Nguyen v Nguyen
[2013] QCAT 315
•6 June 2013
| CITATION: | Nguyen v Nguyen & Anor [2013] QCAT 315 |
| PARTIES: | Kim Chi Nguyen (Applicant) |
| V | |
| Trung Viet Nguyen Mai Que Nguyen (Respondents) |
| APPLICATION NUMBER: | RSL045-12 |
| MATTER TYPE: | Retail shop leases matters |
| HEARING DATE: | 28 and 29 May 2013 |
| HEARD AT: | Brisbane |
| DECISION OF: | Dr J R Forbes, Presiding Member Mr N Judge, Member Mr D McBryde, Member |
| DELIVERED ON: | 6 June 2013 |
| DELIVERED AT: | Brisbane |
| ORDERS MADE: | 1. The application is dismissed. 2. Kim Chi Nguyen t/as Dakbla Vietnamese Asian Cuisine shall vacate the subject premises not later than 5 pm on Friday 19 July 2013. 3. Kim Chi Nguyen t/as Dakbla Vietnamese Asian Cuisine shall remove all her fixtures and fittings and make good all or any damage resulting from such removal, or compensate Trung Viet Nguyen and Mai Que Nguyen for the same. 4. There is no order as to costs. 5. The Principal Registrar is directed to report to the appropriate authority the Respondents’ failure to comply with section 46 of the Retail Shop Leases Act 1994. |
| CATCHWORDS: | RETAIL SHOP LEASE - OPTION TO RENEW – tenant omits to exercise option in time stipulated in lease - whether that provision waived - whether lessors promised not to rely on time limit - whether alleged promise made – whether promise, if made, unequivocal – whether, if promise made, reasonable relied on – application dismissed – breach of Retail Shop Leases Act 1994 s 46 referred to appropriate authority Retail Shop Leases Act 1994 (Qld), s 19, s 36, s 36A, s 46, s 47 Topbeach Pty Ltd v Seafarer Investments Pty Ltd [2010] QSC 459 Agricultural and Rural Finance Pty Ltd v Gardiner (2008) 238 CLR 570 Bell Group Ltd (in liq) v Westpac Banking Corporation (No 9) (2008) 70 ACSR 1; [2008] WASC 239 |
APPEARANCES and REPRESENTATION:
| APPLICANT: | Ms C J Conway of counsel instructed by Trinity Partners, solicitors |
| RESPONDENT: | Mr D Atkinson of counsel instructed by T Lawyers Pty Ltd, solicitors |
REASONS FOR DECISION
The applicant Kim Che Nguyen (“the Tenant”) is sole proprietor of a restaurant known as Dakbla Vietnamese Asian Cuisine, trading at 65 Hardgrave Road, West End, Brisbane (“the premises”).
The premises are the property of the respondents Trung Viet Nguyen and Mai Que Nguyen (“the Landlords”).[1] The Tenant went into occupation on 7 April 2006 as assignee, and subsequently held the premises under a lease from the Landlords commencing on 7 April 2009 and due to expire on 6 April 2012 (“the lease”).
[1] While some documents in these proceedings name the Respondent as Gateway
Property Investments Pty Ltd, the lease names as lessors Trung Viet Nguyen and Mai Que Nguyen, and the Notice of Dispute filed on 5 April 2012 properly names only those two persons as Respondents.
It is common ground that the lease contained options to renew for two 3-year periods.
It is also common ground that Clause 22.1 of the lease required the Tenant to give the Landlords written notice of intention to exercise an option to renew at least 6 months before the 6 April 2012, that is, no later than 6 October 2011.
It is undisputed that the Tenant failed to give the Landlords any such notice.
On 17 February 2012, by her then solicitors, A P Hodgson and Associates, the Tenant purported to exercise an option to renew the lease as from 6 April 2012.
On 21 February 2012 the Landlords rejected the Tenant’s said notice as out of time, and gave her notice to vacate the premises by 6 April 2012.
However, the Tenant, by interim order or by arrangement inter partes, remains in occupation of the premises.
