Lugarno Petroleum Pty Limited v Gabriel Shimess
[2008] NSWSC 983
•26 August 2008
CITATION: Lugarno Petroleum Pty Limited v Gabriel Shimess [2008] NSWSC 983 HEARING DATE(S): 25 August 2008, 26 August 2008 JUDGMENT OF: McDougall J at 1 EX TEMPORE JUDGMENT DATE: 26 August 2008 DECISION: See paragraph [76] of the judgment. CATCHWORDS: EQUITY - rectification - whether mistaken belief as to terms of written lease - whether inconsistent with alleged prior oral agreement - rectification - rescission. CASES CITED: Australasian Performing Right Association Limited v Austarama Television Pty Ltd [1972] 2 NSWLR 467
Hooker Town Developments Pty Ltd v The Director of War Service Homes (1973) 47 ALJR 320PARTIES: Lugarno Petroleum Pty Limited (Plaintiff)
Gabriel Shimess (First Defendant)
Samir Shimess (Second Defendant)FILE NUMBER(S): SC 50078/07 COUNSEL: A G Rogers (Plaintiff)
C W Robinson (Defendant)SOLICITORS: Kheir & Associates (Plaintiff)
James Lahood & Associates (Defendant)
IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
COMMERCIAL LIST
McDOUGALL J
26 August 2008 ex tempore (revised 28 August 2008)
50078/07 LUGARNO PETROLEUM PTY LIMITED v GABRIEL SHIMESS
JUDGMENT
1 HIS HONOUR: The plaintiff is the proprietor of land and improvements at Lugarno. The improvements are, or include, a service station and a mechanical workshop. The workshop is and for many years has been used by the defendants for carrying on their business known as GSS Mechanical Services. There is a lease of the workshop from the plaintiff to the defendants. It commenced on 1 September 2006. The initial term is three years, but there are three options for further three year terms.
2 The rent reserved by the lease is $1,000 per month, or $12,000 per annum. In addition, the defendants are to pay 40 percent of certain outgoings. The rent is subject to review in accordance with movements in the Consumer Price Index.
3 The plaintiff's case is that the reference to a rent of $12,000 per annum is mistaken. The plaintiff says that the true rent was agreed at $1,000 per week, or $52,000 per annum, again with outgoings and subject to adjustment. (I should note that all the figures that I am quoting are exclusive of GST.) Alternatively, the plaintiff says, it executed the lease on the basis of a mistake as to the rental stated in it. It says that the defendants unconscientiously took advantage of this mistake.
4 On one basis, the plaintiff seeks rectification of the lease. On the other, it seeks rescission. In each case, there are prayers for ancillary relief.
The Real Issues
5 The parties agreed that the real issues for decision were as follows:
1. Whether the Plaintiff agreed upon a rent of $1000 per week in about February 2006 in relation to the subject premises.
2. Whether the lease executed in about September 2006 properly reflected the agreement between the parties as to rent.
3. Whether the Defendants were aware that the Plaintiff mistakenly believed that the lease of the service station provided for a rent other than a rent of $12,000 per annum (as provided in the lease document).
4. If the answer to 3 is in the affirmative, whether the Defendants took unconscientious advantage of that mistake.
5. Whether the Plaintiff is entitled to:
(i) Rectification of the lease;
(ii) Recision of the lease;
(iii) An adjustment of rent for the period 1 September 2006 to the present.
Background
6 The defendants first went into occupation of the workshop pursuant to a sublease commencing on 1 September 1997. That sublease was for a term of three years, with two options for further three year terms. It would appear that the defendants exercised their options. Accordingly, they had security of tenure until 31 August 2006.
7 The rent reserved by the sublease was $600 per week. Although there was provision for adjustments in the rent, according to movements in the Consumer Price Index, it appears to be the case that the rent was never in fact increased. Thus, at the time of the negotiations between the plaintiff and the defendants, and at all times up until 1 September 2006, the defendants were paying $600 per week.
