allegation of common mistake.[31]
[30] See paragraphs 8 and 9 of the Amended Defence and Counterclaim dated 14 August 2012.
[31] See paragraph 4 and 5 of the Reply and Defence to Counterclaim dated 23 August 2012.
Fourthly, and in the alternative, in his Counterclaim, Mr Lewis pleaded that he and Ms Burchnell held the mistaken belief that the Contract dealt with Lot 1491 and the disputed land, and that in view of the Lease Representation, Broadway knew or ought to have known of that mistaken belief on the part of Mr Lewis and Ms Burchnell, but did nothing to correct that mistaken belief, and that by entering into the Contract, Mr Lewis suffered detriment.[32] Broadway denies these allegations and relies on the notifications both to refute the allegation that Mr Lewis and Ms Burchnell were operating under a mistaken belief, and as conduct which corrected, or ought to have corrected, any alleged mistaken belief.[33]
[32] See paragraph 11 of the Amended Defence and Counterclaim dated 14 August 2012.
[33] See paragraph 7 of the Reply and Defence to Counterclaim dated 23 August 2012.
Fifthly, and in the alternative, Mr Lewis pleaded that Broadway's conduct in the circumstances was unconscionable conduct.[34] Broadway denies this allegation.[35]
[34] See paragraph 13 of the Amended Defence and Counterclaim dated 14 August 2012.
[35] See paragraph 9 of the Reply and Defence to Counterclaim dated 23 August 2012.
Sixthly, and in the alternative, Mr Lewis pleaded that by its conduct, Broadway represented that the Contract would effect the sale of Lot 1491 and of the disputed land to Mr Lewis and Ms Burchnell, that Mr Lewis acted in reliance on that representation and entered into the Contract, and thereby suffered detriment, and that in those circumstances, Broadway was estopped from maintaining that the Contract only effected the sale of Lot 1491.[36] Broadway denied all of these allegations, and again pointed to the notifications in answer to them.[37]
[36] See paragraphs 15 - 17 of the Amended Defence and Counterclaim dated 14 August 2012.
[37] See paragraphs 11 and 12 of the Reply and Defence to Counterclaim dated 23 August 2012
The relief sought by Mr Lewis in the Amended Defence and Counterclaim was an order that the Contract be rectified to include the disputed land, a declaration that Broadway holds the disputed land on trust for Mr Lewis, and an order that upon and subject to the registration of a plan of subdivision in respect of the disputed land, Broadway transfer the disputed land to Mr Lewis.[38]
[38] See paragraphs 10, 12, 14 and paragraphs A, B and C of the prayer for relief in the Amended Defence and Counterclaim dated 14 August 2012.
Broadway denied that Mr Lewis is entitled to the relief sought, or to any relief, and in addition, as to the claims for rectification and a declaration that the disputed land is held on trust, pleaded that the claims are barred by analogy with s 38(1)(c)(v) or s 38(1)(c)(vi) of the Limitation Act 1935 (WA).[39] In addition, Broadway pleaded that relief should be denied to Mr Lewis on the ground of laches on Mr Lewis' part.[40]
(c) Mr Lewis' non-attendance at the trial
[39] See paragraphs 6, 8, 10, 14 and 16 of the Reply and Defence to Counterclaim dated 23 August 2012.
[40] See paragraph 15 of the Reply and Defence to Counterclaim dated 23 August 2012.
As I have already indicated, Mr Lewis did not appear at the trial. Counsel for Broadway sought to continue in Mr Lewis' absence. Rather than adjourn the trial to a later date, I determined that the trial should proceed notwithstanding Mr Lewis' absence. As I indicated at the commencement of the trial, I permitted the trial to proceed not least of all because I was satisfied that Mr Lewis had been provided with notice of the dates of the trial, and of the implications for his case if he failed to attend. In reaching the view that the trial should proceed, I also took into account Broadway's position, the position of witnesses in the trial, and case management objectives, all of which militated against adjourning the trial for what would have been the second time. It is appropriate to set out those matters in full in these reasons. First, however, it is necessary to outline some relevant aspects of the history of this litigation.
Some relevant aspects of the history of the litigation
This action was commenced on 15 October 2012. On 13 March 2012, the action was listed for a trial commencing on 7 August 2012, and orders were made for the filing of various documents (including witness statements, documents to be tendered and so on) in preparation for trial (the trial directions). On 8 May 2012, an order was made pursuant to O 8 r 7 of the Rules of the Supreme Court 1971 (WA) (the RSC) declaring that Mr Lewis' then solicitors ceased to act for him. By that time, Mr Lewis had not complied with the trial directions made on 13 March 2012.
A directions hearing was held on 29 May 2012, at which Mr Lewis appeared in person (by telephone), and orders were made (the revised trial directions) varying the time for compliance with the trial directions made on 13 March 2012. On that occasion, I emphasised to Mr Lewis the need for him to comply with the revised trial directions in preparation for the trial on 7 August 2012.
Following non-compliance by Mr Lewis with the revised trial directions, Broadway applied for orders striking out Mr Lewis' Defence and Counterclaim and for an order that judgment be entered for Broadway. That application was listed for hearing on 30 July 2012.
However, on 27 July 2012, solicitors for Mr Lewis filed an application to vacate the trial dates. That application was heard on 31 July 2012. Broadway opposed that application. On 31 July 2012 I vacated the trial dates, but on the basis that the Court was able to re-list the matter for trial commencing on 11 September 2012. An order was made provisionally listing the matter for a trial commencing on that date. (The trial was provisionally listed for 11 September 2012 because counsel for Mr Lewis indicated that it would be necessary to amend the Defence and Counterclaim, and it appeared that this might have implications for Broadway's case, and its preparation for trial.)
On 9 August 2012, orders were made extending the time within which Mr Lewis was required to file and serve his Amended Defence and Counterclaim. On 16 August 2012, orders were made varying the time for compliance with the revised trial directions (the further trial directions).
On 29 August 2012, Mr Lewis' then solicitors applied for an order pursuant to O 8 r 7 RSC, declaring that they had ceased to act for him. On that date, I adjourned the application for hearing on 4 September 2012, but ordered that Mr Lewis' solicitors serve Mr Lewis by facsimile with their application, and give Mr Lewis notice of all outstanding court orders with which he was required to comply. I ordered that service of that documentation be effected by post and facsimile, to ensure Mr Lewis was advised of the application, of the implications for him of an order that his solicitors ceased to act, and to make clear to Mr Lewis that the trial was listed for hearing on 11 September 2012. The affidavit of service filed by Mr Lewis' then solicitors annexed a copy of a letter to Mr Lewis which expressly noted that the trial was listed for hearing on 11 September 2012.
On 29 August 2012, I also made an order confirming the provisional trial dates of 11 ‑ 14 September 2012. On 4 September 2012, I made orders requiring Broadway to serve all further documentation on Mr Lewis by email and by post to two separate postal addresses. Affidavits filed by the solicitors for Broadway since then have indicated that Mr Lewis was served by email, post and facsimile with all documentation subsequently filed by Broadway (which included its Further Re‑Amended Statement of Claim, further witness statements and outlines of submissions).
On 5 September 2012, I made an order declaring that Mr Lewis' then solicitors had ceased to act for him.
For completeness, I note that at the commencement of the trial, counsel for Broadway advised the Court that he was instructed that his instructing solicitors had not received any recent communication from Mr Lewis in relation to the trial.
The decision to proceed with the trial, notwithstanding Mr Lewis' failure to attend
Order 34 r 2 RSC provides that if, when a trial is called on, one party does not appear the judge may proceed with the trial of the action in the absence of that party. Clearly, the Court has a discretion as to whether to proceed with or adjourn the trial.[41] In my view, two fundamental considerations govern the exercise of the Court's discretion. The first is that natural justice must be afforded to a party to litigation. The second, and related, consideration is that the paramount objective of litigation is the just resolution of disputes.
[41] The discretion to adjourn a trial is expressly conferred by O 34 r 4 RSC. Similar provisions exist in other jurisdictions. See, for example, pt 29 r 7 of the Uniform Civil Procedure Rules 2005 (NSW), and see the discussion in Bentley Smythe Pty Ltd v Anton Fabrications (NSW) Pty Ltd [2011] NSWSC 186 [11] – [15] (Ward J); Kay Investment Holdings Pty Ltd v North East Developments Pty Ltd (in liq) (2011) 85 ACSR 610 [28] – [30] (Ward J) and Mary Alice Hughes by her Tutor NSW Trustee and Guardian v Hughes [2011] NSWSC 729 [3] – [7] (Gzell J).
As to the requirement to afford natural justice, Rich J observed[42] (albeit in a somewhat different factual context):
It is a fundamental principle of natural justice, applicable to all courts whether superior or inferior, that a person against whom a claim or charge is made must be given a reasonable opportunity of appearing and presenting his case. If this principle be not observed, the person affected is entitled, ex debito justitiae, to have any determination which affects him set aside; and a court which finds that it has been led to purport to determine a matter in which there has been a failure to observe the principle has inherent jurisdiction to set its determination aside. (citations omitted)
[42] Cameron v Cole (1944) 68 CLR 571, 589; see also Taylor v Taylor (1979) 143 CLR 1 at 8 (Gibbs J); Hoskins v Van Den-Braak (1998) 43 NSWLR 290, 294 (Mason P, Priestley and Beazley JJA agreeing).
In this case, having regard to the fact that Mr Lewis was represented by a solicitor from about 27 July 2012 to 29 August 2012, and the content of correspondence sent by his then solicitors to Mr Lewis in relation to their application under O 8 r 7 RSC (to which I have referred above), I was satisfied that Mr Lewis was made aware that the trial of this action was listed for hearing commencing on 11 September 2012. I was also satisfied that Mr Lewis was made aware of the implications for his case if he failed to attend the hearing of the trial.[43]
[43] In any event, there is some authority for the proposition that if a defendant fails to appear at a trial, it is not necessary to prove that notice of trial has been given: Vacuum Oil Pty Co Ltd v Stockdale (1942) 42 SR (NSW) 239, 242 (Jordan CJ).
No application was made by, nor received from, Mr Lewis for an adjournment of the trial, nor did the Court receive any notification that Mr Lewis was unable to attend the trial for some reason (for example, ill health).
Furthermore, Mr Lewis' conduct of this litigation has been somewhat inconsistent. On the one hand, at the point when Broadway applied to strike out Mr Lewis' defence and to have judgment entered in its favour, Mr Lewis instructed solicitors to appear on his behalf, and to seek a very late adjournment of the trial (which was then listed to commence on 7 August 2012). On the other hand, apart from the filing of the Amended Defence and Counterclaim, Mr Lewis did not comply with any of the trial directions, revised trial directions, or further trial directions. In other words, this was not a case where a party had actively defended litigation throughout, and yet without any explanation, failed to appear at the trial. In such a case, the unexpected failure of a party to appear might warrant further enquiries before a decision were made as to whether to proceed with the trial.
However, in the circumstances of this case, I was satisfied that Mr Lewis had been given a reasonable opportunity to prepare and present his case and that he had not availed himself of that opportunity. Nor did Mr Lewis advise the Court of any matter which prevented him from doing so and which might have warranted the adjournment of the trial.
