Commonwealth of Australia (as represented by the Department of Infrastructure and Regional Development) v Carr

[2015] FCCA 3383

FEDERAL CIRCUIT COURT OF AUSTRALIA

COMMONWEALTH OF AUSTRALIA (AS REPRESENTED BY THE DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENT) v CARR [2015] FCCA 3383

Catchwords:
ADMINISTRATIVE LAW – Commonwealth tenancy dispute – licence – contractual licence terminable at will.

Legislation:

Federal Circuit Court of Australia Act 1999 (Cth)
Residential Tenancies Act 2010 (NSW), s.3

Commonwealth of Australia (As Represented by the Department of Infrastructure and Regional Development)v Carr [2015] FCA 3382
Commonwealth of Australia (As Represented by the Department of Infrastructure and Regional Development) v Hevers & Anor [2015] FCCA 1814
Cowell v Rosehill Racecourse (1937) 56 CLR 605
Dockrill v Cavanagh (1944) 45 SR (NSW) 78

Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd [1997] AC 749 Trump International Golf Club Scotland Limited v The Scottish Ministers [2015] UKSC 74

Applicant: COMMONWEALTH OF AUSTRALIA (AS REPRESENTED BY THE DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENT)

Respondent: WILLIAM CARR

File Number: SYG 2608 of 2015

Judgment of: Judge Smith

Hearing dates: 18 & 19 November 2015

Date of Last Submission: 14 December 2015

Delivered at: Sydney

Delivered on: 21 December 2015

REPRESENTATION

Counsel for the Applicant: Mr J. Doyle, Mr D.W. Rayment
& Ms A. Mitchelmore

Solicitors for the Applicant: Australian Government Solicitor

Counsel for the Respondent: Mr P. King

DECLARATION

1. The licence granted by the agreement between the applicant and the respondent with respect to the land situated at 490 Badgerys Creek Road (previously known as Lot 27 in section D of former DP 1451) Badgerys Creek NSW 2555, comprising part of folio identifier 1/838361 (“the Land”) has been terminated.

ORDERS

1. The respondent vacate, and remove all goods and stock from the Land forthwith.

2. The applicant be authorised to dispose of any goods that are not removed from the Land within 14 days of judgment.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 2608 of 2015

COMMONWEALTH OF AUSTRALIA (AS REPRESENTED BY THE DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENT)

Applicant

And

WILLIAM CARR

Respondent

REASONS FOR JUDGMENT

1. Mr Carr has occupied the land situated at Lot 1 Badgerys Creek Road (also known as 15 Fuller Street), Badgerys Creek NSW 2555 (“Premises”) since April 2000 as a tenant of the Commonwealth. Mr Carr is also the licensee of the land situated next to the Premises being the land at 490 Badgerys Creek Road, Badgerys Creek (“the Land”). The Premises and vacant land are part of a larger area of land which the Commonwealth proposes to develop for the purposes of an airport.

2. In 2005, at a time when Mr Carr was already occupying the Premises, the person renting the Land vacated. Mr Carr subsequently approached the property manager for the Commonwealth and asked to lease the Land. On 15 April 2005 the parties signed a licence agreement pursuant to which Mr Carr was given a licence to use the Land for the purpose of grazing no more than 20 adult horses (“Licence”).

3. On 11 December 2014 the Commonwealth gave Mr Carr a notice terminating the Licence with effect from 22 June 2015. Mr Carr did not vacate the Land by that date and the Commonwealth commenced these proceedings seeking a declaration that the Licence has been terminated and orders for vacant possession.

4. The Commonwealth has also brought proceedings against Mr Carr in respect of the Premises. Those proceedings were heard concurrently with this matter and I have delivered judgment in them at the same time as in this matter: Commonwealth of Australia (As Represented by the Department of Infrastructure and Regional Development)v Carr [2015] FCA 3382. In those proceedings, I found that the residential tenancy agreement between Mr Carr and the Commonwealth in respect of the Premises was governed by the Residential Tenancies Act 2010 (NSW) (“Tenancies Act”). That was because the Premises were “residential premises” within the meaning of that Act and the use of the Premises was not predominantly for the purposes of business or agriculture.

5. The Land, however, is not governed by the Tenancies Act. It is not “premises or part of premises (including any land occupied with the premises) used or intended to be used as a residence” and so is not “residential premises”: see Tenancies Act s.3. The Land is, in contrast to the Premises, vacant land, that is, without any improvements other than fencing, and its sole use appears to be for the keeping of horses and, possibly, the storing of disused motor vehicles kept for spare parts. For those reasons, the rights between the parties to the Licence, including the way in which those rights are terminated, are to be determined by reference to its terms.

6. There is no question that this is a matter involving a licence or other arrangement to possess, occupy or use land and a dispute about the termination of the licence or other arrangement in which the Commonwealth is a party. For that reason, it is a Commonwealth tenancy dispute within the meaning of the Federal Circuit Court of Australia Act 1999 (Cth) and this Court has jurisdiction to determine it: see Commonwealth of Australia (As Represented by the Department of Infrastructure and Regional Development) v Hevers & Anor [2015] FCCA 1814.

