Cacas v Megameg P/L - [2016] SADC 73

District Court of South Australia
(Civil: Interlocutory Application)
CACAS v MEGAMEG P/L
[2016] SADC 73
Reasons for Rulings of His Honour Judge Beazley (ex tempore)
24 June 2016
EQUITY - GENERAL PRINCIPLES - EQUITABLE ESTATES AND INTERESTS - GENERALLY
EQUITY - EQUITABLE REMEDIES - INJUNCTIONS - INTERLOCUTORY INJUNCTIONS - JURISDICTION AND GENERALLY
The plaintiff issued proceedings on 25 August 2015 seeking an injunction to restrain the defendant, as the registered proprietor of premises at 127 Hindley Street, Adelaide, from evicting her as tenant of the ground floor of those premises. The plaintiff asserted, at that time, that she had an equitable interest as tenant to occupy the subject premises to conduct her pharmacy business. The plaintiff did not at that time assert any right to occupy dilapidated premises on the first floor level, nor any entitlement to possession of the adjoining premises at 127A Hindley Street.
In October 2015, the defendant approved a change of use for the first floor and advertised the first floor for lease. On 6 November 2015 the parties commenced a mediation before a judge of the court to attempt a resolution of the plaintiff's status as tenant of the ground floor.
The defendant asserts that the plaintiff's claim was compromised at that mediation. Pursuant to the terms of the settlement, the defendant forwarded a draft lease for five years, of the ground floor, to the plaintiff.
The plaintiff now denies that the proceedings were resolved at mediation. The plaintiff has remained in possession of the ground floor as tenant.
The defendant has expended sums in renovating the first floor to enable it to be leased. It painted over signage on the exterior wall of the first level. That signage together with subsisting signage on the ground floor had advertised the plaintiff's ground floor business. The plaintiff has threatened to take unilateral action to repaint the signage on the first floor exterior wall. She has refused to give an undertaking to refrain from such action until the resolution of the proceedings.
The plaintiff now asserts an entitlement to the freehold of the whole of the premises at 127 Hindley Street and the adjoining premises at 127A Hindley Street, Adelaide.
(1) The defendant sought an interlocutory injunction to restrain the plaintiff from so acting - status of the plaintiff - whether the defendant, in painting over the signage, has derogated from its grant to the plaintiff - the plaintiff, for the first time, asserts that she is entitled to an equitable interest in the freehold of the whole of the premises.
Held: Application by the defendant for an interlocutory injunction against the plaintiff restraining her from in any way interfering with the exterior wall of the first floor of 127 Hindley Street, granted.
(2) The plaintiff sought an interlocutory injunction to restrain the defendant from granting a lease to 'AC' of the first floor of the premises - whether balance of convenience favours the grant of an injunction in a case where undertakings given by the defendant and 'AC'.
Held: Application by the plaintiff for an interlocutory injunction against the defendant dismissed.
District Court Act 1991 (SA) s 31; Evidence Act 1929 (SA) s 67C(1), referred to.
Karagiannis v Malltown Pty Ltd (1979) 21 SASR 381; Advance Fitness Corporation v Bondi Diggers Memorial & Sporting Club Inc [1999] NSWSC 264; Carbure Pty Ltd v Brile Pty Ltd [2002] VSC 272; Todbern Pty Ltd v Taormina (1990) BPR 11,173; Impact Funds Management Pty Ltd v Roy Morgan Research [2016] VSC 221; Kelly v Alternative Web Pty Ltd [2010] SASC 4; Harrem Pty Ltd v Toyo Tyre Rubber Australasia Ltd [2008] NSWSC 776; Bahr v Nicolay (No 2) (1988) 164 CLR 604; Dietrich v Denning [2016] NSWSC 597; Despot v Registrar-General (NSW) [2016] NSWCA 5; Carter v Brine [2015] SASC 204; Nguyen v Phan [2015] VSC 32; Cassegrain v Gerard Cassegrain & Co Pty Ltd [2015] HCA 2; Pizimolas v Pizimolas [2010] SASC 158; Gillet v Holt [2001] Ch 210; Evans v Evans [2011] NSWCA 92; Australian Broadcasting Corporation v O'Neill (2006) 227 CLR 57; Briggs v Jones [2013] SADC 42; Delaforce v Simpson-Cook (2010) 78 NSWLR 483; Ronowska v Kus [2012] NSWSC 280; Giumelli v Giumelli (1999) 196 CLR 101, considered.