The Tenant's Case
The Tenant seeks a declaration that the Landlords waived, or are equitably estopped from relying upon Clause 22.1 of the lease, and that she remains entitled to renew her tenancy, as from 6 April 2012.
For that purpose the Tenant relies[2] on a conversation between her husband, Hien Dinh and the respondent Mai Que Nguyen, which allegedly took place on 4 October 2011.
[2] Affidavit of Kim Chi Nguyen filed 14 March 2013, paragraph 5.
Hien Dinh deposes[3] that on 4 October 2011, at about 9 am, he arrived at the premises to purchase a few items at nearby shops. He went to the “back deck” of the Red Hen (a restaurant adjoining the premises) and there he “bumped into” the second Respondent, Mai Que Nguyen (“Mai”). Mai "was in deep discussion with a man who I later learnt to be Peter Hahn ... the Respondents’ handyman.” Mai and Hahn were discussing repairs to the deck, as required by a compromise[4] that ended an earlier action between these parties.[5] According to Dinh he said to Mai:
[M]y wife and I do not need you to make major repairs to the decking ... all we want is to be able to have the renewal of the lease and to continue with the business – that renewal is the issue most important to the both of us.[6]
[3] Affidavit of Hien Dinh filed 14 March 2013, paragraphs 3 to 16.
[4] Terms of Settlement dated 7 September 2010, paragraph 7, concerning access to
toilets for the Tenant’s customers.
[5] The earlier proceedings, involving several points of dispute, details of which are now
immaterial, were commenced by a Notice of Dispute filed by the Tenant on 10 February 2010.
[6] Affidavit of Hien Dinh filed 14 March 2013, paragraph 9.
To which (according to Dinh) Mai replied:
The decking must be fixed before we can all talk about the renewal of the lease. The lease renewal can be dealt with afterwards ... [E]ven though the inspection and repair works have been delayed and is [sic] late[7], I will attempt to fix the problems for the decking. Then we can all discuss the lease renewal later and there is no need to have this brought before QCAT again ... Mr Hahn will fix a time and date so that he can come back and fix the decking.[8]
[7] The terms of settlement set a limit of 3 months for the repairs.
[8] Affidavit of Hien Dinh filed 14 March 2013, paragraph 12; italics as in original.
That evening, feeling “happy and pretty relieved” Dinh related the alleged conversation to his wife, the Tenant –
We had the choice of taking our lawyer’s advice and have my wife bring the matter back before QCAT or rely on our former friend ... Mrs Nguyen’s verbal assurances and trust her on the matters that had been said.[9]
[9] Affidavit of Hien Dinh filed 14 March 2013, paragraph 16.
Dinh does not specify the language in which he and Mai, or Mai and Hahn conversed. At the hearing he testified that he is unable to speak or read English, and gave evidence through an interpreter.
Cross-examined, Dinh “thought” that relations between his wife and Mai post-2009 were good until the present action began: “We still meet and I am still very friendly”. He rejected a suggestion that Mai did not speak to him after February 2010.[10] The crucial meeting with Mai was accidental; he was not invited to attend. He could clearly recall the date of the meeting because his daughter Sarah, as the Tenant’s amanuensis, sent their solicitor an email the next day, 5 October 2011. His conversation with Mai and Hahn was not confined to repairing the deck. At that time “he didn’t really think” about when the lease was due to expire. He didn’t know much about its details. “We didn’t receive any documents”. He didn't know that the Tenant had to give written notice of intention to renew; he "thought that [the Landlords] had to send a written notice”.
[10] The Tenant’s first action against the Landlords began in February 2010.
The Tenant's final witness was her daughter, Sarah Dinh, who testified without an interpreter. In her affidavit[11] Sarah states that on 5 October 2011 the Tenant told her to send an email to the Tenant's then solicitor, Mr Hodgson, to say that Mai Nguyen came to the premises on the previous day “to fix the back decking”,[12] and she did so. On the previous evening she heard her parents “discussing the conversation that my dad had with ... Mai Nguyen on 4 October 2011 regarding the back decking. They also discussed their option to refer the matter [of deck repairs and non-compliance with the terms of settlement] back to QCAT.”
[11] Filed 20 June 2012.