As for the second consideration – the fundamental objective of the just resolution of disputes – in considering whether a dispute can be justly resolved if one of the parties to the dispute fails to appear at the trial, the position of that party cannot be the sole consideration. That much is clear from the very fact that O 34 r 2 RSC permits the trial to proceed in the absence of a party to the proceedings. In the present case, apart from the position of Mr Lewis, the position of Broadway as a litigant, the position of third parties (that is, witnesses), and more general considerations relating to the modern approach to case management, were relevant to the decision whether to proceed with the trial.
As to the position of Broadway, counsel for Broadway submitted that the trial should proceed, notwithstanding Mr Lewis' absence. Broadway was clearly ready to proceed with the trial and, moreover, it was ready to do so in circumstances where the trial dates had already been vacated, at short notice, once before.
As to the position of third parties, it was apparent that there were witnesses who were going to be called by Broadway at the trial. Any adjournment of the trial would necessarily have caused inconvenience to them.
Finally, a further adjournment of the trial in this case, in circumstances where Mr Lewis had not attended at the trial, nor applied for such an adjournment, and when Broadway sought to proceed with the trial, would not have been consistent with the objects of the positive system of case flow management which apply in this Court.[44] The system of positive case flow management in accordance with which litigation is managed in this Court pursuant to O 1 r 4B RSC has, as its objects, promoting the just determination of litigation, disposing efficiently of the business of the Court, maximising the efficient use of available judicial and administrative resources, and facilitating the timely disposal of business (amongst others).
[44] Cf Aon Risk Services Australia Limited v Australian National University (2009) 239 CLR 175.
The present action was commenced in 2010, and relates to events which occurred in 2005. The issues are relatively short in compass. A second adjournment of the trial in the circumstance I have described would not have facilitated the timely disposition of the litigation. In our adversarial legal system, it is eminently desirable that a trial involve the active participation of all of the parties to the litigation. However, if a party does not participate, that cannot preclude the resolution of the litigation at the trial.
The issues in dispute and the parameters of the evidence
Mr Lewis' failure to attend the trial was unfortunate because it meant that the Court had to resolve a long-running dispute between Broadway and Mr Lewis without Mr Lewis' active participation. In addition, Mr Lewis' absence necessarily had practical implications.
On the face of the pleadings, many of the material facts, particularly those relating to that part of the action which involved the claim for an order for possession, were admitted. There were nevertheless some factual matters which, on the pleadings, were in dispute. In the absence of a defendant, a plaintiff must still prove his or her claim so far as the burden of proof rests upon him or her.[45] However, Mr Lewis' absence meant that the Court did not have before it any evidence that he may have been able to adduce to contradict or test the material facts on which Broadway relied in support of its claims.
[45] Stone v Smith (1887) 35 Ch D 188, 190 (Kekewich J).
In addition, no evidence was adduced by Mr Lewis in support of the matters raised in his Amended Defence and Counterclaim. As the Court can only determine the issues raised by the pleadings on the basis of the evidence before it, Mr Lewis' failure to appear and call evidence meant that the claims in his Counterclaim necessarily failed.
Consequently, the evidence led at the trial was confined in its scope. Broadway called four witnesses at the trial and statements or affidavits of their evidence were tendered in evidence. Mr Lewis' failure to attend at the trial meant that the evidence of these witnesses was not contested, and, as there was nothing else which cast doubt on their evidence, I accept that evidence.
Finally, the Court did not have the benefit of any submissions which Mr Lewis (or counsel on his behalf) may have been able to advance in opposition to those made on behalf of Broadway in relation to some of the contentious legal questions raised by the pleadings.
The witnesses
The witnesses called by Broadway were Mr Denis Criddle (a director of Broadway since 1989), Mr Scott Criddle (the son of Mr Denis Criddle, and who is the Chief Executive Officer of Decmil Group Limited, the Managing Director of Decmil Australia Pty Ltd, and who was a director of Broadway from 9 March 2000 to 30 March 2010), Ms Kathryn Burchnell (who was the de facto partner of Mr Lewis from late 2001 to 2006) and Mr Glenn Bush (a licensed surveyor employed by Whelans (WA) Pty Ltd who surveyed Lots 1490 and 1491 in September 2010).
Before turning to my findings in relation to the matters raised in Broadway's Further Amended Statement of Claim, it is appropriate to complete an overview of the background facts, most of which were not in dispute.
Broadway's title to Lots 1490 and 1491, and its relationship with Decmil
Broadway became the registered proprietor of Lot 1491 on 4 May 1992, and the registered proprietor of Lot 1490 on 7 April 1998.
Until July 2007, Broadway owned a majority shareholding in Decmil Australia Pty Ltd, which operated a business trading as Decmil Australia, providing engineering, construction, maintenance and industrial services to the mining industry.[46] Decmil Australia operated from Lot 1490 from about 2000, and operated from Lot 1491 from about 1978 to 2000.[47]
[46] Exhibit B, affidavit of Denis Criddle, sworn 11 July 2012, Annexure DRC-A [2].
[47] Exhibit B, affidavit of Denis Criddle, sworn 11 July 2012, Annexure DRC-A [20].
From July 2007, Decmil Australia Pty Ltd was wholly owned by a public company, Decmil Group Limited.[48]
[48] Exhibit B, affidavit of Denis Criddle, sworn 11 July 2012, Annexure DRC-A [3]..
Since at least 1 July 2008, Decmil Australia Pty Ltd has leased Lot 1490 (other than the disputed land) from Broadway.[49]
Construction of the Fence
[49] Exhibit C. witness statement of Scott Criddle, dated 7 September 2012 [5].
Mr Denis Criddle gave evidence that in the early 1980s, a company of which he was a shareholder at the time (Silla Careba Pty Ltd) was the registered proprietor of Lot 1491. At that time, there was no fence between Lot 1490 and Lot 1491 and the two Lots were treated as one area for business operations.
The Fence was constructed in about early 2000, by Decmil Australia personnel. There was no direct evidence about the circumstances in which the Fence came to be constructed, but Mr Denis Criddle understood the Fence to have been erected not to mark out the boundary between the two Lots, but as a temporary measure to secure the active part of the Lots where plant and equipment were kept.
The Lease
From April 2003, Mr Lewis and Ms Burchnell were directors of Blackthorn Holdings Pty Ltd (Blackthorn), which traded as Norwestar Earthmoving Contractors in Karratha (the business). Blackthorn required space to store its equipment and vehicles, and it appears that Mr Lewis and Ms Burchnell entered into the Lease for that purpose. It was, however, admitted by Mr Lewis that the Lease was entered into between Broadway, on the one hand, and Mr Lewis and Ms Burchnell (and not Blackthorn) on the other hand.[50]
[50] Paragraph 3 of the Amended Defence and Counterclaim dated 14 August 2012.
It was admitted by Mr Lewis that the Lease applied to Lot 1491 and the disputed land.[51] The Lease of Lot 1491 and the disputed land constituted the first lease of that land by Broadway.
[51] The Amended Defence and Counterclaim also pleads that Broadway represented that the disputed land was within Lot 1490 and that the Fence was on the boundary between the two Lots.
The Lease was not recorded in a formal document. Its terms were agreed between Mr Denis Criddle and Ms Burchnell in a telephone conversation in September 2003,[52] and were confirmed in a letter from Ms Burchnell to Decmil Australia.[53] The Lease provided for a term of 12 months, with an option for Mr Lewis and Ms Burchnell to purchase Lot 1491 upon the expiration of the Lease.
[52] Exhibit B, affidavit of Denis Criddle, sworn 11 July 2012, Annexure DRC-A [28].
[53] The letter was written on Blackthorn's letterhead. See Exhibit D, affidavit of Kathryn Burchnell, sworn 19 July 2012, Annexure KEB-C.
Mr Lewis admitted that the Lease terminated on 2 March 2005 when settlement of the sale of the land the subject of the Contract took place (the settlement).[54]
The Contract
[54] Paragraphs 1 and 5 of the Amended Defence and Counterclaim dated 14 August 2012.
The Contract entered into on 18 January 2005 by Broadway, as the seller, and Mr Lewis and Ms Burchnell, as the buyers, was set out in writing. The Contract indicated that the property the subject of the Contract was Lot 1491. That was admitted by Mr Lewis. It was also admitted by Mr Lewis that the Contract attached a diagram of Lots 1490 and 1491.[55]
[55] Paragraph 4 of the Amended Defence and Counterclaim dated 14 August 2012.
A copy of the Contract, including the diagram attached to it, was tendered in evidence. The diagram attached to the Contract indicates that the boundary between Lots 1490 and 1491 runs approximately parallel to the eastern boundary of Lot 1491. In contrast, as it approaches the southern boundary of Lot 1490, the Fence runs at an angle away from the boundary with Lot 1491 and into Lot 1490.
The parties to the Contract executed a transfer of land form which identified the land the subject of the transfer as Lot 1491. A copy of the transfer of land form was tendered in evidence.[56]
Continued occupation of the disputed land after the settlement and the termination of the Lease
[56] Exhibit 1, tab 8.
After the settlement and the termination of the Lease, Mr Lewis and Ms Burchnell remained in occupation of the disputed land. Ms Burchnell stated that from the commencement of the Lease, Mr Lewis had parked trucks and placed materials up against the Fence, and that these items remained where they were after the settlement.[57] Photographs of the disputed land, which were tendered in evidence, also depict vehicles, machinery and equipment located on the land.[58]
Other matters
[57] Exhibit D, affidavit of Kathryn Burchnell, sworn 19 July 2012, Annexure KEB-A [32].
[58] Exhibit F.
For completeness, I note that there was evidence that in the early 1980s Silla Careba Pty Ltd constructed an office building and a concrete wash pad (which was apparently used for washing down vehicles) on Lot 1491.[59] A survey of the Lots was undertaken by Mr Glenn Bush, of Whelans, in 2010. A copy of that survey was in evidence, and showed that those structures were still in place.[60] The evidence was that the parapet wall of the office building encroaches across the boundary and into Lot 1490 by a small margin (of less than 50 centimetres)[61] and that the concrete pad also encroaches across the boundary and into Lot 1490. There was also evidence that a shed had been constructed in more recent times which also encroached across the boundary and into Lot 1490 by a small margin.[62]
[59] Exhibit B, affidavit of Denis Criddle, dated 11 July 2012, Annexure DRC-A [17] - [18], ts 77 - 78 (Mr Denis Criddle).
[60] Exhibit H, witness statement of Glenn Bush, dated 13 September 2012, Annexure GB2.
[61] ts 77 (Mr Denis Criddle); Exhibit H, witness statement of Glenn Bush, dated 13 September 2012, Annexure GB2.
[62] ts 78 (Mr Denis Criddle).
Counsel for Broadway advised the Court that Broadway did not rely on the incursion of these structures on the disputed land to establish its claim that Mr Lewis was a tenant at will or at sufferance, or a trespasser, in relation to Lot 1490, nor did Broadway seek any relief in respect of these structures in these proceedings. Rather, Broadway's case, and the relief sought, was confined to the presence on the disputed land of various items of vehicles, machinery and plant.