CACAS v MEGAMEG P/L
[2016] SADC 73
Introduction

The plaintiff and the defendant, each respectively, bring an application seeking an interlocutory injunction to restrain the other, from engaging in certain conduct in respect of the real property situate at 127 Hindley Street, Adelaide (the subject property). The defendant is the registered proprietor of the subject property, which consists of a two storey building.
The plaintiff conducts a pharmacy business on the ground floor of the subject property. For many years the first floor of the subject property has been in a dilapidated state.
These applications are part of a longstanding dispute between members of the extended Cacas family as to possession of the subject property.
I will deal with each application separately, however there is a common factual matrix. Each involves complex issues of law.
The principal proceedings
The principal proceedings were commenced by the plaintiff on 25 August 2015, at which time she sought an injunction to restrain the defendant from evicting her from the ground floor of the subject property. Despite the fact that there was no subsisting lease between the plaintiff and the defendant at that time, the plaintiff asserted that she was entitled, in consequence of an equitable interest, to remain as tenant of the ground floor premises.
The directors of the defendant, and the plaintiff are members of the wider Cacas family. For about 60 years the plaintiff’s immediate family has occupied and operated a ‘night chemist’ at the ground floor premises. The plaintiff’s father was the brother of Michael Cacas, a director of the defendant. They managed to conduct their respective businesses on an informal basis. There appears to have been no dispute between them during the lifetime of the plaintiff’s father. Unfortunately, the same cannot be said of the present parties. At issue, in 2015, was whether the plaintiff had any right, at law or in equity, to occupy the ground floor premises as tenant.
A mediation
On 6 November 2015 the respective parties were referred to a mediation before a Judge of this Court. In light of the allegations made against each other, and the extended family relationship, it was the proper course to take.
In Evans v Evans,[1] the Court of Appeal (NSW) said:
… a mediation can deal with aspects of the relationship, both past and future, of the parties to a dispute in a way that is not possible for court proceedings, when a dispute involves members of a family, as the present one does, that feature of mediation can make it a particularly useful tool for dispute resolution.
[1] [2011] NSWCA 92 at [146].
No pleadings had been filed at that time. Negotiations for a five year lease had commenced in April 2014. At that time the plaintiff had taken over the business of Cacas Night Chemist from her late father. No agreement had been reached as to the terms of such a lease. Some disputes concerned the question of rent and the outgoings. However, personal issues also arose. The defendant asserted that the plaintiff had improperly approached the ill Michael Cacas without its approval.
The fact remains that there had never been a concluded agreement for lease, prior to the mediation. The plaintiff has continued to occupy the ground floor premises. She asserted that the defendant’s notice to evict was invalid. The defendant asserted that the plaintiff had paid a rental sum far below any reasonable valuation.
On 11 November 2015 it was announced that agreement had been reached by the parties to compromise the action. Orders were made by the Court consequent upon that agreement to settle the proceedings. One of the terms of that agreement was that a lease would be granted by the defendant to the plaintiff to occupy, as tenant, the ground floor premises of the subject property. An order for payment in of the provisional rental was made. The plaintiff did not seek, nor was she granted the right to occupy the then dilapidated first floor premises.
The conduct of the plaintiff post mediation
The defendant’s solicitor forwarded a draft lease to the plaintiff’s solicitors. Thereafter numerous discussions took place and correspondence was sent between the respective solicitors for the parties, as to the terms of such a lease. Some of that correspondence is attached to affidavits sworn by the solicitor Loretta Polson. There was initially a dispute as to the terms of such a lease. The plaintiff refused to execute the draft lease.
This would, in the ordinary course, raise the complex question as to the scope for implying terms,[2] and an order made for specific performance.
[2] Hall v Busst (1960) 104 CLR 206; Galaxy Media Pty Ltd v Andrew (2001) NSWSC 917; Kymbo Pty Ltd v Paxton Management Pty Ltd [2001] NSWSC 792.
However the plaintiff now denies that any agreement to compromise the action was reached at the mediation.
