FAI General Insurance Company Ltd. v Parras

FAI General Insurance Company Ltd. (the appellant) appealed to the Court of Appeal of New South Wales against a decision of the primary judge concerning an option to renew a lease. The dispute centred on whether a notice exercising this option had been validly given by the tenant (the respondent) to the landlord (the appellant).

The central legal issue before the Court of Appeal was whether the tenant's posting of a notice exercising the option to renew the lease constituted effective service, and whether strict compliance with the lease's clause regarding service was a prerequisite for the valid exercise of that option.

The Court of Appeal considered the terms of the lease agreement and the common law principles governing the service of notices. It was held that while the lease stipulated a particular method of service, the tenant's act of posting the notice, in the absence of evidence to the contrary, was sufficient to establish that the notice had been given. The Court reasoned that the purpose of the service clause was to ensure the landlord received notice, and posting, in this instance, achieved that objective. The appeal was allowed in part, primarily concerning the costs order made by the primary judge, which was set aside and replaced with an order that the respondents pay the appellant's costs of the proceedings. The appeal was otherwise dismissed, with the respondents ordered to pay the appellant's costs of the appeal.