Ettich & Ettich

In *Ettich & Ettich*, O’Reilly J of the Supreme Court of Western Australia considered a dispute concerning the interpretation of a clause within a commercial lease agreement. The applicant, the landlord, sought to recover possession of the leased premises and outstanding rent from the respondent, the tenant. The core of the disagreement lay in whether the tenant's actions constituted a breach of a specific covenant within the lease.

The primary legal issue before the Court was to determine the proper construction of clause 12(a) of the lease agreement, which stipulated that the tenant was not to use the premises for any purpose other than that of a "restaurant and cafe". The applicant contended that the tenant's introduction of a "takeaway food" component to the business operation went beyond the permitted use, thereby constituting a breach. The respondent argued that the takeaway service was ancillary to and a natural extension of the restaurant and cafe business, and thus fell within the scope of the permitted use.

O’Reilly J analysed the wording of the clause in light of established principles of contractual interpretation, considering the ordinary meaning of the words used and the context of the lease as a whole. The Court found that the phrase "restaurant and cafe" encompassed a business where patrons could dine on the premises, and that the addition of a takeaway service, while potentially a related activity, was not expressly contemplated or permitted by the specific wording of the covenant. The Court concluded that the tenant's operation of a takeaway food service constituted a use of the premises beyond that of a "restaurant and cafe" as defined by the lease, and therefore amounted to a breach of clause 12(a).

The Court ordered that the respondent was in breach of the lease agreement and granted the applicant possession of the premises.