·Orders of a Master
Eventually on 19 April 2016, orders were made by a Master of this Court requiring the plaintiff to file and serve a statement of claim on or before 17 May 2016. The defendant was ordered to file and serve a defence and cross-claim. It was anticipated that the defendant would plead the compromise of the action at the mediation conference as a bar to the plaintiff’s claim. The plaintiff was given leave to file and serve a reply, and a defence to cross-claim on or before 21 June 2016.
Those procedural matters were put in place so that the action would return to the Master on 1 August 2016. It was anticipated that the Master would then determine how the matter should proceed to trial.
The plaintiff’s expanded claim
I repeat that, at that time, the principal issue involved the status of the plaintiff, merely as a tenant of the ground floor premises. While the issue of an alleged equitable interest, as a tenant, would have involved an interesting, if somewhat complex question of law, an early trial of that narrow issue would have been ordered.[3]
[3] See Delaforce v Simpson-Cook (2010) 78 NSWLR 483; Pizimolas v Pizimolas [2010] SASC 158; Ronowska v Kus [2012] NSWSC 280; Giumelli v Giumelli (1999) 196 CLR 101.
The nature of the plaintiff’s claim has subsequently changed dramatically, in consequence of allegations made in documents filed yesterday, on 23 June 2016. The plaintiff asserts, for the first time, that she has an equitable interest in the freehold of the whole of the subject property, and not merely as a tenant.
She bases this expanded claim upon a document apparently executed by her late father and his brother, Michael Cacas, in 2006. She asserts that the document constitutes an acknowledgement that the freehold of the subject property and indeed an adjoining property, ‘was paid for’ by her late father, and beneficially owned by him. On her construction of that document, title to each of those properties was to vest in her upon her father’s death.
She seeks to join her mother as trustee of her late father’s estate. She also seeks to join Michael Cacas as a defendant.
The defendant has not had the opportunity to investigate those fresh allegations. It will take some time for it to be in a position to respond to them, because of the health of Michael Cacas.
The draft statement of claim, enclosed with those documents, raises at least two alternative claims by the plaintiff. The first is that she has an equitable interest as tenant in both the ground floor and the first floor of the subject property.
The second seeks recovery of an alleged debt from Michael Cacas in his personal capacity; and relief against him, in respect of the freehold, as a director of the defendant. She claims against the defendant on the basis of the alleged document signed by Michael Cacas.
That plaintiff asserts that it constitutes an acknowledgement that certain arrangements were entered into by them. The document appears to have been signed by both brothers and witnessed by Zacharoola Athas, in 2006. The plaintiff asserts that the interest discussed in that document, is that of equitable ownership of the pharmacy building at 127 Hindley Street, Adelaide. The document asserts that Michael Cacas, then a director of the defendant Megameg, had acknowledged that the plaintiff’s father, Don George Cacas, was the owner of 127 and 127A Hindley Street. It purports to record that Don George Cacas had paid Michael Cacas in full for the property. The document further noted that Michael Cacas had confirmed that there is no need for a lawyer as ‘the certificate of title had been changed to reflect this’.
The document further noted that, ‘if something happens to ‘Don or Michael’, the pharmacy building will automatically go to Don’s daughter’, the plaintiff. The author of the document recorded that Michael and Don had said that this has been discussed and ‘documented with Tom Ford as well’. It was further recorded that Michael had signed, ‘categorically, that the ownership of 127 and 127A Hindley Street will automatically transfer to Ms Maria-Mandy Cacas’.
Now, on the face of the document, irrespective of whatever legal effect it may have in due course, there is some evidence in support of an argument that at least Michael Cacas, in some form, had intended that the subject property be held on trust for the plaintiff and her father. Whether ‘the subject property’ was the land or simply the business and lease of the pharmacy will need to be determined in due course. See Despot v Registrar-General (NSW).[4]There may be an issue as to the defendant’s indefeasible title. See Bahr v Nicolay (No 2)[5] and Despot’s case, supra.
[4] [2016] NSWCA 5.
[5] (1988) 164 CLR 604.