(a) Whether an order should be made for possession of the disputed land
The primary aspect of Broadway's action is an action for the recovery of possession of land, or what historically has been more commonly referred to as an action of ejectment.[63] In Commonwealth v Anderson,[64] Menzies J explained that:
Although it is trite to say so, it is important to remember that ejectment is not so called because it is a process whereby a plaintiff seeks to have the defendant ejected from his land. It got its name because it was an action in which the claimant complained that he had been wrongly ejected by the defendant from land of which he was rightfully possessed.
[63] See the discussion of the development of the action for ejectment in Wonnacott M, Possession of Land (2006) 20 – 22 and Sappideen C and Vines P (eds), Fleming's The Law of Torts (10th ed, 2011) 58 - 60 [3.90] – [3.100].
[64] (1960) 105 CLR 303 at 320.
The action for the recovery of land is one by which a person who is not in possession of an estate in land claims that he or she should be put into possession of it.[65] (Used in this sense, to be 'in possession' of an estate in land means that the person with an estate in land is, as a fact, enjoying the rights and incidents of that estate in land.[66]) Accordingly, the action for recovery of land 'is never an action in which the claimant is simply asking to be put into physical occupation of tangible land, albeit that the judgment may often be enforced in that way'.[67]
[65] Wonnacott M, Possession of Land (2006) 20.
[66] Wonnacott M, Possession of Land (2006) 3.
[67] Wonnacott M, Possession of Land (2006) 19.
In this State, legislation governs the recovery of possession of residential properties in situations where tenants hold over after the termination of a residential tenancy.[68] However, neither statute nor the RSC prescribe the requirements of, or procedures for, actions for the recovery of possession in other cases.[69] There is also a dearth of authority from this State in relation to actions for possession of non-residential properties.
[68] See s 71 and s 72 of the Residential Tenancies Act 1987 (WA).
[69] Cf the discussion of the rules and forms applicable to such claims in the United Kingdom in Bullen and Leake and Jacob's Precedents of Pleadings (17th ed, 2012) 1674 - 1677 [98-02].
The relevant principles are nevertheless well established. In order to succeed in an action for possession, a plaintiff who is out of possession must prove that he or she is entitled, as against the defendant, to immediate possession of the land.[70] When the action is pursued by a person claiming ownership of the land, then if the defendant to that action seeks to resist the claim, but accepts the plaintiff's ownership, or if the court finds on the evidence that the plaintiff is the owner, the burden falls on the defendant to set up a right or title to possession consistent with the fact of ownership vested in the plaintiff.[71] In the most recent edition of Bullen and Leake and Jacob's Precedents of Pleadings it is suggested that although it may not, strictly speaking, be necessary to do so, in such cases a plaintiff should plead and prove that he or she was the original landlord, that the defendant was the original tenant or acquired the tenancy or claims under the tenant, that the tenancy agreement has been terminated and that the defendant remains in occupation of the property.[72]
[70] Allen v Roughley (1955) 94 CLR 98, 110 (Dixon CJ)
[71] Portland Management Ltd v Harte [1977] 1 QB 306, 316 (Scarman LJ, Bridge LJ agreeing), 321 (Megaw LJ).
[72] Bullen and Leake and Jacob's Precedents of Pleadings (17th ed, 2012) 1675 [98-02].
Broadway has clearly established its claim to possession of the disputed land. All of the facts necessary for it to do so were either admitted by Mr Lewis in his Amended Defence and Counterclaim or established on the uncontradicted evidence. Having regard to the admissions made in the defence and to the evidence to which I have already referred, I make the following factual findings:
·Broadway is, and was at all material times, the registered proprietor of Lot 1490.
·Between May 1992 and on or about 2 March 2005, Broadway was the registered proprietor of Lot 1491.
·Lots 1490 and 1491 are adjacent Lots, and Lot 1491 adjoins Lot 1490 on the eastern boundary of Lot 1490.
·The Fence runs in an approximately north-south direction on Lot 1490 as depicted in the survey plan attached to the Further Amended Statement of Claim and marked 'B'.
·The disputed land is between the Fence and the eastern boundary of Lot 1490.
·In or about September 2003, and pursuant to the Lease, Broadway leased Lot 1491 and the disputed land to Mr Lewis and Ms Burchnell.
·On or about 18 January 2005, Broadway entered into the Contract with Mr Lewis and Ms Burchnell, for the sale of Lot 1491.
·The parties to the Contract executed a transfer of land form for the transfer of Lot 1491 from Broadway to Mr Lewis and Ms Burchnell.
·The settlement of the transfer of Lot 1491 occurred on or about 2 March 2005 and the Lease terminated on that date.
·From 2 March 2005 to 10 November 2009, Mr Lewis and Ms Burchnell remained in occupation of the disputed land.
·On 10 November 2009, Mr Lewis became the sole registered proprietor of Lot 1491 and since that date he has remained in occupation of the disputed land, by keeping machinery, vehicles and equipment on the disputed land, and has refused to vacate the disputed land.
The evidence adduced on behalf of Broadway does not support a finding that any of the facts pleaded by Mr Lewis in support of the counterclaim have been established. There being no evidence adduced by Mr Lewis in support of the facts pleaded in the Counterclaim, there is no basis for a finding that Mr Lewis (and not Broadway) has a right to possession of the disputed land.
For completeness, there is also no basis for granting any of the relief sought by Mr Lewis in his Counterclaim.
(b) Broadway's claim for damages for use and occupation of the disputed land on the basis that Mr Lewis was either a tenant at will or a tenant at sufferance
The essential element of a cause of action for use and occupation is the existence of an agreement between the parties, whether express or implied, to the effect that the defendant will be the tenant of the plaintiff and shall pay for the occupation.[73] If there is no tenancy, no action for use and occupation will lie.[74]
[73] Attorney General v De Keyser's Royal Hotel [1920] AC 508, 533 (Lord Atkinson) and the cases cited therein; Australian Provincial Assurance Association Ltd v Rogers(1943) 43 SR (NSW) 202, 205 (Jordan CJ); Zegir v Woop [1955] VLR 394, 401 (Herring CJ); Spektor v Lees [1964] VR 10, 16 (Sholl J); Scientific Management Associates (Australia) Pty Ltd and Anor v Australian Capital Territory [1999] ACTSC 17 [35] – [43] (Miles CJ); Ovideo Carrideo Nominees Pty Ltd v The Dog Depot Pty Ltd [2006] VSCA 6 [21] (Chernov JA).
[74] Morris v Tarrant [1971] 2 QB 143, 158 (Lane J); Zegir v Woop [1955] VLR 394, 401 (Herring CJ) referring to Bayley v Bradley (1848) 5 CB 396; 136 ER 932 and Leigh v Dickeson (1884) 12 QBD 194; Scientific Management Associates (Australia) Pty Ltd and Anor v Australian Capital Territory [1999] ACTSC 17 [28] (Miles CJ).
A contract to pay reasonable compensation for use and occupation will be implied by law from the fact that land belonging to the plaintiff has been occupied by the defendant with the claimant's permission.[75] An action for use and occupation lies whenever there is a relationship or an intended relationship of landlord and tenant.[76]
[75] Churchward v Ford (1857) 2 H & N 446, 449; 157 ER 184, 185 - 186 (Bramwell B) referred to in Australian Provincial Assurance Association Ltd v Rogers (1943) 43 SR (NSW) 202, 205 (Jordan CJ).
[76] Morris v Tarrant [1971] 2 QB 143, 158 (Lane J).
The implication of a tenancy agreement may be negatived by the surrounding circumstances. An example is where a purchaser, with the owner's permission, enters into possession of property sold under a contract of sale, and the purchase of the land subsequently does not proceed.[77]
[77] Ovideo Carrideo Nominees Pty Ltd v The Dog Depot Pty Ltd [2006] VSCA 6 [35] (Nettle JA); Attorney General v De Keyser's Royal Hotel [1920] AC 508, 533 (Lord Atkinson) and the cases cited therein; and see also the discussion of the history of the action for use and occupation in Scientific Management Associates (Australia) Pty Ltd and Anor v Australian Capital Territory [1999] ACTSC 17 [35] – [45] (Miles CJ).
I turn to consider Broadway's alternative claims that Mr Lewis was a tenant at will or a tenant at sufferance.
Was Mr Lewis a tenant at will?
A tenancy at will arises where a person lets land to another without specifying any term of the tenancy.[78] The landlord's agreement to let the premises may be implied from the circumstances. So, for example, a tenant whose lease has expired but who is permitted to continue in possession pending a further lease will be a tenant at will, and in that case the terms of the expired lease will continue to apply.[79] However, without the lessor's express or implied consent, a tenancy at will cannot exist.[80]
[78] Blundell L and Wellings V, Woodfall's Law of Landlord and Tenant (27th ed, 1968) 279-280 [669]; Howard v Shaw (1841) 8 M & W 118, 122; 151 ER 973, 974 - 975 (Lord Abinger CB).
[79] Simpkin v Ashurst (1834) 1 CM and R 261; Morgan v Harrison [1907] 2 Ch 137, 142 - 143 (Cozens-Hardy MR).
[80] Doe d Heming v Brett (1840) Hurl & W 3, 3 (Parke B); Churchward v Ford (1857) 2 H & N 446, 449, 449, 450; 157 ER184, 185 (Pollock CB), 185-186 (Bramwell B), 186 (Watson B).
An estate at will may be determined by the lessor doing anything which is inconsistent with the tenancy at will.[81] Accordingly, a demand of possession will terminate a tenancy at will,[82] as does an entry by the landlord onto the land without the tenant's consent.[83]
[81] Blundell L and Wellings V, Woodfall's Law of Landlord and Tenant (27th ed, 1968) 282 - 283[675] and the examples and cases cited therein.
[82] Doe d Jones v Jones (1830) 10 B & C 718, 721; 109 ER 616, 617 - 618 (Parke J).
[83] Doe d Bennett v Turner (1840) 7 M & W 226, 232 - 233; 151 ER 749, 751 (Parke J); Turner v Doe d Bennett (1842) 9 M & W 643, 646; 152 ER 271, 273 (Lord Denman CJ).
There was no express tenancy at will in this case. Broadway's case was that a tenancy at will should, however, be implied, having regard to the circumstances. The focus of Broadway's submissions was very much on what Mr Lewis knew, or should be imputed to have known. For example, it was submitted that an implied agreement should be found because the evidence supported the conclusion that Mr Lewis knew that the disputed land belonged to Broadway, and knew that occupation of the land was something of value.[84]
[84] See Plaintiff's Outline of Closing Submissions dated 14 September 2012 [6] – [14].
However, it is not necessary to make findings as to Mr Lewis' knowledge or imputed knowledge, and particularly as to whether Mr Lewis knew that he had not purchased the disputed land pursuant to the Contract. This is because Broadway's case on the implied tenancy at will fails for a different reason. In my view, Broadway has failed to establish on the balance of probabilities that it consented to the creation of the alleged implied tenancy at will.