[12] Sarah’s email dated 5 October 2012 is included in Exhibit 1, under tab 5.
Sarah does not say that she heard her parents discussing the renewal of the lease. Briefly cross-examined, Sarah conceded that she made no notes of relevant conversations, other than her email of 5 October 2011.
The Respondents' Case
The second Respondent, Mai Que Nguyen agrees that she went to the premises to examine the deck with Peter Hahn. However, she is adamant that their visit did not occur on 4 October 2011, as alleged by Hien Dinh. She says that it took place after 7 October 2011, when her solicitor told her that the deadline for exercise of the option had expired. In fact, she says, the meeting with Hahn was on 12 October 2011. At 8.13 am that day she made a mobile phone call to Hahn to confirm that he was coming. She tendered an extract from her Telstra account showing a call to Hahn's phone number at that time and on that date.[13] Her identification of Hahn’s phone number is not disputed.
[13] Affidavit of Mai Que Nguyen sworn 1 May 2012, paragraphs 3, 4 and 6, and annexure.
Mai Nguyen proceeds: On the morning of 12 October 2011, at the Red Hen Cafe, Hien Dinh approached Hahn and herself and said: "The deck need [sic] no repair and only a few nails to reinforce". In accordance with her solicitor's advice, she ignored him and Hahn did the same. She said nothing on that occasion to Dinh, and she emphatically denies that she ever "promis[ed] to renew the lease ... by conduct or verbal representation".[14]
[14]Affidavit of Mai Que Nguyen sworn 1 May 2012, paragraph 10; see also paragraphs 7 and 11.
Cross-examined, Mai Nguyen repeated her account of Dinh’s unexpected appearance on 12 October 2011. She agreed that Dinh said that the deck didn’t need major repairs, but repeated her assertion that neither he nor she said anything about the lease.
The second and final witness for the Landlords was their handyman, Peter Hahn. He is the author of two affidavits[15], and attended for cross-examination.
[15] Affidavits of Peter Hahn, sworn 18 April and 2 May 2012.
In his first affidavit Hahn states that his initial inspection of the deck took place “in or about mid-October 2011”. On 26 October 2011 he returned to Hardgrave Road West End to tell Mai that he would do the work 2 days later. On 3 November 2011 he arrived to do the work. However, he then found that the Tenant’s furniture and fittings were still on the deck, and she refused him access to the premises. He left, and did not visit the premises again.[16]
[16] Affidavit of Peter Hahn, filed 18 April 2012, paragraphs 4 – 8.
In his second affidavit Hahn is more specific about the date of his first visit to the premises, that is, the occasion when Hien Dinh appeared. After consulting a note in his work diary (to which he did not have access when making his first affidavit) Hahn deposes that his first visit to the premises was on 12 October 2011. He has no recollection of hearing any discussion between Dinh and Mai about the lease.
... I saw Mr Hien Dinh approaching us and [he] said words to the effect that the deck did not need repair and that it needed some nails for reinforcement. [Mai] then spoke to me in Chinese, words to the effect: “No need to answer him, you just do what you have to do pursuant to the court order”[17]. We both ignored what Mr Dinh said and then I left as I had to go to work.[18]
[17] An inaccurate reference to the terms of settlement dated 7 September 2010, which
contain no reference to the option.
[18] Affidavit of Peter Hahn, sworn 2 May 2012, paragraphs 2 – 4.
Copies of relevant extracts from Hahn’s diary are Exhibit 3.
Cross-examined, Hahn said that his diary notes showed that on 4 October 2011, and again on 12 October 2011 he was not at West End, but was building a house at Red Hill, several kilometres away, on the other side of the Brisbane River. He agreed that his notes are sparse, being just records of where he worked, and who worked for him on particular days.
Consideration
The only direct evidence of the alleged promise to relax the notice requirement[19] is that of the Tenant’s husband, Hien Dinh, describing a conversation with Mai Nguyen, in the presence of Peter Hahn, on 4 October 2011. The Tenant admits that she did not exercise her option within the time limited by the lease, but bases her claim for relief upon pleas of waiver and promissory estoppel. We consider these submissions a little later on.
[19] Lease Clause 22.1.