These fresh allegations will inevitably raise even more complex issues of law. Amongst them will be the status of the document and whether it was ever intended to create legal rights; whether it was no more than an agreement to agree – that is subject to contract; whether the parties have waived any rights under the document; whether in fact the plaintiff’s father had paid for the purchase of the subject property; whether Michael Cacas signed the document in his personal capacity only; whether he was, in fact, authorised to enter into such an arrangement by the defendant company; whether the plaintiff has acquiesced in the defendant continuing as the registered proprietor by her conduct; what was the basis for the defendant continuing as if landlord and the plaintiff as tenant; whether the defence of laches applies; and whether the defendant company had obtained an indefeasible title to the subject property.[6]
[6] See Cassegrain v Gerard Cassegrain & Co Pty Ltd [2015] HCA 2; Bahr v Nicolay (No 2) (1988) 164 CLR 604; Despot v Registrar-General (NSW) [2016] NSWCA 5; Dietrich v Denning [2016] NSWSC 597; and Nguyen v Phan [2015] VSC 32.
On any view the length of trial will be considerably increased by these issues. In the circumstances there is no utility in further detailing the relationship between the plaintiff and the principals of the defendant.
The conduct of the defendant, post mediation, which the plaintiff seeks to impugn
In October 2015 the defendant had approved the change of use for the first floor of the subject property. Those premises were in a dilapidated condition.
While the plaintiff asserts that they had been occupied by a Greek men’s coffee club for many years, and that her father had paid water rates in respect of them, it is plain that the club members had abandoned the premises. The plaintiff has not, until recently, asserted a right to occupy the first floor.
Following the mediation, the defendant embarked upon the renovation of the first floor of the subject premises, with the intention to lease it for commercial purposes. It asserts that any claim by the plaintiff against it was resolved at the mediation.
It placed a sign advertising the premises on the exterior of the first floor wall. This did not provoke a response from the plaintiff. It subsequently decided to lease it to one of its directors, Anthony Cacas, so that he may conduct his legal practice, from that site.
Without consulting the plaintiff, it caused the exterior of the first floor wall to be painted. For some 60 years that wall had contained signage advertising the ground floor ‘Cacas Night Chemist’, painted in English and in Greek. It also contained a fluorescent sign advertising the chemist business, which sign remains. The defendant asserts that there was no need to advise the plaintiff in advance. It owned and occupied the first floor. The plaintiff had not sought possession of it.
Its purpose in doing so was said to enable the first floor tenancy to be advertised.
The effect of the painting by the defendant was to delete the painted advertising on the wall. This can be seen clearly from photographs annexed to the affidavit of Anthony Michael Cacas sworn on 17 June 2016.
The fluorescent sign remains, as does the plaintiff’s extensive signage on the outside of the ground floor premises.
Before dealing with each application, I set out the principles of law, relevant to the grant of injunctive relief.
The principles of law
The principles upon which a court should act in respect of an application for injunctive relief are not in doubt.
In Australian Broadcasting Corporation v O’Neill,[7] Gummow and Hayne JJ referred to the principles explained in the Beecham Group Ltd case in which the court addressed the two main enquiries:
The first is whether the plaintiff has made out a prima facie case, in the sense that if the evidence remains at it is there is a probability that at the trial of the action the plaintiff will be held entitled to relief … The second enquiry is … whether the inconvenience of injury which the plaintiff would be likely to suffer if an injunction were refused outweighs or is outweighed by the injury which the defendant would suffer if an injunction were granted.
[7] (2006) 227 CLR 57 at 65.
Their Honours then explained:
By using the phrase ‘prima facie case’ their Honours did not mean that the plaintiff must show that it is more probable than not that at trial the plaintiff will succeed; it is sufficient that the plaintiff show a sufficient likelihood of success to justify in the circumstances the preservation of the status quo pending the trial. That this was the sense in which the court was referring to the notion of a prima facie case is apparent from an observation to that effect made by Kitto J in the course of argument. With reference to the first enquiry, the court continued in a statement of central importance for this appeal again:
‘How strong the probability needs to be depends, no doubt, upon the nature of the rights (the plaintiff) asserts and the practical consequences likely to flow from the order he seeks’.
In addition to those ‘two main enquiries’ is the question whether, in the circumstances of each respective application, an order for damages is not an adequate remedy.