The evidence supports the conclusion that immediately before and, for some months after, the settlement, Broadway clearly signalled its objection to Mr Lewis and Ms Burchnell remaining in occupation of the disputed land after the settlement. The evidence in relation to the period before the settlement was as follows.
Between late 2003 or early 2004 and immediately prior to the settlement, Mr Denis Criddle had four conversations with Ms Burchnell during which he noted that the Fence was not on the boundary line and would need to be moved. Mr Criddle's evidence was that he had a telephone conversation with Ms Burchnell in late 2003 or early 2004 and in the course of that conversation, Ms Burchnell advised that she and Mr Lewis wished to buy Lot 1491. Mr Criddle's evidence was that he responded: 'You do realise that the boundaries aren't in the right place, don't you?'[85] Ms Burchnell did not refer to this discussion in her evidence. I accept Mr Criddle's evidence of what was said in this conversation.
[85] Exhibit B, affidavit of Denis Criddle, sworn 11 July 2012, Annexure DRC-A [32].
That this conversation occurred is also supported by Mr Criddle's evidence that he wrote to Ms Burchnell on 30 January 2004 in relation to the proposed sale of Lot 1491.[86] A copy of that letter was annexed to Mr Criddle's witness statement. The letter indicates, amongst other things, that 'Decmil will provide the fences between the lots 1490/1491 … on the completion of the sale in 2004'. Although Ms Burchnell said that she did not independently recall receiving that letter,[87] I rely on the fact that the letter was sent by Mr Criddle as supporting my finding that Mr Criddle raised the boundary between the lots with Ms Burchnell in late 2003 or early 2004.
[86] Exhibit B, affidavit of Denis Criddle, sworn 11 July 2012, Annexure DRC-A [34]. The letter refers to Lot 1490, but bears a handwritten annotation deleting Lot 1490 and noting Lot 1491 instead. Counsel for Broadway submitted that the copy of the letter in evidence was obtained from discovery provided by Mr Lewis, and submitted that the amendment to the lot number was not made by his client.
[87] Exhibit D, affidavit of Kathryn Burchnell, sworn 19 July 2012, Annexure KEB-A [22].
Mr Denis Criddle also referred to a telephone conversation he had with Ms Burchnell on 5 January 2005 in which Ms Burchnell told him that she was 'in a position to proceed with the sale'.[88] Mr Criddle's evidence was that he responded: 'The water, power and fencing will need to be sorted out as soon as possible to enable settlement to go through. Decmil Australia personnel in Karratha will handle it for Broadway'.[89]
[88] Exhibit B, affidavit of Denis Criddle, sworn 11 July 2012, Annexure DRC-A [40].
[89] Exhibit B, affidavit of Denis Criddle, sworn 11 July 2012, Annexure DRC-A [40].
Ms Burchnell gave evidence of a further conversation that she had with Mr Denis Criddle shortly before settlement in which Mr Criddle advised that 'we are going to send around contractors to move the fence'.[90] Ms Burchnell's evidence was that after speaking with Mr Criddle, she advised Mr Lewis that 'Denis rang and said that they need to move the fence because it's not on the boundary'.[91]
[90] Exhibit D, affidavit of Kathryn Burchnell, sworn 19 July 2012, Annexure KEB-A [25].
[91] Exhibit D, affidavit of Kathryn Burchnell, sworn 19 July 2012, Annexure KEB-A [26].
Ms Burchnell also gave evidence that prior to settlement she had another conversation with Mr Denis Criddle, during which he told her that he was 'having trouble communicating with Steve [Mr Lewis] in relation to the boundary'.[92]
[92] Exhibit D, affidavit of Kathryn Burchnell, sworn 19 July 2012, Annexure KEB-A [28].
In addition to these four conversations between Mr Criddle and Ms Burchnell, there was evidence that Broadway had arranged for the boundary between the two Lots to be surveyed. Mr Denis Criddle's evidence was that in November 2004 Decmil Australia engaged Whelans to conduct a survey of the boundary of Lots 1490 and 1491.[93] There was evidence that as a result of that survey the boundary was pegged.
[93] Exhibit B, affidavit of Denis Criddle, sworn 11 July 2012, Annexure DRC-A [38].
There was also evidence that on at least one occasion prior to the settlement, Broadway had attempted to move the Fence. Ms Burchnell gave evidence that shortly before the settlement, Mr Lewis told her that 'Denis sent fencing contractors around today. I refused to let them onto our land and told them to leave. There's no way he's moving that fence.'[94]
[94] Exhibit D, affidavit of Kathryn Burchnell, sworn 19 July 2012, Annexure KEB-A [27].
This evidence, and especially the evidence that Broadway attempted to move the fence to the boundary line, supports the conclusion that prior to the settlement Broadway signalled that it did not consent to the continued occupation of the disputed land by Mr Lewis and Mrs Burchnell after the settlement and the termination of the lease.
Broadway's position in the months immediately after the settlement did not change.
There was evidence that after the settlement, Broadway had attempted to move the fence and that Mr Lewis had refused to permit Broadway's fencing contractors to do so. On 14 October 2005, Ms Burchnell[95] wrote to Mr Denis Criddle. The letter provided:[96]
We are writing this letter to you in regards to the fence line between our depots in Karratha.
We agreed to purchase the land situated at Lot 1491 Lambert Road Karratha as it was – with the fence line where it currently stands. It is quite disappointing to find [that] once the agreement was made your company has sent contractors several times to have the fence shifted without further discussions with Steve or myself. We had rented this property as it was from your company for some time with the intention of purchasing it. Your company had removed its contents from all sheds which we had assumed to be ours – now we find you disagree with the boundary and are intent on shifting the fence.
…
As we do not understand the legal implications of this situation we have sought some legal advice and as we understand it your company has misrepresented the land that was offered for sale and we are within our rights to refuse re‑fencing the boundary between our properties and continue to use it - as is. (emphasis added)
[95] The letter was written by Ms Burchnell on behalf of herself and Mr Lewis as directors of Blackthorn.
[96] Exhibit 1, tab 9.
Mr Denis Criddle responded by letter dated 28 October 2005. Amongst other things, his letter stated:[97]
[97] Exhibit 1, tab 10.
Further to your letter of the 18th of October 2005, we are somewhat staggered at the suggestion that there has been a misrepresentation of the property boundaries in respect of Lot 1491 which was purchased by you earlier this year.
The existing fence is, as was well known to you:
1.not a fence that divides the boundary between Lots 1490 and 1491; and
2. in its present location purely as a security measure to restrict access between Lots 1490 and 1491 (both of which were owned by us during your rental of Lot 1491 and a portion of Lot 1490).
The existing fence has, as was also well known to you, never been represented to either you or any other party as a boundary or dividing fence between the two (2) lots.
…
After the settlement of the sale of [Lot 1491] there was always a requirement for the security fence to be relocated along the surveyed boundary of Lots 1490 and 1491 …
We therefore expect that the fence line will be constructed on the Lands Department Survey boundary in accordance with the law, and this be completed as expeditiously as possible. (original emphasis)
Counsel for Broadway indicated that the letter of 14 October 2005 was not relied on for the truth of its contents (insofar as it alleged that representations were made by Broadway), but as evidence that there was a communication between the parties in relation to the Fence. I have relied on the letter of 14 October 2005 and the letter in reply of 28 October 2005 as evidence of two things. First, the correspondence establishes that after the settlement there were communications between the parties concerning a dispute between them about the Fence and the ownership of the disputed land. (I make no findings as to whether representations of the kind referred to in the correspondence were in fact made.) Secondly, the correspondence confirms that there had been attempts by Broadway to have the Fence moved to the boundary line between the two Lots and that these attempts had been resisted.
Broadway's attempts to move the Fence after settlement signalled in very clear terms that it did not consent to the continued presence on the disputed land of Mr Lewis and Ms Burchnell.
There was no evidence of any further communication between the parties in relation to the Fence or the disputed land between October 2005 and 25 August 2010.
Counsel for Broadway accepted that it might be possible to say that initially Broadway treated Mr Lewis and Ms Burchnell as trespassers, but submitted that that attitude to their presence on the disputed land did not necessarily have to be static.[98] Counsel submitted that over the period since 2 March 2005, it was possible that the actual legal relations between the parties changed and could be characterised differently at different times.[99]
[98] ts 100.
[99] ts 100.
While the relationship between the parties could, at least in theory, have been subject to change, there was no evidence which suggested that Broadway resiled from its position some time between October 2005 and November 2009, and on the basis of which its consent to Mr Lewis remaining on the disputed land might be implied. Counsel for Broadway's submission was effectively that Broadway's silence from October 2005 until November 2009, in the face of Mr Lewis' continued occupation of the disputed land, implied its consent to his tenancy. I am unable to accept that submission, in the face of Broadway's clear position, both immediately before and after settlement, that it did not consent to Mr Lewis' and Ms Burchnell's continued presence on the disputed land
Moreover, the submission is inconsistent with evidence as to Broadway's own view of the situation. In a letter dated 25 August 2010,[100] Broadway's solicitors wrote to Mr Lewis on behalf of Broadway, and advised Mr Lewis that he was 'occupying [the disputed land] without Broadway's permission and obstructing Broadway's attempts to recover possession' (emphasis added). The matters referred to in the letter as the basis for that statement included events since the settlement of the transfer of Lot 1491 on 2 March 2005. In my view, the letter makes clear that Mr Lewis occupied the disputed land throughout the period between 2 March 2005 and 25 August 2010 without Broadway's permission.
Was Mr Lewis a tenant at sufferance?
[100] A copy of this letter was in evidence: Exhibit 1, tab 15.
Broadway submitted, in the alternative, that the evidence established that from about 10 November 2009, Mr Lewis was a tenant at sufferance.
A tenant at sufferance is the label which is usually given to a tenant who lawfully enters into occupation of premises (pursuant to a lease, for example), and, after that period of lawful occupation has ceased, continues in occupation without the the owner's assent or dissent.[101] Thus a tenancy at sufferance is not, strictly speaking, a tenancy at all, but a holding over by wrong.[102] A tenant at sufferance may therefore be contrasted with a tenant at will in that the former occupies the premises by right, whilst the latter holds over by wrong after the expiration of the lawful title.[103]
[101] Natural Gas and Oil Corporation Ltd (In Liq) v Byrne and Boyle (1951) 68 WN (NSW) 207, 213 (Herron J) citing Blundell L, Woodfall's Law of Landlord and Tenant (24th ed, 1939) 285; Individual Homes Pty Ltd (In Liq) v Martin [1999] ACTSC 139 [36] (Higgins J).
[102] Simms v Lee [1945] 45 SR (NSW) 352, 354 (Roper J).
[103] Natural Gas and Oil Corporation Ltd (In Liq) v Byrne and Boyle (1951) 68 WN (NSW) 207 at 213 (Herron J) citing Blundell L, Woodfall's Law of Landlord and Tenant (24th ed, 1939) 285.
The category of tenants at sufferance has been confined to persons who hold over without the assent or dissent of their landlord. It does not include persons who hold over wrongfully in spite of the active objection of their landlord.[104] Threats to enter and dispossess a person occupying premises constitute the active dissent of the landlord to the wrongful holding over.[105]
[104] Remon v City of London Real Property Co [1921] 1 KB 49, 58 (Scrutton LJ).