The Tenant also argues that the Landlords’ admittedly late delivery of a notice required by section 46 of the Retail Shop Leases Act 1994 (“RSLA”) means that the time for exercise of the option is no longer “of the essence”. Section 46 provides that where a retail shop lease provides for an option on the lessee's part to renew or extend the lease, the lessor must give the lessee written notice of the last date for exercise of the option at least 2 months, but no longer than 6 months, before that deadline arrives.
Failure to comply with section 46 renders the landlord liable to a maximum penal sanction of 40 penalty units, but no other adverse consequence is prescribed. Elsewhere, by way of comparison and contrast, the RLSA imposes clear civil law consequences for non-compliance with the provisions concerned.[20] It is reasonable to infer that, if the legislature intended section 46 to be sanctioned other than by a fine, it would have expressly said so. Margaret Wilson J found this consideration persuasive in Topbeach Pty Ltd v Seafarer Investments Pty Ltd[21], where she observed:
A question has arisen whether the general law position[22] is affected by section 46 of the [RSLA] ... Section 46 creates an offence ... It says nothing about the consequences of non-compliance as between parties. Counsel for the plaintiff really made no submissions as to why [that] inference ... should be drawn. I am not satisfied that there is a triable issue as to the application of section 46.
[20] See s 19 (no contracting out), s 36 (certain rent review provisions void), s 36A (ratchet
rent provisions void), s 47 (lessee’s right to independent legal advice).
[21] [2010] QSC 459.
[22] Note that her Honour did not confine these dicta to the type of case in hand, namely an
application for an interlocutory injunction.
While those dicta occur in an interlocutory decision, we are not aware of any authority to the contrary. Decisions on section 46 of the RSLA, as it stood before the year 2000,[23] are of no assistance. We reject the submission based on section 46. We do not consider that it relieves a tenant from the responsibility to note and observe the terms of his or her lease.
[23] HR & CE Griffiths Pty Limited v Rock Bottom Fashion Market Pty Ltd & Ors [1997] QSC
5; RockBottom Fashion Market Pty Ltd & Ors v HR & CE Griffiths Pty Ltd [1998] QCA 33.
Waiver?
We turn to the plea of waiver. In legal parlance “waiver” is a notoriously imprecise word, sometimes described as “a substitute for thought”, or “a cloak that covers a multitude of sins”.[24] It has several different applications. There is waiver of privilege, waiver of a right to a hearing, waiver of an evidentiary or procedural point, and waiver of a contractual right. In the latter sense it is “best understood as a genus comprising consent, estoppel and acquiescence.”[25] Clarity of doctrine is not advanced by Commonwealth of Australia v Verwayen[26], in which two members of the majority (Toohey and Gaudron JJ) relied on waiver, and two (Deane and Dawson JJ) upon estoppel. Waiver is often used as a synonym for estoppel; indeed, they may be indistinguishable.[27] In any event -
The better view is that a mere indication of an intention not to rely upon contractual rights will not generally constitute a waiver sufficient to bar a future action to enforce such rights. Waiver should not be seen as an alternative weapon to estoppel in the war against the doctrine of consideration.[28]
[24] Mann v Carnell (1999) 201 CLR 1 at 13; Agricultural and Rural Finance Pty Ltd v
Gardiner (2008) 238 CLR 570 at 586-588.
[25] Byrnes v Kendle (2011) 243 CLR 253 at [74].
[26] (1990) 170 CLR 394.
[27] Agricultural and Rural Finance Pty Ltd v Gardiner (2008) 238 CLR 570 at 586;
Kostopoulos v GE Commercial Finance Australia Pty Ltd [2005] Q Conv R 54-634; [2005] QCA 311 at [36].
[28] Freshmark Ltd v Mercantile Mutual Insurance (Australia) Ltd [1994] 2 Qd R 390 at 397
per Dowsett J, cited with approval in Kostopoulos, above; Scandinavian Trading Tanker
Co AB v Flota Petrolera Escuatoriana (“The Scaptrade”) [1981] 2 Lloyd’s Rep 425 at 430; affd [1983] 2 AC 694.
Estoppel?