· The application brought by the defendant
By letter dated 15 June 2016 to the defendant’s solicitors, the solicitors for the plaintiff asserted that it was an implied term of the ‘lease’ that the plaintiff was entitled to maintain ‘their’ signage on the exterior wall of the first floor, as it had been in place for 60 years. They asserted that:
In painting the exterior of the Level 1 premises and deleting the pharmacy signage and Greek signage Megameg has flagrantly interfered with our client’s right of quiet use and enjoyment of the premises and arguably is in contravention of the undertaking which we understand was given by your client at the commencement of the proceedings.

Those solicitors demanded that the defendant replace the signage and repaint the wall in its previous colours which had identified the plaintiff’s business; and to do so ‘without obstructing or frustrating the pharmacy’s trade’.
The letter then recorded their instructions that ‘should this not occur, our client will replace the signage at your client’s cost’
In consequence of what was reasonably perceived by the defendant to be a threat of unilateral action by the plaintiff, it seeks an injunction restraining the plaintiff and/or her agents, howsoever, from amending, removing, or in any way interfering with the painting and signage situated on the external wall of the premises at Level 1, 127 Hindley Street, being that area of the exterior wall above the verandah to the height of the building.
As is obvious, the plaintiff did not apply for a mandatory injunction obliging the defendant to rectify the wall. Apart from the difficulties in proving her claim, she would have been obliged to give an undertaking as to damages.
Both parties had given an undertaking on 17 June 2016, to refrain from any such acts in respect of the external wall of the subject property, but only until this application was heard.
The defendant has intimated, through its counsel Mr Bryant, that it will extend the undertaking until trial.
Mr Dal Cin, counsel for the plaintiff, informed the Court, that the plaintiff would not consent to any extension of that undertaking to refrain from acting unilaterally to repaint the wall. He submitted that the plaintiff regarded the status quo as being the state of the exterior wall prior to its painting by the defendant.
It is plain, that unless restrained, the plaintiff will attempt to reinstate the advertising and colour scheme on the exterior wall of the first floor.
In light of the plaintiff’s expressed position, it has become necessary for the Court to urgently consider whether an injunction ought be granted, to restrain the plaintiff from so acting.
·The submissions
Counsel for the plaintiff highlighted the fact that the subject premises, even if it were the ground floor premises only, had been occupied by the plaintiff and her family for 60 years. The signage was important in that it attracted custom to her downstairs pharmacy. He submitted that the Court ought to infer that customers of the plaintiff’s pharmacy might assume that the pharmacy had ceased to operate or would shortly do so. While I accept that any change to the advertising, even on the first floor, may lead to such questions being asked, the fact remains that the signage on the exterior wall of the ground floor level remains in place, and the ground floor premises remain open.
Mr Dal Cin submitted that the defendant had not acted with clean hands, by having acted unilaterally. He submitted that it had acted unilaterally in painting the exterior wall, and the Court could infer that some loss had been suffered by the plaintiff.
Accordingly, he submitted that, in the exercise of my discretion, I ought to refuse to grant injunctive relief to the defendant.
There is no doubt that a court might imply a term in a lease between a landlord and a tenant to ensure that the landlord does not derogate from its grant. In Karagiannis v Malltown Pty Ltd,[8] the landlord had discontinued the operation of lifts which had provided access to the plaintiff’s leased premises at the top of that building. The court held that a covenant ought be implied in the lease to the effect that the landlord could not, during the term of the lease, vary, or withhold the facilities provided for the benefit of the tenant. In the absence of such a term the tenant would be deprived of an essential facility provided when the lease was executed. In that case the customers could not easily access the fifth floor, without the lifts.
[8] (1979) 21 SASR 381.
The Court made orders on three bases. Firstly, that the expressed terms of the lease themselves provided for the continuation of the lifts; secondly, that, by implication, a term for their continued use, was necessary to give business efficacy, and that such a term was so obvious, that it went without saying that such a term had to be implied. Finally, that the landlord should not be permitted to derogate from its grant.
By contrast in, Advance Fitness Corporation v Bondi Diggers Memorial & Sporting Club Inc,[9] the Court held that no term should be implied requiring the landlord to consent to repairs. It refused the application notwithstanding the fact that the tenant would be financially disadvantaged, if no term was implied.
[9] [1999] NSWSC 264.
