Henningsen v Nolan - [2004] SASC 105

HENNINGSEN v NOLAN
[2004] SASC 105
Magistrates Appeal

GRAY J This is an appeal from a decision of a magistrate following a trial.
Background
Barry Henningsen and Brett Colin Henningsen, the plaintiffs and appellants, were the registered proprietors of commercial premises at 25 High Street, Strathalbyn. James Gerald Nolan, the defendant and respondent, was a tenant occupying the premises. Mr Nolan operated an antique business from the premises.
Mr Nolan entered possession of the premises on 23 June 1999 pursuant to the terms of a deed of assignment of a lease that commenced on 1 December 1995 and terminated after five years on 30 November 2000.
The primary issue before the magistrate was whether Mr Nolan was entitled to a lease of the premises for a term of five years commencing from 1 December 2000. The magistrate concluded that Mr Nolan was entitled to a lease for that term. Barry and Brett Henningsen have appealed from that decision.
At trial all relevant facts were agreed. The parties respective contentions centred on the construction of the lease, a deed of assignment by a former lessee to Mr Nolan and the terms of the Retail and Commercial Leases Act1995 (SA).
The agreed facts can be summarised as follows:
-On 1 December 1995 a lease of the premises was entered into for a term of five years. The lease was to expire on 30 November 2000.
-On 23 June 1999 the then tenant by deed of assignment assigned the lessees interest in the 1995 lease to Mr Nolan. As a result Mr Nolan became the lessee of the premises.
-The term of the 1995 lease expired on 30 November 2000.
-On the expiration of the term of the 1995 lease Mr Nolan remained in occupation of the premises with the consent of the lessor thereby holding over.
-On 14 February 2003 the then owners entered into an agreement for the sale and purchase of the premises to Barry and Brett Henningsen. The agreement for sale and purchase recorded the existence of the lease with the following notation:
Tenancies:James Gerald Nolan as tenant of the whole of the land … having accepted an assignment of a previous lease which expired on the 30^th November 2000 and since then occupying the property on a ‘holding over’ basis.
The contract for sale was settled on 11 March 2003. Barry and Brett Henningsen then became the registered proprietors of the premises.
-On 12 March 2003 Barry and Brett Henningsen as owners and lessor caused a notice of termination to be served on Mr Nolan. That notice was in the following terms:
That you occupy the Premises pursuant to a Memorandum of Lease dated 20 December 1995 between certain parties and assigned to you pursuant to a Deed of Assignment dated 23 June 1999 (“the Lease”).
The term of the Lease expired on 1 December 2000.
That pursuant to clause 3.2 of the Lease you occupy the premises under a monthly periodic tenancy (“the Tenancy”).
That…

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.

Continue reading Henningsen v Nolan

Details

AGLC: Henningsen v Nolan [2004] SASC 105
Case: [2004] SASC 105
Decision Date: 14 April 2004

CaseChat Overview and Summary

Barry and Brett Henningsen brought proceedings against Mr Nolan, who had occupied premises as a tenant. The Henningsens argued that Mr Nolan had been in occupation as a lessee since 1995 and as a tenant since 30 November 2000. They contended that Mr Nolan was a monthly tenant and that a notice of termination of tenancy served on him on 12 March 2003 was valid. Mr Nolan, on the other hand, argued that he was entitled to a five-year lease commencing from the date of expiration of the original lease. The dispute came before the Magistrate who had to determine whether Mr Nolan was entitled to a five-year lease or if he was merely a monthly tenant.
The court considered the definition of ‘Lessee’ in the lease agreement and concluded that the term referred to the party or parties described on page 1 of the lease as the Lessee, which in this case were the Spilsburys. The court found that Mr Nolan was not the Spilsburys or their assignee and that there was no fresh lease between the plaintiffs and Mr Nolan. The court further held that Mr Nolan was not a monthly tenant but rather held the premises as a tenant on a monthly basis after the expiration of the original lease. The court determined that Mr Nolan was entitled to a five-year lease commencing from 30 November 2000, the date of expiration of the original lease. The court ordered that the Henningsens be restrained from issuing or acting upon the notice of termination until 1 December 2005.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

GRAY J

Barry and Brett Henningsen rejected this claim. It was their case that Mr Nolan had been in occupation of the premises as lessee since 1995 and personally since 23 June 1999. He had been in occupation since 1 December 2000 pursuant to a holding over of the 1995 lease. It was said that Mr Nolan was a monthly tenant. It was contended that section 20B of the Retail and Commercial Leases Act had no application. Consequently the notice of termination of 12 March 2003 was valid.The Magistrate’s Conclusions On 31 July 2003 the magistrate entered judgment for Mr Nolan and ordered that Barry and Brett Henningsen be restrained from issuing or acting upon the notice of termination until 1 December 2005. The magistrate concluded:… I am of the view that Nolan is the person who has the right to occupy the retail shop under a retail shop lease and that he has not done so for at least five years. I do not consider that reference in the definition of ‘Lessee’ to a former lessee (who may be the assignor of the lease to Nolan in this matter) is of any assistance. The definition is inclusive but the primary definition as to its meaning in my view precisely fulfils the description of Nolan. In other words, I am not required and do not think that I am required to add together the period of occupation of the former lessee and Nolan’s time of occupation to come to a period of time which would exceed five years. I believe that in the present case the period of occupation of Nolan (ie since 23 June 1999 until the present day) is the period that I am required to consider and it is that period alone. Nolan assumed occupation of the premises nearly 18 months before the lease expired on 30 November 2000. He has held over since 30 November 2000. There is no fresh lease between the plaintiffs and Nolan.…I find that Nolan is entitled to consider that he has a retail shop lease for a period of five years operating from the date of expiry of the original lease and therefore he is entitled to a five year lease operative from 1 December 2000 until 30 November 2005. The magistrate concluded that Mr Nolan was entitled to a five year retail lease commencing from 30 November 2000, the date of expiration of the first lease.The Lease Merrawyn Lorna Harvey, John Ralph Rowe, Wendy Joy Garwood, Neville David Rowe and Susan Rosslyn Alexander, the then owners of the premises entered into a lease with Bruce Gilbert Spilsbury and Amanda Jan Spilsbury for a period of five years from 1 December 1995. The lease defined ‘lessee’:The “Lessee” means the party or parties described on page 1 of this lease as the Lessee and if more than one then jointly and severally and includes heirs, executors, administrators, successors and permitted assigns.The parties described on page 1 as the lessee were the Spilsbury’s. The lease further provided:3.1 The Term commences at 12.01 am on the first day [1/12/95] and ends at 12.00 pm on the last day [30/11/00] of the Term…3.2If the Lessee with the consent of the Lessor express or implied remains in occupation of the Leased premises after the expiration of the Term then the Lessee shall be deemed to hold the Leased Premises as a tenant on a monthly basis subject to all the covenants and conditions herein contained and the tenancy may be terminated by either party giving to the other not less than one (1) calendar months’ prior notice in writing expiring on a day necessarily at the end of a normal monthly period provided that the Lessee may hold over for a maximum period of six months only following the expiration of the Term.The Deed of Assignment

Ratio Decidendi

Legal Principle Established

Established by: GRAY J

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