Promissory estoppel may arise when a party to an agreement indicates, in sufficiently clear terms, that he will not insist on strict compliance with a term that exists for his benefit. The "indicator" may then be prevented from departing from his promise, if the other party reasonably relies upon it, and if departure is likely to cause detriment to the latter. Properly proved, promissory estoppel may prevail over the terms of a wholly written agreement.[29] But detriment aside, the indication must be clear,[30] it must actually be relied upon, and reliance upon it must be reasonable[31].
[29]Wright v Hamilton Island Enterprises Ltd [2003] Q Conv R 54-588; [2003] QCA 36; Equuscorp Pty Ltd v Glengallen Investments Pty Ltd [2006] QCA 194 at [118]-[119]; Johnston v Arnaboldi [1990] 2 Qd R 138.
[30] PS Chelleram & Co Ltd v China Ocean Shipping Co Ltd [1991] 1 Lloyds Rep 493;
Legione v Hateley (1983) 152 CLR 406 at 436-437; Coshott v Barry [2007] NSWSC 1094.
[31] Telstra Corporation Ltd v Mahon (2004) 39 AAR 484; [2004] FCA 1404; Downward
Bricklaying Pty Ltd v Goulburn-Murray Rural Water Authority (2003) 8 VR 61; Bell Group Ltd (in liq) v Westpac Banking Corporation (No 9) (2008) 70 ACSR 1; [2008] WASC 239.
But of course, the practical operation of these principles requires a sufficient foundation in the evidence in a particular case.
We have already held that the Landlords’ non-compliance with RSLA section 46 does not constitute a waiver. The alternative pleas, that Mai Nguyens’ alleged promise to Hien Dinh on 4 October 2011 constitutes a waiver and/or estoppel, stand or fall with the evidence of what really transpired when Dinh (as he says) “bumped into” Mai Nguyen and Peter Hahn at the premises on 4 October 2011.
The first difficulty is that neither the Tenant nor Hien Dinh made any attempt to clarify or confirm the alleged conversation in documentary form, although each declared that the crucial issue for them was not the deck repairs, but renewal of the lease.
On 5 October 2011, the morning after the alleged meeting, the Tenant's amanuensis, Sarah Dinh, emailed the Tenant’s solicitor as follows:
I have spoken to my Mum [the Tenant] about the next step what to do. She said to me that the owner of the shop Mrs Nguyen came to the shop yesterday and just checking things around at the back deck said that she’s trying to get someone to come to site [sic] to have it Fix soon, [sic] so at this stage my Mum said we just wait a lil [sic] to see what [sic] happen then will inform you soon.
This communication, as will be seen, focuses upon the deck repairs referred to in a compromise, dated 7 September 2010, of an earlier action by the Tenant against the Landlords. There is not one word about a promise to relax the notice requirement, allegedly made to Dinh on 4 October 2011, and “relayed” to the Tenant the same day.[32] Yet we are told that it was the lease renewal, not the deck, that really mattered to Dinh[33] and to the Tenant[34] at the time.
[32] Affidavit of Hien Dinh filed 14 March 2013 paragraph16.
[33] Dien cross-examination: “I said what we needed most was [a] lease to continue the
business.”
[34] Tenant cross-examined: “If she was willing to do repairs, OK, but I just needed a
renewal”.
Sufficiently clear?
In Dinh’s version of his conversation with Mai Nguyen on 4 October 2011 Mai did not say, in effect: “I will renew the lease”, or “It does not matter that you didn't give notice in time”. She merely said: “The decking must be fixed before we can all talk about the renewal of the lease. [It] can be dealt with afterwards”.[35] It is reasonable to expect that a Tenant to whom a renewed lease was crucial would seek, at the first opportunity, to have those equivocal words made unequivocal, and in writing. But the Tenant took no such action. Nor was any such attempt made in her former solicitor’s letters to the Landlords’ lawyers on 31 October 2011, 4 November 2011, 16 December 2011, or 17 February 2012.[36] The same comment applies to Sarah Dinh’s email to the Landlords on 2 November 2011.[37]
[35] Affidavit of Hien Dinh filed 14 March 2013 paragraphs 10 and 12, emphases added.