Similarly, in Carbure Pty Ltd v Brile Pty Ltd[10] a tenant submitted that a term ought be implied in a lease that the landlord undertake certain repairs to the exterior of the demised premises. This was a commercial lease. It was accepted that in the absence of such a term the tenant would suffer losses. The Court declined to imply such a term saying that the general practice is that the landlord is not responsible to undertake that work. The Court was not satisfied that such a term could be regarded as reasonable nor that it was necessary to give business efficacy to the contract. His Honour could not be satisfied, that such a term was so obvious that it went without saying that the parties would have expressed such a term in the lease.
[10] [2002] VSC 272.
In Todbern Pty Ltd v Taormina[11] the Supreme Court of New South Wales dealt with what was said to be an alleged lease in respect of premises which had been occupied for 30 years. Each of the tenants of the shopping centre had the benefit of free car parking spaces for its customers. The landlord indicated to its tenants that it intended to convert the car park to a commercial car park. The tenant asserted this was a breach of quiet enjoyment of the premises. It asserted that the lease provided for the use in common with all others, of the roads, the walks, the common areas and other facilities, so that the existence of a free car park was an appurtenance at the time of the grant.
[11] (1990) BPR 11,173.
The Court held that the conversion of what had been a free car park to a commercial operation did substantially affect the activity of the persons who attended. It therefore amounted to a breach of the covenant of quiet enjoyment.
In the case of Impact Funds Management Pty Ltd v Roy Morgan Research[12] the Court concluded that, as there was nothing in the clause of the lease which could have given rise to such a condition, the landlord had no obligation in that case to extend its lifts, to the roof top and basement.
[12] [2016] VSC 221.
Similar issues were dealt with by Kourakis J in Kelly v Alternative Web Pty Ltd.[13]
[13] [2010] SASC 4.
These submissions were based upon the status of the plaintiff as a tenant. While there is some merit in the submission that the deletion of signage may remove a benefit given to the plaintiff as tenant, and as such constitute a derogation from a grant, the fact is in the subject case, there is no subsisting lease. Even if there were such a lease, it cannot be said that it goes without saying that a term permitting the continued use of the exterior wall of other premises would have been included.
In addition the plaintiff refers to her draft pleading in which she asserts an entitlement in equity to an estate in fee simple over the whole of the subject premises, including the first floor.
In considering whether the defendant has established ‘a sufficient likelihood of success, it is trite that, at issue, is the nature of the rights it asserts, and the practical consequences likely to flow from the grant of an injunction’.
The document produced by the plaintiff, prima facie, constitutes cogent evidence of a claim against Michael Cacas. Even if such rights are enforceable against him, it is quite another issue as to whether she will succeed against the defendant.
At present the defendant is the registered proprietor of the subject premises. The plaintiff does not have a subsisting lease of even the ground floor premises. The defendant asserts that the plaintiff’s claim was resolved at mitigation. Save for the recent allegations, the plaintiff has no claim in law in respect of the first floor premises. The plaintiff does not seek a mandatory injunction requiring the defendant to repaint the exterior wall of the first floor. The rights of Anthony Cacas to establish his practice on the first floor had intervened, before the fresh allegations were made by the plaintiff. He has already spent $10,000 in the renovating the first floor and expects to commence trading on 1 July 2016.
What consequences flow from either the refusal or grant of an injunction?
Mr Dal Cin submits that Mr Cacas does not need signage on the exterior wall because ‘a solicitor’s practice is of a different nature to other commercial premises’. I do not accept that submission. Mr Cacas is establishing a new practice, and I infer that advertising on his premises would be essential.
By contrast the pharmacy has been operating for 60 years. The signage on the ground floor premises remains. To repaint the first floor exterior wall, would convey to the world that the pharmacy operates on both the ground and first floor, to the exclusion of Mr Cacas’ practice.
A similar submission that Mr Cacas ought establish his practice elsewhere, is, with respect, devoid of merit. Until the plaintiff’s newly expanded claim, is determined, the defendant remains as the registered proprietor of the subject premises.
At its highest, the combination of an asserted derogation of a right in the plaintiff to use the wall for advertising, and the alleged equitable proprietary right to the freehold, does not justify the refusal of the injunctive relief.