8 Under this sublease, the defendants were not liable for any proportions of outgoings. Nor, it appears, did they pay anything on account of GST. I forebear from commenting whether there was any liability for GST.
9 The plaintiff acquired the property by contracts exchanged in April 2005, settled some time thereafter. Mr Ahmed Skaf, a director of the plaintiff, appears to have been the person with the principal responsibility for dealing with the defendants in relation to the workshop. For convenience, I shall refer to him simply as Mr Skaf, and where it is necessary to distinguish him from his brother, who was a director and secretary of the plaintiff, I shall refer to the brother as Mr Hassan Skaf.
10 Of the defendants, it was the first defendant, Mr Gabriel Shimess, who had principal responsibility for dealing with Mr Skaf. For convenience, I shall refer to him simply as Mr Shimess. Again, to the extent that it is necessary to refer to the second defendant, I shall refer to him as Mr Samir Shimess.
Negotiations for a new lease
11 After the plaintiff became the proprietor of the property, Mr Skaf introduced himself to Mr Shimess. They made arrangements for the defendants to pay the weekly rent direct to the plaintiff. Usually, rent was payable, and paid, on the Monday of every week. There were exceptions, for example, when that day was a public holiday.
12 The plaintiff leased out the service station portion of the property to another entity. At some time in late 2005 or early 2006, the plaintiff entertained negotiations from another party in relation to the service station business. A representative of that other party visited the property. This turned the minds of the defendants to the need, later in 2006, to renew their lease.
13 Accordingly, as is common ground, there were conversations between Mr Shimess and Mr Skaf. The first of those conversations appears to have been by telephone, at some time in January 2006. Mr Shimess noted that the lease would terminate on 31 August 2006, and inquired whether it could be renewed. Mr Skaf says that he told Mr Shimess that the plaintiff would be prepared to renew the lease, but at a different rent. That is in dispute.
14 In any event, there was a further discussion, this time in person, between Mr Skaf and Mr Shimess. That discussion took place at another business owned by the Skaf brothers, or an entity associated with them. There was discussion of the lease that would be made available. Mr Shimess said that he would like "3 by 3 by 3" and that Mr Skaf agreed to this. On either view of the conversation, the only discussion of rent at that meeting was Mr Skaf's refusal, or inability, to nominate what rent would be required.
15 There was then a second meeting between Mr Skaf and Mr Shimess. It too took place at Mr Skaf's other business premises. Mr Skaf says that he that stated that he wanted a rent of $1,000 plus GST. Mr Shimess, according to Mr Skaf, asked if Mr Skaf could do better but Mr Skaf said that someone else had offered him $1,000 a week plus GST and accordingly he was not prepared to deal.
16 Mr Shimess says that no amount of rent was mentioned at this meeting. He says that Mr Skaf said that the defendants were good tenants and he was happy for them to stay, but that he (Mr Skaf) did not know whether any terms of the lease would be changed.
17 An employee of the Skaf brothers' business, Mr Fawez Maskaleh, says that he was present when each of the meetings took place. He was not a participant in the meeting, but was working nearby, and, he says, able to hear what was being discussed.
18 Mr Maskaleh confirms that Mr Skaf said on the first occasion that he wished to put up the rent on the workshop and that Mr Skaf said on the second occasion that the rent would be $1,000 a week. Mr Maskaleh also confirms that on the second occasion Mr Shimess did not accept the proposed rent. I should note that Mr Skaf does not suggest otherwise.
19 Thereafter, Mr Skaf says, Mr Shimess telephoned him and accepted the proposal for $1,000 a week rent plus GST and told Mr Skaf to "go ahead with the new lease." Mr Shimess denies that this conversation took place; and he denies that then or at any other time he agreed, on behalf of himself and his brother, to a rent of $1,000 per week.