7. An important term of the Licence was that the rights of Mr Carr in respect of the Land did not include exclusive possession. Clauses 9 and 10 provided:

   9.This licence shall in no way exclude the Commonwealth from the land and nothing herein contained shall amount to or be construed as a demise or an agreement to demise or to be deemed to create any lease or tenancy in favour of the licensees [sic] and shall not give the licensee any right of exclusive possession of the land.

   10.Without limiting the generality of clause 9, the licensee acknowledges that it has no right to prevent the Commonwealth or any person authorized by the Commonwealth from accessing the Land and making use of the Land.

   (Emphasis added)

8. These clauses establish that there was no intention to create a tenancy. Mr Carr did not argue otherwise.

9. The period of the Licence was 37 weeks and 1 day commencing on 15 April 2005 and terminating on 31 December 2005. There was no holding over clause. For that reason, even though there were clauses allowing termination on 6 months’ notice (cls.27 and 29), the rights of the parties under the Licence ceased on 31 December 2005. However, according to Mr Carr’s evidence, he continued to use the Land and to pay the licence fee (although he referred to it in evidence as rent) on the same basis. That fee was paid on a monthly basis. The evidence of Gayanki Samarasinghe for the Commonwealth was that, as at 21 September 2015, the licence fee had not been paid in the first quarter of this financial year. That evidence was not contested; however the Commonwealth has not sought an order for the payment of any outstanding amounts.

10. Mr Carr argues that he continued to use the Land as part of the Premises which were subject to the residential tenancy agreement and so a tenancy arose. I reject that argument. The two properties were not contiguous, the Land is not referred to in the residential tenancy agreement and had been, and the two properties continued to be treated and used differently to each other. There is nothing in the evidence to suggest that there was any intention on the part of the Commonwealth to grant Mr Carr any greater right in respect of the Land than had been given under the Licence.

11. In those circumstances, there are two possibilities: first, that Mr Carr was trespassing on the Land from the date of expiry of the Licence; and secondly, that there was an implied contractual licence. In circumstances where Mr Carr continued to pay the Commonwealth for permission to enter the Land and use it for the purposes of grazing horses, I conclude that there was a contractual licence. As such, the Licence was terminable at will: Cowell v Rosehill Racecourse (1937) 56 CLR 605, 615 (Latham CJ), 627 (Starke J), 630 (Dixon J).

12. On 11 December 2014 an agent of the Commonwealth handed Mr Carr a document entitled “Notice of Termination of Licence”. That notice referred to the Land and the Licence, noting that the “original fixed term” of the Licence had expired. It then stated:

    Notice

    The Commonwealth hereby gives you notice for the purposes of the Licence (including in accordance with clause 27) terminating the Licence with effect on and from 22 June 2015 (the Termination Date) and hereby notifies You that You are required to give vacant possession of the Property to the Commonwealth by the Termination Date.

    (Emphasis in original)

13. In accordance with the modern harmonisation of the approach taken to the construction of texts, the meaning of this notice must be gleaned objectively in its context: Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd [1997] AC 749 at 770-771 (Lord Steyn) and 779–780 (Lord Hoffmann); Trump International Golf Club Scotland Limited v The Scottish Ministers [2015] UKSC 74 at [33] (Lord Hodge with whom Lord Neuberger, Lord Mance, Lord Reed, and Lord Carnwath agreed). That approach will overlook any obvious errors to arrive at what a sensible person, in the circumstances, would understand by the words. Taking that approach, in my view, although the notice refers to the Licence, it is sufficiently clear to constitute a notice to quit that served to terminate the licence with effect from 22 June 2015. It may also be noted that, unlike a notice to quit in respect of a periodic tenancy, there is no requirement that a notice to quit in respect of a licence must specify the end of any particular period in order to be effective: cf. Dockrill v Cavanagh (1944) 45 SR (NSW) 78 at 82. Accordingly, Mr Carr has been trespassing on the Land since 22 June 2015.

14. It follows that Mr Carr must immediately give vacant possession of the Land to the Commonwealth.

Conclusion

1. I therefore make the following declaration and orders:

   (1)A declaration that the licence granted by the agreement between the applicant and the respondent with respect to the land situated at 490 Badgerys Creek Road (previously known as Lot 27 in section D of former DP 1451) Badgerys Creek NSW 2555, comprising part of folio identifier 1/838361 (“the Land”) has been terminated.

   (2)The respondent vacate, and remove all goods and stock from the Land forthwith.

   (3)The applicant be authorised to dispose of any goods that are not removed from the Land within 14 days of judgment.

I certify that the preceding fifteen (15) paragraphs are a true copy of the reasons for judgment of Judge Smith

Associate: 

Date: 21 December 2015