The significant issue before me is whether I should permit the plaintiff to inflame the position by acting unilaterally to repaint the exterior wall of the first floor premises. While the plaintiff’s reaction to the defendant’s painting of the exterior wall is understandable, it does not justify her proposed conduct.
The fact of the matter is that, until the issues which have now been raised by the plaintiff are finally determined, the defendant had the right to lease out the first floor and to seek customers for that newly created tenancy.
If any loss is established by the plaintiff for any proved derogation of the grant of a lease, then such damages would constitute an adequate remedy. If the plaintiff succeeds on her claim under the ‘document’, then she will be able to recover any rental payments as ‘damages’ or other equitable relief. In my opinion the defendant ought be permitted in the meantime to make use of the subject premises.
The balance of convenience overwhelmingly favours the defendant. In addition the defendant and Mr Anthony Cacas will give undertakings in writing to take no further action, with respect to the signage, until further order.
The fluorescent sign which still advertises the downstairs pharmacy will remain in place.
Conclusion
Subject to the appropriate undertakings being filed, I order:
1.   That the plaintiff and/or her agents be prevented from amending, removing or in any way interfering with the signage situated on the external wall of the premises situated at Level 1, 127 Hindley Street being described as above the verandah to the height of the building identified in the annexure of Anthony Cacas, until further order.
2.   That the defendant file the executed undertakings by 4.30pm on Monday 27 June 2016.
3.   That the question of costs be reserved to the trial judge.
·   Application brought by the plaintiff
This is an application brought by the plaintiff, dated 23 June 2016, for an injunction to restrain the defendant, the registered proprietor of premises situate at 127 Hindley Street, Adelaide from leasing the first floor of those premises to Anthony Michael Cacas. I do not propose to repeat the background facts, which were detailed by me in respect of the application for injunctive relief issued by the defendant.
The application by the plaintiff is to restrain the defendant from, carrying out any fit-out work or renovation works to the first floor of the land at 127 Hindley Street, Adelaide, unless first having obtained the consent of the plaintiff in writing; interfering with the use and occupation of the first floor and ground floor of the premises by the plaintiff; and, from granting any lease, licence or other right of possession, occupation or use to Anthony Cacas or any other person, of the first floor of the premises.
In support of the application a detailed affidavit was filed by the plaintiff which raised a series of alternative claims, in particular an allegation that she has a right in equity, to an estate in fee simple, to the whole of the premises at 127 Hindley Street, Adelaide and indeed the premises at 127A Hindley Street.
I also do not propose to repeat the relevant principles of law. Amongst the various submissions made on behalf of the plaintiff, her counsel, Mr Dal Cin submitted that the grant of any lease may constitute a clog on the title of the subject premises if she were ultimately to succeed on ‘the document’. This was because Mr Cacas might seek to lodge a caveat; or demand an entitlement to a 5 year lease under the Retail and Commercial Leases Act, 1995, SA.
I am prepared to accept, for the purposes of argument, that there is a serious issue to be tried, namely that someone, whether it be the plaintiff or someone else, may have some form of equitable proprietary right to the subject land.
It is the second limb which presents a significant hurdle for the plaintiff. I do not accept that the plaintiff is likely to suffer any injury or detriment if her application for an injunction is refused. I make that finding in light of certain undertakings which have been made by the defendant and by Mr Cacas, as explained hereafter.
In my opinion no damage could be suffered at all by the plaintiff if the injunction was refused. Her claim to title to the premises will not be resolved for some time. She continues in possession of the ground floor without a lease until the proceedings are resolved or until further order.
As to her assertion that she has the right to occupy the first floor of those premises, it is plain that to date she has not occupied the first floor, irrespective of what might have occurred previously and as to what right she might have.
There will be no damage suffered by her, in that sense, if the first floor premises are able to be let out, so long as her future title is not adversely impacted.
Counsel for the plaintiff submitted that the premises should also not be leased to Mr Cacas because of the ongoing ill-will between the parties to these proceedings.
In my opinion it is in the best interests of everyone that if the premises were able to be leased, that they do be leased by Mr Cacas. Any other tenant permitted to occupy these premises may indeed assert some entitlement to remain for five years pursuant to the Retail and Commercial Leases Act 1995.