20 Mr Skaf instructed the plaintiff's solicitors, a firm known as Equity Lawyers. The principal of that firm is Mr Ziad Naef. Mr Naef says that he received instructions on 8 February 2006. Those instructions referred to the leasing of the workshop at the property to the defendants, and include (according to a file note):
Tenant to pay:
Outgoing - proportion.Rent: 1,100 - P/W (GST incl)
21 Mr Naef handed the “file” to an employed solicitor, Ms Leoni Gittani. Ms Gittani handled the matter until about June 2006, when she went overseas. Thereafter, Mr Naef became involved once again.
22 Ms Gittani saw Mr Skaf in conference. She prepared a file note of her instructions. Those instructions included the following:
($1,000 plus GST)Rent: Equals $1,100 inclusive of GST
23 The file note also indicated that the defendants were to be responsible for 40 percent of all outgoings, and that electricity was to be separately metered.
24 Finally, for present purposes, the file note recorded:
“Bond equals 1 months [sic] rent plus GST."
25 It is not clear, either from Ms Gittani's file note or from her affidavit or oral evidence, to what period (week, month, quarter or whatever) the stated figure of rent was referable.
26 Ms Gittani prepared a form of lease. She said that she did so by adapting a precedent that she had available to her in the office. The draft lease stated that the rent was in accordance with "item number 9 of reference schedule". Item 9 of the reference schedule stated that the rent was "$12,000 per annum to be paid by equal monthly instalments of $1,000 plus GST."
27 The reference schedule also provided for outgoings. In relation to the question of "Guarantee/Security Deposit", it provided for "an amount equivalent to one months rental plus GST".
28 In her affidavit, Ms Gittani said that she took the precedent that was available on her computer and inserted the details relevant to the particular transaction. She said that at that time the precedent "in relation to rent contained the words 'per month' so that if I was told, for example, that the rent for a property was to be $2,000 a month, I would simply insert the amount '2,000' in front of the words 'per month' on the precedent. I did not need to type in the words 'per month'."
29 That explanation does not sit easily with the form of lease that was put in evidence. As I have said, on the first page of the lease, the rental is simply defined by reference to item 9 of the schedule. The same reference is made in the interpretation clause (clause 1). The clause dealing with payment of rent (clause 3) again refers to the reference schedule. In the reference schedule, the words "per month" do not appear. Instead, as I have indicated, it appears to provide for the payment of an amount "per annum ... by equal monthly instalments".
30 This apparent inconsistency between Ms Gittani's affidavit evidence and the form of the reference schedule was not addressed in cross-examination. Nonetheless, the existence of the inconsistency makes it a little difficult to accept at face value this particular aspect of her evidence.
31 Ms Gittani sent the form of lease off to the defendants' solicitors, James Lahood & Associates. Mr Raed Rahal (who appears to have been known as Roy) was the employed solicitor in that office having day-to-day responsibility for the lease. He says that he received it, reviewed it, and noted a number of clauses that required attention. Most importantly, however, Mr Rahal says that he noted that the rent reserved by the lease - $12,000 per annum - was substantially less than the rent currently being paid by his clients. Mr Rahal was in a position to know this, because the previous proprietor of the property was a company owned or controlled by his brothers, for whom he had acted.
32 Accordingly, Mr Rahal says, he contacted Ms Gittani by telephone and drew the discrepancy to her attention. He says that he inquired whether the rent stated was "the amount that your client wanted" and that he pointed out that his clients "were paying more when my brothers had control of the service station". According to him, Ms Gittani replied that she had "had a conference with my client and that's what he instructed." There was then he says, reference to the need to quantify outgoings.
33 Ms Gittani does not accept that such a conversation occurred. She says that had it occurred she would have kept a file note of it; she would have contacted Mr Skaf; she would have kept a file note of that contact; and that the file contains no such notes.
34 Thereafter, the transaction proceeded at a leisurely pace, with some to-ing and fro-ing in relation to redrafting particular clauses of the lease. That process was apparently concluded to Mr Rahal's satisfaction (or, at least, to a point where he was no longer in a position to push for further amendments) by about late May 2006. On that day, Ms Gittani sent certain documents to Mr Rahal, including "execution page in duplicate", and asked when the executed lease might be received back.