[105] Simms v Lee [1945] 45 SR (NSW) 352, 354 (Roper J).
The evidence does not establish, on the balance of probabilities, that Mr Lewis was a tenant at sufferance. Had there been no evidence of any objection by Broadway to Mr Lewis' continued occupation of the disputed land, either prior to, or immediately after, settlement, then it might have been possible to construe Broadway's silence in the period between 2 March 2005 and 10 November 2009 as neither assent nor dissent to that continued occupation.
However, for the reasons I have set out above, Broadway's conduct immediately before and after the settlement manifested an active dissent to Mr Lewis' continued presence on the disputed land after the settlement. In the face of that active dissent, and absent any other evidence, Broadway's silence in the period from 2 March 2005 to 10 November 2009 cannot be construed as indicating that Broadway resiled from its dissent, so as to tacitly permit Mr Lewis' continued presence.[106] That Broadway never resiled from its position is made clear in the letter dated 25 August 2010 from its solicitors to Mr Lewis, to which I have already referred.
Quantum of a claim for damages for use and occupation
[106] Cf Morris v Tarrant [1971] 2 QB 143, 159 – 160 (Lane J).
My finding that Mr Lewis was not a tenant at will or a tenant at sufferance means that Broadway's claim for damages for use and occupation must fail.
However, in case I am wrong in this conclusion, it is appropriate that I briefly set out the quantum of the damages I would have awarded had Broadway's claim for use and occupation been made out.
In the absence of an express agreement, a plaintiff may only recover reasonable compensation for the land occupied. Ordinarily, that will be the value of the rent of the premises on the open market.[107] The amount will depend upon the value of the premises and the duration of the occupation.
[107] Churchward v Ford (1857) 2 H & N 446, 449; 157 ER 184.
There was evidence that Decmil Australia has leased Lot 1490 (apart from the disputed land) from Broadway since at least 1 July 2008. A rent review was conducted in July 2010, and Broadway and Decmil agreed (having regard to an appraisal which had been conducted) that the rent payable from 1 July 2010, in respect of that part of the Lot which constituted vacant land, should be calculated at the rate of $20 per square metre (subject to a 5% discount to ensure that the rent remained on the conservative side of the appraisal).[108] There was also evidence that the rent which had previously been paid by Decmil Australia for Lot 1490 (apart from the disputed land) was approximately half that which was payable from 1 July 2010.[109]
[108] Exhibit C, witness statement of Scott Criddle, dated 7 September 2012, Annexures SJC-4 and SJC-5; ts 123 - 124
[109] Exhibit C, witness statement of Scott Criddle, dated 7 September 2012, Annexure SJC-3 (Second Schedule); see also ts 124.
There was also evidence that Decmil Australia required additional space in Karratha for its operations and would have been prepared to take up the disputed land in addition to its lease over the balance of Lot 1490.[110]
[110] Exhibit C, witness statement of Scott Criddle, dated 7 September 2012 [6].
The damages claimed by Broadway for use and occupation were set out in a Schedule of Damages and Interest which counsel for Broadway provided to the Court. The damages claimed were calculated on the basis of $10 per square metre for 1164 square metres (the area of the disputed land) for 233 days (for the period between 10 November 2009 and 30 June 2010), and $20 per square metre for the area of the disputed land for 804 days (for the period from 1 July 2010 to 11 September 2012), totalling $64,580.44 (inclusive of GST), and continuing at the rate of $63.78 per day until judgment.
I accept that these figures represented what would have been the rent likely to have been obtained for the disputed land on the open market.
Had it been necessary to award damages for use and occupation, I would have awarded damages of $64,580.44 (inclusive of GST) until 11 September 2012 and continuing at the rate of $63.78 per day until judgment.
Broadway's claim for damages for trespass by Mr Lewis on the disputed land
'Mesne profits' is the name traditionally given to damages for trespass sought by a landlord against a tenant when the tenant fails to vacate the premises following the termination of the lease.[111] For the reasons set out below, Broadway's claim for damages for trespass must fail. In this section of my reasons I deal with the following issues:
(i)Mesne profits for trespass at common law.
(ii)Statutory modifications of the common law position.
(iii)The position in Western Australia.
(iv)The submission by counsel for Broadway as to how mesne profits could be pursued in these proceedings.
(v)A contrary authority.
Mesne profits for trespass at common law
[111] Wilson v Kelly [1957] VR 147, 152 (Gavan Duffy J); Elliott v Boynton [1924] 1 Ch 236, 245 (Pollock MR); Dunlop v Macedo (1891) 8 TLR 43, 43 (Wills J); Lollis v Loulatzis [2007] VSC 547 [219] (Kaye J).
The principles applicable to a claim for mesne profits for trespass were discussed in some detail by Edelman J in Hampton v BHP Billiton Minerals Pty Ltd [No 2][112] and I gratefully adopt his Honour's detailed exposition of the relevant authorities. As his Honour explained, in order to bring a claim for mesne profits at common law, a landlord first had to re-enter the land (usually as a result of an action for ejectment) before suing for mesne profits for the tenant's trespass on the land.[113] By a legal fiction, the trespass would then be deemed to have occurred from the time when the landlord was first entitled to possession (rather than from the time when the landlord regained possession). This legal fiction was known as the doctrine of trespass by relation. At common law, therefore, a landlord faced with a tenant who refused to vacate the premises following the termination of a tenancy had to commence two proceedings: first to recover possession, and then to pursue damages for the trespass (that is, the mesne profits).
[112] Hampton v BHP Billiton Minerals Pty Ltd [No 2] [2012] WASC 285 [270] – [323].
[113] Hampton v BHP Billiton Minerals Pty Ltd [No 2] [2012] WASC 285 [300] – [308].
That this was the position at common law was confirmed by Taylor J in Minister of State for the Interior v RT Co Pty Ltd in the following passage:[114]
[I]t was pointed out that a claim for mesne profits is a particular form of the action for trespass, that as such it is based upon an injury to the plaintiff's possession and that the plaintiff is enabled to recover only upon the doctrine of trespass by relation. That is to say, that upon entering into possession the plaintiff is deemed by a legal fiction to have been in possession ever since his right to possession arose. But, so the argument ran, a plaintiff is not entitled to assert a claim to mesne profits until entry or re-entry has taken place. The principle upon which the submissions are based are clearly established (see Tharpe v Stallwood; Barnett v The Earl of Guildford; Dunlop v Macedo; Ocean Accident and Guarantee Corporation v Ilford Gas Company; Wynne v Green; and Ebbels v Rewell; Salmond on Torts 13th ed (1961) p 179 and Fleming on Torts 2nd ed (1961) p 80) and it is too late in the day to deny that at common law a plaintiff suing for mesne profits could not, in general, succeed unless he proved that pursuant to a right to do so he had entered into possession. (citations omitted)
[114] Minister of State for the Interior v RT Co Pty Ltd (1962) 107 CLR 1, 5 - 6.
Counsel for Broadway drew my attention to the decision in Nilan v Nilan[115], which he submitted supported the proposition that at least in an action by a married woman against her husband, a claim for mesne profits can be joined with a claim for ejectment. In that case, the plaintiff brought an action against her former husband for possession of a home belonging to her in which the parties had previously lived. The action for possession also contained a claim for damages by way of mesne profits. However, the judgment of Street CJ (with whom Owen & Herron JJ agreed) did not deal with the question whether a claim for mesne profits could be joined with a claim for ejectment in all cases, but simply assumed (for the purpose of determining the different question which was before the Court) that it could. The case does not support the proposition contended for by counsel.
Statutory modifications of the common law position
[115] Nilan v Nilan (1951) 68 WN (NSW) 271.
The need for two separate proceedings to obtain recovery of possession and mesne profits was overcome in the United Kingdom by the enactment of the Common Law Procedure Act 1852[116] (the CLP Act). Section 214 of the CLP Act provided, in summary, that in the trial of an action for ejectment brought by a landlord against a tenant, and after the landlord had proved his right to possession of the premises, the Court could permit the landlord to go into evidence of the mesne profits which had or might have accrued from the date of termination of the tenant's interests. If the jury found for the landlord, it could give a verdict both as to possession and as to the amount of the damages to be paid for mesne profits, and the landlord could have judgment for both.
[116] 15 & 16 Vict c 66.
Later, the rules of court also came to reflect the legal position brought about by s 214 of the CLP Act.[117]
[117] See the discussion in Dunlop v Macedo (1891) 8 TLR 43, 43 – 44 (Wills J).
Similar statutory provisions were introduced in some Australian jurisdictions.[118] Taylor J referred to some of these statutory provisions in Australia and the United Kingdom in Minister of State for the Interior v RT Co Pty Ltd when noting that in a number of jurisdictions it was permissible for a landlord, after a holding over without consent, to combine a claim for mesne profits with an action of ejectment.[119] The effect of these statutory provisions was that there was no need for the plaintiff to re-enter into possession of the property before pursuing a claim for mesne profits, but rather the claim for mesne profits could be brought in the same proceedings as the action for ejectment itself.[120]
The position in Western Australia
[118] See, for example, s 119 of the Supreme Court Act 1958 (Vic). See also s 12 of the Landlord and Tenant Act 1899 (NSW) discussed in Oliveri v Jones [1999] NSWSC 154 [25] (Master Macready) and on appeal in Oliveri v Jones [1999] NSWSC 796 [3] – [6] (Bryson J).
[119] Minister of State for the Interior v RT Co Pty Ltd (1962) 107 CLR 1, 6.
[120] Sappideen C and Vines P (eds), Fleming's The Law of Torts (10th ed, 2011) 60 [3.110].
Given the clear common law position (and in the absence of High Court authority contrary to the decision in Minister of State for the Interior v R T Co Pty Ltd), it could only be by virtue of a statutory exception to that position that a claim for mesne profits could be pursued in the same proceedings as a claim for possession in Western Australia. Neither counsel for Broadway, nor the Court's own research, has been able to identify any such statutory exception.
Section 214 of the CLP Act does not form part of the statute law applicable in Western Australia. The CLP Act was enacted after the establishment of the State.[121] Accordingly, the CLP Act was not part of the law of the United Kingdom which was inherited by Western Australia at the time of its establishment.
[121] Section 73 of the Interpretation Act 1984 (WA) provides that for the purpose of determining the applicability or otherwise within the State of any Imperial Act, the State shall be deemed to have been established on 1 June 1829.
Further, nothing in the terms of the CLP Act suggests that it was intended to apply by paramount force in Western Australia. In addition, neither the CLP Act generally nor s 214 in particular, appears to have been expressly adopted or applied in this State.[122]
[122] For a general discussion of the means by which statutes of the Parliament of the United Kingdom came to be applied in Western Australia, see Law Reform Commission of Western Australia, United Kingdom Statutes in Force in Western Australia, Final Report (October 1994) 1 [1.2].
It also appears that no legislation has been enacted in this State, either in similar terms to s 214 of the CLP Act or otherwise, to create an exception to the common law position.