In the subject case Mr Cacas will give undertakings that there will be no registered lease over the premises, and will disavow any entitlement to a statutory lease pursuant to the Retail and Commercial Leases Act. Accordingly the plaintiff’s future title, would not be adversely impacted.
In my opinion each party should put the question of ill will to one side. However any such ill will would increase exponentially if premises were not leased to Mr Cacas. I repeat that the defendant remains as the registered proprietor of the freehold of the premises and will do so until a court determines otherwise. It should not be prevented from obtaining some income from the first floor. I have already noted that it asserts that the plaintiff remains on the premises without a lease and by payment of an uncommercial rent.
It is hardly in its interest to cause any difficulties while Mr Cacas is establishing his legal practice at the first floor.
The plaintiff’s position will be protected by there being no encumbrance upon the freehold premises; no registered interest by way of a lease and no entitlement to a lease for a five year period.
I then turn to the potential damage to the defendant if in fact the injunction were granted.
Its position is to be contrasted with that of the plaintiff. It has agreed to grant a lease of the first floor of the premises to Anthony Cacas to enable him to establish his legal practice. He has already spent $10,000 on repairing the dilapidated first level.
The defendant, as registered proprietor, is entitled to the use of the first floor until a Court determines otherwise. It may take considerable time to determine that issue. Until then it should not be prevented from obtaining some income by way of rental from those premises for that period of time.
So far as Mr Cacas personally is concerned, he asserts in his affidavit sworn on 24 June 2016, that he resigned his employment from a legal firm on 3 June 2016, well before any of the fresh assertions were raised for the first time by the plaintiff.
The sums spent by Mr Cacas in renovations has benefited the premises, and its ultimate owner. The premises had been run down, dilapidated and not occupied since 2014. They are now improved. He has registered his business name, and has an Australian Business Number. He has given notice to clients that the practice is to commence at these premises on 1 July 2016.
It is plain that he will suffer significant losses if those premises were not made available to him. He is committed to the premises. It is not to the point to say, as the plaintiff says, that he should go somewhere else. He is the ideal tenant at the premises, able to give undertakings to the court which would not prejudice the title of the plaintiff in the event that she succeeded in due course.
Although it is unlikely that he would sue the defendant, the fact remains that the defendant would potentially be liable to Mr Cacas in the event that it was unable to comply with its agreement with him to lease the premises.
While the plaintiff has established that there is a serious issue to be tried, the balance of convenience is overwhelmingly in favour of injunctive relief being refused. The premises are ready, and available to be used by Mr Cacas. Work has been done which has improved the premises. The business is not one which will cause noise or other damage to the property, nor to the business of the plaintiff.
Conclusion
In my opinion, subject to certain undertakings being given to ensure that Anthony Michael Cacas does not register any lease over the premises on the title; and he concedes that he has no right to claim a five year lease pursuant to the Retail and Commercial Leases Act, then in those circumstances no injunction should be granted.
It leaves one further matter which was raised by Mr Dal Cin for the plaintiff and that was that the moneys which are paid by way of rent should be paid into a trust account.
I repeat that the defendant is presently the registered proprietor, and has been for many years. It has expended money on the premises.
In my opinion it should be able to receive the rent unless and until the position changes upon a court order in the future. That rent will be documented. The plaintiff will easily be able to easily establish what rental has been obtained in relation to the premises.
There is no suggestion that any damages awarded to the plaintiff in the future, would not be recoverable from the defendant. Accordingly I do not make the order for payment sought by the plaintiff.
Counsel for the defendant has now intimated that he has instructions from both Mr Cacas and the defendant that he, Mr Cacas, will remain on the premises simply as a monthly tenant and that will continue until trial. He undertakes not to register his interest on the title.
He also undertakes that he will not claim a five-year lease in those circumstances. These arrangements will continue until the trial of the within action.
Orders
1.I direct that the appropriate undertakings by Anthony Cacas be placed in writing and filed by no later than 12 noon on Monday, 27 June 2016.
2.I dismiss the plaintiff’s application for an injunction for these reasons.
3.I reserve the costs of the application to the Trial Judge.
4.I direct that the action be referred to a Master so that the questions of joinder of parties, and the pleadings be considered urgently.