35 It is not entirely clear whether further changes occurred thereafter. However, on 12 July 2006, Mr Rahal wrote to Equity Lawyers. By then, as I have indicated, Ms Gittani had ceased to have responsibility for the matter and Mr Naef had resumed responsibility. The letter enclosed a number of things including a duplicate executed lease, evidence of insurance in the required amount, and cheques for payment of various amounts of costs and outgoings. It also enclosed:
“Bank cheque in favour of Lugarno Petroleum Pty Ltd in the amount of $1,100 being the rental bond amount".
36 There was then yet further to-ing and fro-ing over stamp duty. Presumably, this was resolved.
The events of September 2006
37 On 1 September 2006, Mr Skaf prepared a handwritten invoice addressed to the defendants (as "G.S.S."). The invoice claimed rent from 1 September 2006 to 1 October 2006 in the amount of $4,331.82, together with GST in the amount of $433.18. It will be observed that the rent claimed corresponds almost exactly to a weekly rent of $1,000 dollars exclusive of GST.
38 That document was delivered to the defendants' workshop on 4 September 2006. Mr Shimess says that he received it and noted that the amount claimed was not, as he understood should be the case, referable to a rent of $1,000 per month. He wondered whether there had been the inclusion of amounts for outgoings, and accordingly asked Mr Rahal to investigate the matter. It would seem that the investigation undertaken by Mr Rahal was limited to looking at the lease, noting that the rent was $1,000 plus outgoings, and that outgoings were payable on a monthly basis. Thus, Mr Shimess says, he understood that the rent would be $1,000 together with GST of $100 together with outgoings which he calculated (based on figures in the lease) at $158 per month. Accordingly, he paid rent for the month in the amount of $1,258 and, I think, some odd cents.
39 Mr Shimess says that he had had unfortunate experiences with his first landlord. Accordingly, he says, he was not prepared to pay any amount on account of rent until he was assured that the plaintiff had committed itself to the lease. This assurance appears to have come on 4 September 2006 when, by telephone and by facsimile transmission, Mr Naef confirmed to either Mr Lahood or Mr Rahal that the plaintiff had executed the lease.
40 When Mr Skaf ascertained that the amount paid by rent was substantially less than the amount of his invoice, he sought to discuss it with Mr Shimess. There were several meetings.
41 There are substantial disputes as to what occurred in those meetings. It is not necessary to resolve those disputes. On the view that I take of this case, the issues are to be resolved by reference to the events leading up to the execution of the lease, and events that occurred thereafter are only relevant to the extent that they inform an understanding of the evidence given by any witness of those earlier events. In my view, the discussions in relation to the amount of rent that took place in September 2006 generated more heat than light; and certainly generated no light on the question of where the balance of persuasion should be found to lie.
First and second issues: what if any rent was agreed before the lease was executed?
42 As I have said, it is the plaintiff's case that Mr Skaf stipulated for a rent of $1,000 per week, clear of GST and an appropriate percentage of outgoings, and that Mr Shimess accepted this. On any view of the case, that acceptance did not occur in what Mr Skaf places as the second of the meetings, but (at least on Mr Skaf's evidence) some time later.
43 In considering this point, it is necessary to bear in mind that the plaintiff bears the onus of proof. That onus of course is an onus on the balance of probabilities. However, it is in my view necessary for the Court to have a sense of actual persuasion in favour of the conclusion for which the plaintiff argues, before that burden of proof can be satisfied. Further, in circumstances where there is an executed agreement that is inconsistent with the plaintiff's case as to what the true underlying agreement was, the achievement of that state of actual persuasion requires that there be some convincing evidence that is rationally capable of leading to the required degree of satisfaction. As to the latter point, see the judgment of Street J in Australasian Performing Right Association Limited v Austarama Television Pty Ltd [1972] 2 NSWLR 467 at 474. His Honour's statement, which I have paraphrased, was approved by Menzies J in Hooker Town Developments Pty Ltd v The Director of War Service Homes (1973) 47 ALJR 320 at 323-324.