As no such legislative exception has been created in Western Australia, the position in this State is that a claim for mesne profits cannot be pursued in the same action as a claim for possession.
The submission by counsel for Broadway as to how mesne profits could be pursued in these proceedings
Counsel for Broadway submitted:[123]
The principle of relation back of a claim for mesne profits for trespass is that once the plaintiff has an order for recovery of possession (ejectment) the plaintiff is deemed to have been entitled to mesne profits from the date that the plaintiff was entitled to possession. … The plaintiff submits that if the principle of relation back is to be given effect, then on the making of the order of recovery of possession the plaintiff is deemed to have had a cause of action for mesne [profits] as from the date that the plaintiff is entitled to possession, and therefore the action for mesne profits should be able to be brought, because simultaneously on the making of the order for recovery of possession the plaintiff has a complete cause of action for mesne profits that is deemed to have existed since prior to the date of the writ.
[123] Plaintiff's Outline of Closing Submissions dated 14 September 2012 [23] – [24].
I am unable to accept this submission. At the time that judgment is obtained for an order for recovery of possession, a plaintiff does not have a complete cause of action for mesne profits. As Edelman J explained in Hampton, a claim for mesne profits is a claim for damages for trespass, and in order to establish an action for trespass, it is necessary for a plaintiff to have been in physical possession of the land, and for the defendant to have interfered with that possession. Accordingly, the cause of action for trespass is not complete until such time as the plaintiff obtains physical possession of the premises (ordinarily pursuant to an order for possession). This much is clear from the authorities referred to by Taylor J in Minister of State for the Interior v RT Co Pty Ltd in the passage set out above, particularly Dunlop v Macedo[124] and Ebbels v Rewell.[125] Because the cause of action is not complete at the point that judgment is given on an action for possession, but only after that judgment is executed by the landlord's re-entry, the action for mesne profits cannot be pursued in the same proceedings as the action for possession.
[124] Dunlop v Macedo (1891) 8 TLR 43, 43 (Wills J).
[125] Ebbels v Rewell [1908] VLR 261, 265 (Hodges J).
It is a trite principle that in the absence of a statutory provision to the contrary,[126] 'the cause of action in respect of which a litigant approaches the Court of justice must be complete at the time when he issues his process'.[127]
[126] See, for example, third party proceedings under O 19 RSC. See also Andrews v Nominal Defendant [1963] NSWR 359, 36 - 371 (the Court); Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589, 595 (Gibbs CJ, Mason & Aickin JJ).
[127] Re Keystone Knitting Mills' Tradesmark [1929] 1 Ch 92, 103 (Lord Hanworth MR); see also Eshelby v Federated European Bank Ltd [1932] 1 KB 254, 260 (Swift J); Wigan v Edwards (1973) 47 ALJR 586, 592 (Gibbs J), 596 (Mason J); Baldry v Jackson [1976] 2 NSWLR 415, 417 - 418 (Samuels JA, Moffit P & Glass JA agreeing).
There is no authority for the proposition that a court could 'relate back' an action for mesne profits, so that it could be commenced prior to the plaintiff obtaining possession. In view of the decision of Taylor J in Minister of State for the Interior v RT Co Pty Ltd and the authorities referred to by his Honour (in the passage set out above) it is not open to this Court to adopt the submission advanced by counsel for Broadway.
Counsel for Broadway also submitted that the approach for which he contended would be consistent with the objects underlying O 1 r 4A of the RSC. While that is no doubt true, neither that rule (nor the objects underlying it) can overcome the fact that the cause of action for mesne profits is inchoate until the landlord regains actual or physical possession of the land the subject of the trespass.
A contrary authority
It is necessary to deal with one further matter. The conclusion I have reached is contrary to a decision of this Court in Grainger and Anor v Williams and Ors.[128] In that case, Simmonds J observed[129] that damages for trespass 'appear[ed] to be available' even though the plaintiff landlords were not in possession at the time they commenced proceedings (and when in fact the proceedings included both an action for possession and for mesne profits).
[128] Grainger v Williams [2005] WASC 286.
[129] Grainger v Williams [2005] WASC 286 [57].
In the course of his discussion of the claim for mesne profits,[130] Simmonds J referred to Clifton Securities v Huntley,[131] to Wilson v Kelly[132] and to a number of legal texts. It does not appear that his Honour's attention was drawn to the fact that in both the United Kingdom and in Victoria at the time of these decisions, legislation had modified the common law position to permit mesne profits to be pursued in the same proceedings as an action for possession.
[130] Grainger v Williams [2005] WASC 286 [57].
[131] Clifton Securities v Huntley [1948] 2 All ER 283.
[132] [1957] VR 147.
Simmonds J also relied on Minister of State for the Interior v RT Co Pty Ltd. However, his Honour's attention does not appear to have been drawn to that part of the judgment of Taylor J where the position at common law was contrasted with the position in those jurisdictions where legislative exceptions to the common law position had been introduced. In that sense, the view expressed by Simmonds J should not properly be viewed as a conclusion as to the common law position.
However, to the extent that the reasons of Simmonds J can properly be read as a conclusion as to the position at common law, then for the reasons I have already given, his Honour's decision is in my respectful view 'plainly wrong'[133] and I respectfully decline to follow it.
Conclusion
[133] See the discussion in Duckworth v Water Corporation [2012] WASC 30 at [26] - [31] (Edelman J) and the cases cited therein.
In my view, insofar as Broadway seeks mesne profits in this action, its claim must be dismissed, because its cause of action is not yet complete.
It is unnecessary to say anything further in relation to Broadway's claim for mesne profits. It is also inappropriate to do so, given the possibility that Broadway may seek to pursue that claim at some time in the future.
The relief sought by Broadway
(a) The orders which should be made
I propose to make an order to the effect that Mr Lewis give possession to Broadway of the disputed land.
I also propose to order that Mr Lewis' Counterclaim be dismissed, and that Broadway's claims for damages for use and occupation and for mesne profits, be dismissed.
I will hear from counsel in relation to the precise form of these orders, and in relation to its application for costs.
It remains to consider two other orders sought by Broadway.
(b) Whether there should be an order for an injunction to compel the removal of chattels
Broadway sought an injunction that Mr Lewis immediately remove all chattels in his possession and control from Lot 1490.
I am not persuaded that such an injunction should be granted in the circumstances of this case for two reasons. First, the grant of an order for possession of the disputed land will put beyond doubt Broadway's entitlement to possession of the disputed land. Mr Lewis should be given the opportunity to comply with that order of his own volition.
Secondly, a fundamental consideration in relation to whether an injunction should be granted is whether there exists an adequate alternative remedy.[134] In this case, for the reasons discussed below, it appears that Broadway will be able to rely on the provisions of the CJE Act to enforce the order for possession. The avenues for enforcement available under that Act are an adequate alternative to the grant of an injunction of the kind sought. Counsel for Broadway conceded that this was so.[135]
(c) Whether an order should be made under s 95 of the CJE Act
[134] See, eg, London and Blackwall Railway v Cross (1886) 31 Ch D 354, 369 (Lindley LJ) in relation to the existence of an alternative remedy in damages.
[135] ts 99.
In the course of the hearing, counsel for Broadway submitted that the Court should make an additional order in the following terms:
There be leave to issue an order, in the form of Form 36 – Property (Seizure and Delivery) Order – Real Property under the Civil Judgments Enforcement Act 2004 (WA) addressed to the Sheriff, authorising the Sheriff to seize the land at 1490 Lambert Road Karratha Industrial Estate Karratha occupied by the defendant being part of Lot 1490 on Deposited Plan 213939 and being the whole of the land in certificate of title volume 2124 folio 64 and deliver possession of it to the plaintiff, but such order shall not be executed until 7 days after the making of these orders.
The order was sought pursuant to s 95 of the CJE Act. Section 95(1) provides:
In order to enforce a judgment to which this Division applies, a person entitled to the benefit of the judgment may apply to the court for an order, addressed to the Sheriff, authorising the Sheriff to seize the property concerned and deliver possession of it to the person.
Division 1 of Pt 5 of the CJE Act, in which s 95 is to be found, applies in cases where the Court grants an order for possession of land.[136]
[136] Section 94 of the CJE Act.
It would not be appropriate to make an order of this kind without notice to Mr Lewis. The general rule is that in cases where a trial proceeds in the absence of a defendant, the plaintiff will be confined to relief clearly pleaded.[137]
[137] Stone v Smith (1887) 35 Ch D 188, 190 (Kekewich J).
In any event, it is far from clear that it is open to Broadway to make an application under s 95 of the CJE Act at this point in time. The terms of s 95(1) suggest that before a person may apply for an order under that subsection, the person needs to have obtained judgment, and the person needs to be entitled to the benefit of the judgment.
Further, it remains to be seen whether an application for an order under s 95 of the CJE Act will be necessary. Mr Lewis should first be given the opportunity to comply with the orders to be made by the Court.
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS
CITATION: BROADWAY PTY LTD TRADING AS TRUSTEE FOR THE CRIDDLE FAMILY TRUST -v- LEWIS [2012] WASC 373 (S)
CORAM: PRITCHARD J
HEARD: 28 NOVEMBER 2012
DELIVERED : 13 DECEMBER 2012
FILE NO/S: CIV 2642 of 2010
BETWEEN: BROADWAY PTY LTD TRADING AS TRUSTEE FOR THE CRIDDLE FAMILY TRUST
Plaintiff
AND
STEVEN BURNETTE LEWIS
Defendant
Catchwords:
Practice and procedure - Costs - Whether the plaintiff is entitled to recover all of its costs where it did not succeed on all of its causes of action - Turns on own facts
Practice and procedure - Costs - Whether the defendant's offer of compromise marked 'without prejudice' is admissible in the costs hearing - Meaning of 'without prejudice' - Bases of the 'without prejudice' rule - Offer of compromise not admissible in the absence of the consent of both parties
Legislation:
Rules of the Supreme Court 1971 (WA), O 66 r 1, r 2
Supreme Court Act 1935 (WA), s 37
Result:
Costs application allowed in part
Category: B
Representation:
Counsel:
Plaintiff: Ms K R Lendich
Defendant: No appearance
Solicitors:
Plaintiff: Jackson McDonald
Defendant: In person
Case(s) referred to in judgment(s):
Amaca Pty Ltd v Hannell [2007] WASCA 158 (S)
Broadway Pty Ltd v Lewis [2012] WASC 373
Ford Motor Co of Australia Ltd v Lo Presti (2009) 41 WAR 1
J-Corp Pty Ltd v Australian Builders Labourers Federated Union of Workers (Western Australian Branch) (No 2) (1993) 46 IR 301
Kimpura Pty Ltd v JWH Group Pty Ltd [2004] WASCA 134
Letang v Cooper [1965] 1 QB 232
Oceanbulk Shipping and Trading v TMT Asia [2011] 1 AC 662
Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72
Permanent Building Society v Wheeler (No 2) (1993) 10 WAR 569
Pihiga Pty Ltd v Roche [2011] FCA 240; (2011) 278 ALR 209
R J Baker Nominees Pty Ltd v Parsons Management Group Pty Ltd [2009] WASC 206 (S)
Re Newman Air Charter Pty Ltd (1991) 5 WAR 365
Unilever plc v Procter and Gamble Co [2000] 1 WLR 2436
Walker v Wilsher (1889) 23 QBD 335
Witcombe v Talbot & Olivier [No 2] [2009] WASC 173 (S)
PRITCHARD J: I delivered my reasons for decision in this action on 9 October 2012[138] and on that date I made orders to give effect to those reasons for decision. Broadway also sought orders to the effect that Mr Lewis pay its costs of the action. As Mr Lewis had not attended nor been represented at the trial, and did not attend on 9 October 2012 when my reasons for decision were delivered, I reserved the question of costs of the action and made orders requiring that Broadway file and serve on Mr Lewis a minute of proposed orders, setting out the orders it sought in relation to the costs of the action and in relation to the costs reserved prior to trial, together with a written outline of submissions in support of those proposed orders.
