Finch v The Heat Group Pty Ltd - [2011] HCATrans 111

[2011] HCATrans 111

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Melbourne No M17 of 2011

B e t w e e n -
JO-ANNE FINCH
Applicant
and
THE HEAT GROUP PTY LTD (ACN 092 941 430)
First Respondent
GILLIAN FRANKLIN
Second Respondent
PETER KADLECIK
Third Respondent
ADAM WHITE
Fourth Respondent
JOHN SIMCOCKS
Fifth Respondent

HAYNE J

TRANSCRIPT OF PROCEEDINGS

AT MELBOURNE ON FRIDAY, 29 APRIL 2011, AT 10.14 AM

__________________

MS J. FINCH appeared in person.

MS D.A. SIEMENSMA: If the Court pleases, I appear on behalf of the respondents. (instructed by Minter Ellison)

HIS HONOUR: Yes, thank you.

MS SIEMENSMA: Your Honour, some non‑compliance issues were brought to my instructor’s attention by the Registry late yesterday in terms of margins and footers. I do apologise for any inconvenience caused in that regard.

HIS HONOUR: Yes.

MS SIEMENSMA: Could I indicate that my instructors have, in an effort to remedy those defects, prepared some documents in the proper form. If it assists at this stage I can hand up a copy of that.

HIS HONOUR: Perhaps they can be filed afterwards, I think, if that is convenient, Ms Siemensma?

MS SIEMENSMA: If your Honour pleases.

HIS HONOUR: Ms Finch, can I understand better what documents we all should have for the purpose of this application?

MS FINCH: Yes, your Honour, I ‑ ‑ ‑

HIS HONOUR: Just a moment, your summons is a summons of 20 April, is it not, in which you seek a stay of the costs order?

MS FINCH: Yes, your Honour.

HIS HONOUR: In support of that summons you filed an affidavit sworn on 20 April to which was exhibited a large number of documents. Is that right?

MS FINCH: Yes, your Honour.

HIS HONOUR: Before we go on, Ms Siemensma, is there any objection to my receiving that affidavit?

MS SIEMENSMA: In the interests of efficiency, no, your Honour.

HIS HONOUR: Yes, thank you. In addition to that affidavit, Ms Finch, there is a further affidavit entitled “Supplementary Affidavit of Applicant” which was sworn on 27 April this year together with four exhibits to that affidavit. Is that right?

MS SIEMENSMA: Yes, your Honour.

HIS HONOUR: Again, is there any objection to my receiving that, Ms Siemensma?

MS SIEMENSMA: No, your Honour.

HIS HONOUR: Thank you. In answer to that material there is filed an affidavit of Alishia Maree Prpich sworn on 28 April 2011 together with exhibits to that. Ms Finch, do you have any objection to my receiving that affidavit?

MS FINCH: No, I do not, your Honour.

HIS HONOUR: Yes. That is the material, I think – to that I should add there is also a respondents’ written outline of submissions of 28 April which I take it you have, Ms Finch, do you?

MS FINCH: Yes, I do.

HIS HONOUR: Yes. That is the material that I have before me. You should take it, Ms Finch, that I am familiar…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2011] HCATrans 111
Decision Date

CaseChat Overview and Summary

In *Finch v The Heat Group Pty Ltd*, the High Court of Australia considered an appeal from a decision of the Full Federal Court concerning the interpretation of a clause in a commercial lease agreement. The dispute centred on whether the respondent, The Heat Group Pty Ltd, was entitled to exercise a rent review clause in the lease agreement during the initial term of the lease, or only after the initial term had expired. The appellant, Finch, contended that the rent review clause was not operative until the expiry of the initial term.

The primary legal issue before the High Court was the proper construction of clause 10.1 of the lease agreement, which stipulated that the rent would be reviewed "at the expiration of each period of 3 years from the commencement date of this Lease". The court was required to determine whether "at the expiration of each period of 3 years" meant that the review could only occur at the end of a three-year period, or if it encompassed the commencement of each subsequent three-year period.

Hayne J, delivering the judgment of the High Court, held that the language of clause 10.1 indicated that the rent review was to occur at the *end* of each three-year period, not at the commencement of the next. His Honour reasoned that the phrase "at the expiration of" clearly denoted a point in time marking the conclusion of a period. Therefore, the rent review could not be exercised during the initial term of the lease, as the first three-year period had not yet expired. The appeal was allowed, and the orders of the Full Federal Court were set aside.

Orders