44 In this case, on the question as to whether an amount of rent was discussed between Mr Skaf and Mr Shimess, I prefer the evidence of Mr Skaf. In saying this, I do not wish it to be thought that I think that Mr Shimess sought to mislead the Court. I do not think that. I think that he sought, to the best of his ability, to give evidence of the relevant events as he now recalled them. I am however of the view that his evidence - and indeed, for that matter, the evidence of Mr Skaf - was to some extent coloured unconsciously by a sense of self-validation. That is to say, I think that each of Mr Shimess and Mr Skaf has come to believe that the version of events that he propounded, no doubt to some extent reflecting in each case their respective interests, is correct.
45 I should also make it clear that in assessing the evidence, not only of Mr Skaf and Mr Shimess, but of the other witnesses, I do not place any significant reliance on the influence of demeanor. All the witnesses gave evidence in English, being in many cases a language that was not their native language. At least Mr Skaf and Mr Shimess, and also I think Mr Maskaleh, were less than familiar with the Court environment. Although there were aspects of their demeanor that might have excited the attention of judges in the old days, I do not think that it is appropriate for a judge in my position to attribute his own views of what is or is not appropriate behaviour in a witness box to a person from a different culture, giving evidence in a language that is not his native language and in a situation which on any view is extremely stressful.
46 In short, in this case, I think that demeanor is an even more unreliable guide than usual to where the balance of persuasion should be found to lie.
47 However, there are a number of features that support Mr Skaf's evidence that he did mention a rent of $1,000 per week. One feature is the corroborating evidence of Mr Maskaleh. Although Mr Maskaleh appears to have been confused in his identification of Mr Lahood, rather than Mr Rahal, as the solicitor who attended one of the September meetings with which I have not dealt in any detail, I regard that as an entirely understandable mistake after the passage of some two years. I am also conscious, having reflected upon that particular portion of the transcript, that the suggestion that the solicitor was Mr Lahood rather than Mr Rahal may have been something that Mr Maskaleh thought was being put to him in cross-examination, and with which he agreed. I do not regard this particular problem in his evidence as reflecting on his general credibility. In particular, I do not regard it as requiring that his evidence in corroboration of Mr Skaf's evidence should be disregarded.
48 Mr Maskaleh does not give evidence that corroborates Mr Skaf's evidence of acceptance, nor could he. That is said to have occurred in a later telephone conversation.
49 Further, as I have said, Mr Skaf indicated that a third party had offered him rental of $1,000 per week for the workshop. That third party - a Mr Saad - has confirmed that he did offer that amount. There is nothing in Mr Saad's evidence that persuades me that I should not accept it on this point. I regard it as a corroborative circumstance.
50 Thirdly, there is Mr Naef's file note. It was not put to him that the file note was other than an accurate record (so for as it goes) of the instructions given to him. Thus, quite apart from the fact that I thought that Mr Naef was a reliable witness where his evidence was supported by contemporaneous documents, I think that the file note does confirm that Mr Skaf instructed him that the rent was to be $1,000 per week plus GST.
51 Finally, although somewhat remote in point of time, there is Mr Skaf's invoice of 1 September 2006 to which I have referred.
52 However, taking all that evidence at its highest, it confirms only that Mr Skaf asked for a rent of $1,000 per week together with GST and a proportion of outgoings. It does not confirm that Mr Shimess agreed to this.
53 The evidence as to agreement is limited to Mr Skaf's account of the telephone conversation. That is denied by Mr Shimess. To the extent that the evidence of either was informed by self-interest, or what I have referred to as self-validation, those considerations cut equally and in opposite directions. They do not mean that the evidence of one should be preferred over the evidence of the other.
