Legune Land Pty Ltd v Northern Territory Land Corporation and Northern Territory of Australia

Legune Land Pty Ltd sued the Northern Territory Land Corporation and the Northern Territory of Australia over the assessment of mesne profits and the removal of a caveat on a parcel of land. The dispute arose from the plaintiff's occupation of the land and the defendants' desire to lease the land to a third party. The case was heard in the Federal Court of Australia. The primary legal issues were whether the value of the mesne profits should be based on a one-year lease or a five-year lease with an option, and whether the caveat should be removed due to its excessive scope and lack of a serious question to be tried.

The court found that the proper approach to assessing mesne profits was the compensatory approach, which sought to compensate the plaintiff for the benefit received by the defendants from the occupation of the land. The court rejected the defendants' argument that the value of the profits should be based on the lost opportunity for leasing the land for five years with an option, as this approach did not consider the actual occupation of the land by the plaintiff. Instead, the court adopted the plaintiff's approach, which was based on the value of a one-year lease. However, the court found that the plaintiff's valuation was too low and increased the value to reflect the full commercial market rent for the premises. The court also found that the caveat was too wide and did not meet the requirements for an interlocutory injunction. The first defendant offered an undertaking to give 10 days notice of adverse dealings, which the court found to be sufficient to balance the convenience in favour of removing the caveat.

The court ordered that the mesne profits be assessed based on the value of a five-year lease with an option, but reduced to reflect the plaintiff's actual occupation of the land for 2¾ years. The court also ordered that the caveat be removed, subject to the first defendant's undertaking to give notice of adverse dealings. The court further ordered that the defendants pay the plaintiff's costs of the application to remove the caveat.