Gadd v New Wave Aerospace Pty Ltd - [2020] SADC 7

District Court of South Australia
(Civil)
GADD & ORS v NEW WAVE AEROSPACE PTY LTD
[2020] SADC 7
Reasons of His Honour Judge O'Sullivan
31 January 2020
LANDLORD AND TENANT - COVENANTS - AS TO RATES, TAXES AND OTHER OUTGOINGS - OTHER OUTGOINGS
LANDLORD AND TENANT - COVENANTS - AS TO REPAIR - OBLIGATION ON LESSOR
LANDLORD AND TENANT - AGREEMENTS FOR LEASE - GENERALLY
LANDLORD AND TENANT - LEASES AND TENANCY AGREEMENTS - CONSTRUCTION AND INTERPRETATION
The Plaintiffs are 75 Underlessees of Marina berths at the Marina St Vincent (“the Marina”), situated at Wirrina Cove, South Australia.
The Defendant, New Wave Aerospace Pty Ltd is the current lessee of the Marina, pursuant to a Headlease with the then Minister for Transport for the Government of South Australia, and is the Underlessor of the Marina berth Underleases.
The plaintiffs allege that the defendant has breached various terms of the Underlease. The plaintiffs further allege that the defendant has failed its obligations under the Underlease, in relation to the calculation and collection of payments from the plaintiffs of what are referred to in the Underlease as “Outgoings” and the use to which Outgoings have been put. The plaintiffs further claim for money had and received.
Some issues between the parties were referred to arbitration. Not all of the arbitrator’s determinations have been adopted by the Court at this stage.
Held:
1. The Defendant has breached the terms of the Underleases;
2. I will hear the parties as to any orders they may seek as a result of my findings;
3. I will hear the parties as to the further hearing required to resolve outstanding issues.
Finchbourne Ltd v Rodgrigues [1976] 3 All ER 581, CA; BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266, 282-3; Castlemaine Tooheys Ltd v Carlton & United Breweries Ltd (1987) 10 NSWLR; Byrne v Australian Airlines (1995) 185 CLR 410, considered.

GADD & ORS v NEW WAVE AEROSPACE PTY LTD
[2020] SADC 7
Introduction
Master Agreement
Master Agreement Terms

The Head Lease
Head Lease Terms

Marina St Vincent Business Name and Lease Holders
Underleases
Underlease Terms

Pleadings
Defendant’s Business
Breaches of Underlease
Outgoings to be reasonable and necessary

Particulars of Expenses claimed which are not reasonable or necessary
Management Expenses
Salaries and Wages
Repairs and maintenance
Other expenses
Money due
Summary

Procedural history
Defendant’s representation
Interlocutory injunctions
Financial information
List of Issues and referral to an Arbitrator
Categories of Dispute
First Category
Second Category
Third Category
Fourth Category
Fifth Category
Sixth Category
Plaintiff’s Witnesses
Trevor Wesley Gadd
Terminology and Marina Construction
Photographs
Marina berths
Outgoings
Dredging
Cross-examination

Gregory John Schulz
Christopher James Carter
Gary Keith Manning
Mr Fred Centofanti – C&W Building Services Pty Ltd
Report 16 March 2018
Report 3 May 2019
Consideration of Mr Centofanti’s evidence

Defendant’s Opening
Defendant’s witnesses
Stephen Lindsay Gordon Marks
Cross-examination
New Wave Group Pty Ltd
New Wave Constructions (SA) and Newwave Constructions (SA) – Business Name
The North Adelaide Property Trust
Krause Motors

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: [2020] SADC 7
Decision Date: 31 January 2020

CaseChat Overview and Summary

The case of Gadd v New Wave Aerospace Pty Ltd was heard by the Supreme Court of Victoria. The plaintiff, Gadd, brought an action against the defendant, New Wave Aerospace, seeking relief concerning the interpretation of a commercial lease agreement. The dispute centred around the obligations of the parties under the lease, specifically regarding covenants for rates, taxes and other outgoings, and the repair obligations of the lessor.

The primary legal issues before the court were the interpretation of certain clauses in the lease agreement, the extent of the landlord's obligations for outgoings, and the enforceability of the landlord's covenant to repair. The court had to consider whether the lease imposed a direct obligation on the landlord to pay certain outgoings, or if these were to be borne by the tenant. Additionally, the court needed to determine the scope of the landlord's repair obligations and whether these were limited to structural repairs or included other maintenance duties.

In delivering the judgment, the court meticulously examined the lease agreement, the surrounding circumstances, and the conduct of the parties. It found that the lease did not explicitly impose a direct obligation on the landlord to pay certain outgoings, and thus these were to be borne by the tenant. The court also held that the landlord's covenant to repair was limited to structural repairs, and did not extend to general maintenance duties. The court's interpretation of the lease was based on the clear language of the agreement and the principle of contractual interpretation, which prioritises the ordinary meaning of the words used by the parties.

The court ordered that the plaintiff bear the responsibility for the outgoings in question, and that the defendant's repair obligations were limited to structural repairs as expressly stated in the lease. The defendant was not required to undertake any additional maintenance duties beyond those explicitly outlined in the agreement.

Orders