54 On balance, I am not satisfied, on the basis of any proof that induces in me the requisite feeling of persuasion, that there was a concluded oral agreement as to the amount of rent. Firstly, as I have said, there is an outright conflict in the evidence of the people responsible. Secondly, so far as external circumstances are capable of shedding any light upon the matter, I think that they are at best neutral, and in reality probably slightly in favour of the defendants.
55 On the one hand, it might be thought to be unlikely that Mr Skaf would have instructed Equity Lawyers to go ahead and prepare a draft lease if he were not satisfied as to the existence of an agreement on the essential issue of rental. But on the other hand, there is Mr Rahal's evidence (which is supported by the evidence of Mr Shimess) that at the time Mr Rahal was instructed, there had been no agreement as to rent. If I were to conclude that there had been an agreement then it would be necessary to conclude also either that Mr Shimess deliberately misled Mr Rahal on this point or that Mr Rahal's evidence on this point is wrong. I am not prepared to reach either of those conclusions.
56 Thus, on the first and second issues, I am not satisfied that there was an antecedent oral agreement that a net rent of $1,000 per week be paid in relation to the workshop. It follows, in relation to the second issue, that if the executed lease did not properly reflect the agreement as to rent, that is not because there was any discrepancy between the rent stated in it and the rent that had been earlier agreed.
57 Further, on this analysis, it is at least open to argue that the submission of the draft lease specifying an annual rent of $12,000 together with GST and a proportion of outgoings constituted an offer. If that analysis is one to be followed, then the defendants accepted the offer when they executed the lease (following agreed amendments) and returned it. On an objective analysis, the agreement was concluded when the plaintiff in turn executed the lease.
Third issue: the defendants' awareness of any mistaken belief
58 I think it follows from what I have said as to Mr Skaf's state of mind, and in particular from the invoice of 1 September 2006, that at all times Mr Skaf was of the view that the rent reserved by the lease was $1,000 per week and not $1,000 per month. However, it does not follow that the defendants, knowing that the lease provided for a rental of $1,000 per month, knew of Mr Skaf's mistaken belief, let alone sought unconscientiously to take advantage of it.
59 Central to this aspect of the case is the conversation that Mr Rahal says he had with Ms Gittani following receipt of the draft lease. I am quite certain that each of Mr Rahal and Ms Gittani sought, to the best of his and her respective abilities, to give evidence that was as complete and accurate as possible. I am quite certain that neither of them intended, or sought, to mislead the Court in any way. As I have indicated, I do not think that a resolution of the evidentiary issues is to be resolved by questions of demeanor, although in this case that is because I formed the impression that each of them sought to be truthful.
60 The question is one to be resolved again by reference to extrinsic circumstances, together with a consideration of what appears to be the strength of recollection of each of them.
61 On Mr Rahal's evidence, he was told that there had been no agreement as to rental. However, when he saw the draft lease, he understood that there would be, at least prima facie, a substantial reduction from what was presently being paid. It is no doubt correct to say that the inclusion of GST and the responsibility for some proportion of outgoings would to some extent diminish the gap between the present and the proposed rent. However, they would not do so to any substantial degree.
62 Again, it is undoubtedly the case that the cost of electricity would have been substantial. Mr Rahal says that he knew this because, as I have said, his brothers had owned and run the property. There is no evidence of what a "substantial" electricity bill might be. I think I can take notice of the fact that service stations use electricity for all sort of reasons, including pumping fuel, powering compressors and other equipment, and operating hoists in workshops. I am prepared to assume that they are heavy users of electricity. But I cannot proceed from there to find that the workshop's electricity bill would have been so substantial as to lead to a significant closing of the gap between the existing (free of GST and outgoings) rent and what was proposed by the draft lease.
63 In those circumstances, I think, it is inherently likely that Mr Rahal, surprised by the apparent reduction in rental, would have sought to confirm it. Thus, I think, it is more likely than not that he would have had some contact with Ms Gittani. Ms Gittani denies there was such a contact.