[138] Broadway Pty Ltd v Lewis [2012] WASC 373. These reasons should be read in conjunction with those reasons (including the abbreviations contained in them).
Subsequently, Broadway's application for costs was listed for hearing at a special appointment on 28 November 2012 (the costs hearing), and Broadway was ordered to serve Mr Lewis with a copy of the orders of the Court containing the listing of the costs hearing. Mr Lewis did not attend, nor was he represented at, the costs hearing.
The costs order sought by Broadway
Initially Broadway sought an order that Mr Lewis pay its costs of the action and the counterclaim (including any costs reserved) to be taxed and paid on an indemnity basis and, in the alternative, an order that Mr Lewis pay Broadway's costs of the action and the counterclaim (including any costs reserved) to be taxed. At the hearing on 28 November 2012, however, counsel for Broadway advised the Court that Broadway no longer sought an order for costs in the former terms (that is, on an indemnity basis). The order now sought by Broadway is:
1.The defendant pay the plaintiff's costs of the action and the counterclaim (including any costs reserved) to be taxed.
The Court's power to make orders in relation to costs
By virtue of s 37 of the Supreme Court Act 1935 (WA), the Court has a broad discretion to make orders in relation to the costs of, and incidental to, a proceeding. As McHugh J observed in Oshlack v Richmond River Council,[139] the statutory discretion, while broadly stated, is not unqualified and the discretion must be exercised judicially in accordance with established principle and factors directly connected with the litigation.
[139] [1998] HCA 11; (1998) 193 CLR 72, 96 [65].
The most important factor which guides the exercise of the costs discretion is the result of the litigation.[140] Generally speaking, the Court will make an order that the successful party to an action recover his costs from the unsuccessful party, and this is known as the 'usual order as to costs'. This principle is reflected in O 66 r 1(1) of the Rules of the Supreme Court 1971 (WA) (RSC). As McHugh J explained:[141]
[140] Oshlack (96 ‑ 97) [66].
[141] Oshlack (97) [67].
The principle is grounded in reasons of fairness and policy and operates whether the successful party is the plaintiff or the defendant. Costs are not awarded to punish an unsuccessful party. The primary purpose of an award of costs is to indemnify the successful party. If the litigation had not been brought, or defended, by the unsuccessful party the successful party would not have incurred the expense which it did. As between the parties, fairness dictates that the unsuccessful party typically bears the liability for the costs of the unsuccessful litigation.
As Broadway was successful in the action, the starting point for considering the proper exercise of discretion with respect to costs is that Broadway as the successful party should be able to recover its costs from Mr Lewis.
However, there are exceptions to this general approach to costs. Generally speaking, these exceptions derive from the conduct of the successful party in relation to the litigation, or leading up to the litigation, which conduct is seen to disentitle that party to the benefit of the exercise of the discretion in its favour.[142] For example, 'the court may properly depart from the usual order as to costs when the successful party by its lax conduct effectively invites the litigation; - fn_LAWREP-AUS-096-LGERA-0173-FN.100#fn_LAWREP-AUS-096-LGERA-0173-FN.100unnecessarily protracts the proceedings; succeeds on a point not argued before a lower court; prosecutes the matter solely for the purpose of increasing the costs recoverable; or obtains relief which the unsuccessful party had already offered in settlement of the dispute'.[143]
[142] Oshlack (97) [69].
[143] Oshlack (97 ‑ 98) [69] (citations omitted).
There are two considerations arising from the facts of this case that appear to be relevant to the exercise of the discretion to award costs. The first is that Broadway was not wholly successful, in the sense that it was not successful in respect of all of the causes of action it pleaded. Secondly, there was some limited information before the Court which suggested that Mr Lewis made an offer to settle the litigation prior to trial.
Broadway was not successful in respect of each of its causes of action
In this action, Broadway sought:
(a)an order for possession of the Land; and
(b)damages for use and occupation of the Land by Mr Lewis on the basis that Mr Lewis was either a tenant at will or a tenant at sufferance; and
(c)in the alternative, mesne profits for trespass by Mr Lewis on the Land.
In his Amended Defence and Counterclaim Mr Lewis raised a number of issues including alleged misrepresentations in relation to the boundary of the Land, common mistake in relation to the terms of the Contract for which rectification was sought, unconscionable conduct and estoppel. All of the claims in Mr Lewis' counterclaim were dismissed.
Accordingly, Broadway was successful in respect of its claim for possession and in respect of the whole counterclaim, but not in respect of its claims for damages for use and occupation of the Land or for mesne profits for trespass.
The RSC contemplate that sometimes a departure from the usual order as to costs will be required if a successful party has not been successful on all of the issues raised in the proceedings. By way of example, O 66 r 1(3) provides:
Where a party though generally successful in an action has, by the introduction of some issue or issues on which he has failed, increased the costs the Court may order such party to pay the costs of such issue or issues.
Similarly, O 66 r 2 relevantly provides:
In the absence of any special order -
(a)where the statement of claim contains more than one cause of action and the plaintiff succeeds on one or more causes of action and the defendant succeeds on another or others, costs shall be allowed to the plaintiff on the cause or causes of action on which he succeeds and to the defendant on that or those on which he succeeds, in the same manner as if separate actions had been brought.
This may not be a case for the direct application of either rule. Mr Lewis was not present at the costs hearing and did not seek an order for costs in his favour. Further, given that Mr Lewis did not appear at the trial, his active participation in the litigation was sporadic,[144] and he was not legally represented for some of the time, whether and the extent to which he may have incurred costs in relation to those parts of Broadway's claim in respect of which it was not successful is unclear.
[144] Broadway Pty Ltd v Lewis [2012] WASC 373 [47].
In this case, it is nevertheless appropriate, in my view, to take into account Broadway's partial success in relation to the question whether, in the exercise of its general discretion under s 37 of the Supreme Court Act 1935 (WA) and O 66 r 1(1) RSC, the Court should make an order that Mr Lewis pay Broadway's costs of the action as a whole, or only for part thereof. The principles which have been developed in relation to the application of O 66 r 1(3) and O 66 r 2(a) RSC provide some guidance to the appropriate exercise of the Court's discretion as to the award of costs in the present circumstances.
Insofar as O 66 r 1(3) is concerned, the Court of Appeal in Amaca Pty Ltd v Hannell[145] made the following observations:[146]
[145] [2007] WASCA 158 (S).
[146] [2007] WASCA 158 (S) [6] ‑ [7].
The power to depart from the general rule to the effect that costs follow the event and to instead adjust the costs order to be made by reference to the failure of the generally successful party on specific and particular issues within the litigation, is recognised by practice, authority and the express provisions of O 66 r 1(3). However, its application depends upon the identification of discrete and severable issues, the litigation of which has increased the costs of conducting the proceedings. Established practice in this State, and the authorities, suggest that the exercise of this power should be approached broadly, and as a matter of impression, and without an attempt at 'mathematical precision' which is likely to prove illusory – see, for example J-Corp Pty Ltd v Australian Builders Labourers Federated Union of Workers (Western Australian Branch) (No 2).[147]
[147] (1993) 46 IR 301.
Accordingly, the power to adjust an order for costs by reference to particular issues upon which the generally successful party has failed, is properly exercised only where there are discrete and severable issues upon which the generally successful party has failed, and which have added to the cost of the proceedings in a significant and readily discernible way. In a case in which the generally successful party has failed on only a minor issue, which did not add materially to the cost of the conduct of the proceedings, it would not ordinarily be appropriate to depart from the general rule, unless the conduct of the generally successful party in relation to that issue had been unreasonable.
In Keet v Ward[148] the Court of Appeal set out the following four propositions in relation to the application of O 66 r 2(a):
[148] [2011] WASCA 139 [24].
(a)the expression 'cause of action' in O 66 r 2(a) is a reference to a factual situation, the existence of which entitles the plaintiff to obtain a remedy: Letang v Cooper;[149] Permanent Building Society v Wheeler(No 2);[150]
[149] [1965] 1 QB 232, 242 (Diplock LJ);
[150] (1993) 10 WAR 569, 572 (Anderson J);
(b)the rule does not provide an inflexible rule which prescribes a mandatory approach to the awarding of costs in cases where there are multiple causes of action. The opening words 'in the absence of any special order' indicate that the court retains the discretion to make a special order departing from the rule in O 66 r 2(a): Kimpura Pty Ltd v JWH Group Pty Ltd;[151]
[151] [2004] WASCA 134 [12] ‑ [15].
(c)however, where there are multiple causes of action and a party has succeeded on only one or some, the other party is prima facie entitled to costs on the others but the court will always attempt to do substantial justice in the circumstances: Permanent Building Society v Wheeler (No 2);[152]
[152] (1993) 10 WAR 569, 574 ‑ 575 (Anderson J).
(d)it may not be appropriate to make a costs order in accordance with O 66 r 2(a) where there is in substance one contest, that is, where the causes of action arise from the one course of dealings, the one transaction or the same facts: Permanent Building Society v Wheeler (No 2);[153] R J Baker Nominees Pty Ltd v Parsons Management Group Pty Ltd;[154] Witcombe v Talbot & Olivier [No 2].[155]
[153] (1993) 10 WAR 569, 574 ‑ 575 (Anderson J).
[154] [2009] WASC 206 (S).
[155] [2009] WASC 173 (S) (Beech J).
In essence, the submission by counsel for Broadway was that Broadway's claims for damages for use and occupation of the Land, and for mesne profits for trespass, were different legal characterisations of the same set of facts, and that those facts were part of the same set of facts on which the claim for possession was based. Counsel also submitted that the claims for damages for use and occupation and for mesne profits for trespass did not add to the costs of the proceedings in a material way.
There was clearly a close relationship between Broadway's action for possession founded as it was on Mr Lewis' occupation of the Land without an entitlement to do so, and its claims for damages arising from that occupation of the land. Looked at from that broad perspective, Broadway has a strong case for an award of all of its costs.
However, three considerations have led me to the view that Broadway should not be able to recover its costs in relation to its claims for damages for use and occupation of the Land and for mesne profits.
First, the claims for damages and mesne profits were clearly quite discrete from the claim for possession (and from the claims the subject of Mr Lewis' counterclaim).