[36] Exhibit 1, tabs 7, 8, 12 and 1, respectively.
[37] Exhibit 1 tab 8.
The evidence of Hien Dinh, and the Tenant's unquestioning reliance upon his report of the alleged conversation with Mai Nguyen might be more acceptable if relations between the parties were cordial and trusting at the material time. Indeed, the Tenant seems to have realised this when cross-examined on the point. Initially evasive, she eventually conceded that by 2011, her attitude to the Landlords was “cautious”. That is hardly surprising, because in February 2010 the Tenant brought her first action against the Landlords,[38] filed an affidavit referring to several disagreements and forthrightly deposed:
I brought this application as I believe that the actions of both Trung and Mai Que Nguyen amounted to trickery and misrepresentation.[39]
[38] Notice of Dispute RSL 010-10, filed 10 February 2010.
[39] Affidavit of Chi Kim Nguyen filed 2 July 2010 paragraph 68.
Therefore we are unable to accept that there was such sweetness and light between the parties in October 2011 that a verbal assurance that a lease renewal could be “talked about” later on would have been made, or, if were made, that it could reasonably be relied on by the Tenant, without further question or attempt at documentation. After all, discussions about the relatively unimportant deck repairs were copiously documented. It is not without significance that Hien Dinh, in the very act of narrating the alleged promise, referred to Mai Nguyen as "our former friend".[40]
[40] See paragraph [13], above, emphasis added.
Hahn's Evidence
The evidence of Peter Hahn, to say the least, does not enhance the Tenant’s case. Hahn swears that when Hien Dinh “bumped into” him and Mai Nguyen while Hahn was inspecting the deck, he (Hahn) heard nothing about renewal of the lease. According to Hahn - and in this he supports the evidence of Mai Nguyen - Dinh merely made a brief comment about the deck, which he and Mai simply ignored.
Furthermore, Hahn’s contemporary notes of his work commitments are quite inconsistent with Dinh’s story of a meeting with Hahn and Mai Nguyen on 4 December 2011. (Dinh does not suggest that it occurred on any other day.) According to Hahn’s work diary[41] that meeting took place on 12 October 2011, when the option to renew was no longer available. No attack was made upon Hahn’s credit, or upon the accuracy of his diary notes. We accept him as an honest and reliable witness.
[41] Exhibit 3.
In conclusion, we are far from satisfied, on the balance of probabilities, that the Tenant has discharged the onus of proving that the alleged promise was made.
That is sufficient to dispose of the action. However, we may add that, if (contrary to our finding) it was made, it is too equivocal to give rise either to a waiver or to promissory estoppel.
Further, if it was made, and leaving its ambiguity aside, we consider that reliance upon it would not be reasonable, having regard to the prior litigation, and the ill feeling that clearly existed between the parties by October 2011.
Accordingly the application will be dismissed. There will be no order as to costs. Lack of success, without more, does not enliven the discretion in section 102 of the QCAT Act.
If the Tenant considers that her former solicitors did not give her sufficient warning of the time limit for valid exercise of her option, she may proceed to seek appropriate legal advice.
There will be orders for the Respondents, in terms of items 1, 2, and 4 of Attachment B of the Response filed on 5 April 2012, subject to a reasonable time to vacate. It is agreed that there are no arrears of rent.
We shall direct the Principal Registrar to inform the appropriate authority of the Respondents' admitted failure to comply with section 46 of the RSLA. The Tribunal, of course, has no criminal jurisdiction.
ORDERS
1. The application is dismissed.
2. Kim Chi Nguyen t/as Dakbla Vietnamese Asian Cuisine shall vacate the subject premises not later than 5 pm on Friday 19 July 2013.
3. Kim Chi Nguyen t/as Dakbla Vietnamese Asian Cuisine shall remove all her fixtures and fittings and make good all or any damage resulting from such removal, or compensate Trung Viet Nguyen and Mai Que Nguyen for the same.
4. There is no order as to costs.
5. The Principal Registrar is directed to report to the appropriate authority the Respondents’ failure to comply with section 46 of the Retail Shop Leases Act 1994.
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