64 What I think is clear, is that if some inquiry of the kind to which I have referred took place then it is likely that Ms Gittani would have replied that $12,000 per annum, or $1,000 per month, was what "the client wanted". She would have needed only to refer to her file note on that point, which clearly she understood as stipulating a monthly rent of $1,000 clear of GST.
65 Further, I thought, Ms Gittani had little actual recall of relevant events except insofar as her memory was supported by file notes. I do note that she said that she would have made a file note of this conversation had it occurred, and that she would have sought instructions and made a file note of those instructions. I accept that the file contains no such note. Nonetheless, I am not prepared to infer, from the absence of those records, that the conversation did not take place.
66 It is also somewhat surprising that Mr Rahal made no independent record of the conversation. He neither recorded it in any file note nor confirmed it by letter. However, if I am to find that the conversation did not take place, it would follow either that Mr Rahal is telling deliberate untruths in his affidavit - untruths marked by an alarming degree of what, on this hypothesis, would be flagrant invention; or that he sought to mislead his client in a most serious way. I am not prepared to infer, let alone conclude, that Mr Rahal did act in that way.
67 Accordingly, on balance, I conclude that the conversation in question did take place.
68 There is something else that bears on this aspect of the issue. It was suggested to Mr Rahal, in support of the proposition that the conversation did not take place, that he had a motive not to draw to the plaintiff's attention that there was any error in the lease. It was suggested, in substance, that the defendants and Mr Rahal well appreciated that the lease contained a mistake, and were very keen to ensure that the plaintiff "signed up" before it became aware of the mistake.
69 In my view, there is independent evidence that requires that this submission be rejected. As I have pointed out, the reference schedule to the lease stipulated that the guarantee/security deposit was to be an amount equivalent to one months rental plus GST. As I have also pointed out, on 12 July 2006 - on the evidence, well before the plaintiff executed the lease - Mr Rahal sent a letter to Equity Lawyers enclosing, among other things, the cheque for $1,100 "being the rental bond amount". A moment’s consideration would have indicated that the cheque was intended to represent one month’s rental plus GST. If Mr Rahal were seeking to withhold from the plaintiff any appreciation that the lease stipulated a monthly rental of $1,000, it is inconceivable that he would have referred to the bond cheque in the manner that he did.
70 Although the significance of this letter only appeared in submissions, so that neither Mr Rahal nor Mr Naef was cross-examined on it, I think that I am entitled to infer that it is consistent with the absence, from Mr Rahal's mind, of the motive for suppression that was put to him.
71 I note also that, by the time the letter in question was sent, it was Mr Naef who was handling the file on behalf of the plaintiff. Even if Ms Gittani remained under the misapprehension that she appears to have endured as to the amount of rent, there is no reason to think that Mr Naef did. His file note of 8 February 2006 shows the contrary.
72 Thus, in relation to the third issue, I conclude that the defendants were not aware that the plaintiff suffered under the mistaken belief to which the issue refers. On the contrary, I think, they were reassured, by Mr Rahal's inquiry of Ms Gittani, that the plaintiff intended the lease to read as it did.
73 I should mention that the submissions for the plaintiff dwelled also on the event of September 2006. It was put that Mr Shimess had deliberately refrained from taking any step that might draw to the plaintiff's attention the fact that the rent reserved by the lease was $1,000 per month until he was assured that the plaintiff was bound to the lease. In light of the prior matters to which I have referred, that submission cannot be accepted. I do not think that Mr Shimess acted by reason of the motive that was put to him.
Fourth issue: Did the defendants take unconscientious advantage of any mistake?
74 It follows from what I have said that this issue must be answered “no”.
Fifth issue: relief
75 It follows from what I have said that the plaintiff is not entitled to any of the relief prayed by the summons in this case.
Conclusion and orders
76 The plaintiff has failed to satisfy me of its case, in either of the ways in which it is put. I order that the summons be dismissed. I order the plaintiff to pay the defendants' costs. I order that the exhibits remain with the papers for 28 days and that thereafter they be dealt with in accordance with the rules.
0
1
0