Secondly, although there was some overlap in the factual foundations for those claims, and for the claim for possession (namely the fact of Mr Lewis' continued occupation of the Land, to the exclusion of Broadway, after any entitlement Mr Lewis had to occupy the Land pursuant to the Lease had come to an end) this overlap was limited. The factual foundation for the claims for damages and mesne profits lay largely in what the parties did and said after the Lease came to an end (which was relevant to establishing the basis on which Mr Lewis remained in occupation) and evidence directed to establishing the quantum of damages in respect of that occupation. Because Mr Lewis admitted much of Broadway's claim for possession, much of the evidence led by Broadway at the trial was directed to Broadway's claims for damages and mesne profits.
Thirdly, the inclusion of the claims for damages and mesne profits materially added to the cost of the proceedings. A significant portion of the hearing time at the trial was devoted to these issues.
Having regard to these considerations, in my view a just exercise of the discretion to award costs warrants requiring Broadway to bear its own costs in relation to its claims for damages for use and occupation, and for mesne profits for trespass.
The costs reserved
Insofar as costs were reserved during the course of the litigation, those costs pertained to two issues. On 2 July 2012 Broadway made an application to strike out the defence and for liberty to move for judgment arising from Mr Lewis' failure to comply with any of the trial directions which had been made leading up to the first listed trial date (of 7 August 2012). At a directions hearing on 3 July 2012 (which Mr Lewis did not attend in person or by counsel) orders were made programming Broadway's application for hearing and the application was listed for hearing on 30 July 2012. On 30 July 2012, counsel for Mr Lewis appeared at the hearing and indicated that he was instructed to apply for an adjournment of the trial. Broadway's application was effectively put to one side while the Court dealt with Mr Lewis' application to adjourn the trial.
Mr Lewis' application to adjourn the trial was listed for hearing on 31 July 2012. I granted that application. Broadway sought costs arising from the adjournment of the trial and its application for judgment. Costs were reserved on that occasion.
Mr Lewis should pay Broadway's costs incurred in relation to Mr Lewis' application for the adjournment of the trial and Broadway's costs thrown away by the adjournment of the trial. Mr Lewis' adjournment application (and the orders I made in light of that application) meant that it was ultimately unnecessary to deal with Broadway's earlier application to strike out the defence for non‑compliance with the trial directions, and to move for judgment. In the circumstances, Mr Lewis should pay Broadway's costs of that application also. However, consistent with the view I have taken about the costs of the action more generally, Broadway's recovery of costs in respect of these applications should not extend to such of its costs which are attributable to its claims for damages for use and occupation of the Land or for mesne profits for trespass.
The impact of the offer to settle which was made by Mr Lewis
In support of its application for costs as originally framed (and in relation to its claim for indemnity costs) Broadway filed an affidavit sworn by Tennille Maree Provost on 17 October 2012 to which Ms Provost annexed copies of three letters from Broadway's solicitors to Mr Lewis' solicitors. One of those letters (dated 23 March 2012) contains a reference to an email dated 21 March 2012 from Mr Lewis' then solicitors and to Mr Lewis' 'settlement proposal detailed therein' (the March email). A copy of the March email was not attached to Ms Provost's affidavit.
Subsequent correspondence annexed to Ms Provost's affidavit makes clear that the offer of settlement which was apparently contained in the March email was rejected by Broadway. Had an offer of settlement made by Mr Lewis been unreasonably rejected,[156] a question may have arisen as to whether Broadway was entitled to its costs after that point in time. Counsel for Broadway advised the Court that the March email had not been provided to the Court because it was marked 'without prejudice'.
[156] Cf Ford Motor Co of Australia Ltd v Lo Presti (2009) 41 WAR 1, 8 [16] ‑ [19] (Buss JA, Wheeler JA agreeing).
A document marked 'without prejudice' is ordinarily not admissible without the consent of both parties to the litigation.[157] The legal principles in relation to the rule that a document marked 'without prejudice' is inadmissible were considered in some detail by Lander J in Pihiga Pty Ltd v Roche.[158] The rule protects not only admissions in the form of an offer to settle, but also communications between parties generally in respect to issues in the dispute including assertions made of the strength and weakness of a party's case or an opponent's case.[159]
[157] Walker v Wilsher (1889) 23 QBD 335, 337 (Lord Esher MR), 338 (Lindley LJ); see also Re Newman Air Charter Pty Ltd (1991) 5 WAR 365, 368 ‑ 369 (White AJ).
[158] [2011] FCA 240; (2011) 278 ALR 209.
[159] Pihiga [81].
As Lander J noted, there are two bases for the rule. The first lies in public policy, in that the existence of the rule encourages parties to engage in full and frank discussions aimed at settling their disputes without recourse to the courts. Secondly, the rule is founded on the express or implied agreement of the parties that the communications between them should not be admissible in evidence if those communications do not lead to a settlement.[160]
[160] Pihiga [83] ‑ [86] citing Unilever plc v Procter and Gamble Co [2000] 1 WLR 2436, 2448 ‑ 2449 (Robert Walker LJ) and Oceanbulk Shipping and Trading v TMT Asia [2011] 1 AC 662 [27] (Lord Clarke).
There are, however, exceptions to the rule. They were set out by Robert Walker LJ in Unilever plc v Procter and Gamble Co.[161] One of those exceptions is for an offer expressly made 'without prejudice except as to costs', by which the parties expressly or impliedly agree that their communication will not be admissible save in the context of determining costs.[162] This exception is consistent with that basis for the rule which lies in the agreement of the parties. Counsel for Broadway confirmed that the March email was marked 'without prejudice' and not 'without prejudice save as to costs'.
[161] [2000] 1 WLR 2436, 2444 ‑ 2445.
[162] Unilever [2445] and the authorities cited therein.
Following the costs hearing, the Court contacted the solicitors for Broadway, and Mr Lewis, to enquire whether the parties would consent to the provision to the Court of the March email so that that email could be considered in relation to the question of costs. Neither Mr Lewis nor Broadway gave consent to the provision to the Court of the March email. Consequently the contents of that email were not able to be considered by the Court on the question of costs.
Whether the March email, and Broadway's refusal of the settlement offer contained therein, would have had any implication for Broadway's application for costs is an entirely different question about which it is not appropriate to speculate. The Court is only able to determine Broadway's application for costs on the basis of the material before it and nothing in that material suggests that Broadway should not have its costs (limited as I have already indicated).
Conclusion
For these reasons, in my view the just exercise of the Court's discretion in relation to costs in the circumstances of this case warrants the making of an order in the following terms:
1.The defendant do pay the plaintiff's costs of the action and the counterclaim (including any reserved costs), other than the plaintiff's costs in relation to its claims for damages for use and occupation of the Land, and its claim for mesne profits for trespass, to be taxed.
- AGLC
- Broadway Pty Ltd v Lewis [2012] WASC 373
- Case
- [2012] WASC 373
- Decision Date
CaseChat Overview and Summary
The court examined the nature of Lewis' occupation of the land and the circumstances surrounding his continued presence after the lease expired. The court found that Broadway's active dissent to Lewis' occupation, manifested through threats to dispossess him and a letter from Broadway's solicitors, precluded Lewis from being a tenant at sufferance. The court held that a tenant at sufferance must hold over without the landlord's active objection, and Broadway's conduct demonstrated an active objection to Lewis' continued occupation. Consequently, the claim for damages for use and occupation was dismissed. The court also discussed the doctrine of 'trespass by relation' and the prerequisites for an action for mesne profits, but these issues were not directly relevant to the outcome of the case.
The Supreme Court of Western Australia dismissed Broadway's claim for damages for use and occupation of the land. The court found that Lewis was not a tenant at will or a tenant at sufferance, as Broadway's active objection to his continued occupation precluded such a finding. The court did not award any damages for use and occupation, as the claim was dismissed on the basis that Lewis was not a tenant at sufferance. The court did not make any orders regarding the action for possession of the land, as this aspect of the case was not fully argued or determined.
Additional orders may be made regarding the action for possession of the land, depending on the outcome of any further proceedings. The dismissal of the claim for damages for use and occupation does not affect Broadway's right to seek possession of the land. The court's decision on the nature of Lewis' occupation is final and binding on the parties. The court's findings on the doctrine of 'trespass by relation' and the prerequisites for an action for mesne profits are obiter dicta, as these issues were not directly relevant to the outcome of the case.
Orders
Orders of the court
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Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
A tenant at sufferance is the label which is usually given to a tenant who lawfully enters into occupation of premises (pursuant to a lease, for example), and, after that period of lawful occupation has ceased, continues in occupation without the the owner's assent or dissent.[101] Thus a tenancy at sufferance is not, strictly speaking, a tenancy at all, but a holding over by wrong.[102] A tenant at sufferance may therefore be contrasted with a tenant at will in that the former occupies the premises by right, whilst the latter holds over by wrong after the expiration of the lawful title.[103][101] Natural Gas and Oil Corporation Ltd (In Liq) v Byrne and Boyle (1951) 68 WN (NSW) 207, 213 (Herron J) citing Blundell L, Woodfall's Law of Landlord and Tenant (24th ed, 1939) 285; Individual Homes Pty Ltd (In Liq) v Martin [1999] ACTSC 139 [36] (Higgins J).[102] Simms v Lee [1945] 45 SR (NSW) 352, 354 (Roper J).[103] Natural Gas and Oil Corporation Ltd (In Liq) v Byrne and Boyle (1951) 68 WN (NSW) 207 at 213 (Herron J) citing Blundell L, Woodfall's Law of Landlord and Tenant (24th ed, 1939) 285. The category of tenants at sufferance has been confined to persons who hold over without the assent or dissent of their landlord. It does not include persons who hold over wrongfully in spite of the active objection of their landlord.[104] Threats to enter and dispossess a person occupying premises constitute the active dissent of the landlord to the wrongful holding over.[105][104] Remon v City of London Real Property Co [1921] 1 KB 49, 58 (Scrutton LJ).[105] Simms v Lee [1945] 45 SR (NSW) 352, 354 (Roper J). The evidence does not establish, on the balance of probabilities, that Mr Lewis was a tenant at sufferance. Had there been no evidence of any objection by Broadway to Mr Lewis' continued occupation of the disputed land, either prior to, or immediately after, settlement, then it might have been possible to construe Broadway's silence in the period between 2 March 2005 and 10 November 2009 as neither assent nor dissent to that continued occupation. However, for the reasons I have set out above, Broadway's conduct immediately before and after the settlement manifested an active dissent to Mr Lewis' continued presence on the disputed land after the settlement. In the face of that active dissent, and absent any other evidence, Broadway's silence in the period from 2 March 2005 to 10 November 2009 cannot be construed as indicating that Broadway resiled from its dissent, so as to tacitly permit Mr Lewis' continued presence.[106] That Broadway never resiled from its position is made clear in the letter dated 25 August 2010 from its solicitors to Mr Lewis, to which I have already referred. My finding that Mr Lewis was not a tenant at will or a tenant at sufferance means that Broadway's claim for damages for use and occupation must fail. However, in case I am wrong in this conclusion, it is appropriate that I briefly set out the quantum of the damages I would have awarded had Broadway's claim for use and occupation been made out.