Re Ritchie

[1995] QSC 80

IN THE SUPREME COURT

OF QUEENSLAND

O.S. No. 282 of 1995

Brisbane

Before the Hon. Justice Williams

[Re Ritchie]

IN THE MATTER of "The Rules of the Supreme Court"

AND

IN THE MATTER of an Application by JOHN DOUGLAS RITCHIE for construction of the consent order made by Justice Williams on 16 September 1994 in O.S. No. 696 of 1994

JUDGMENT - WILLIAMS J

Judgment delivered  11/05/1995

CATCHWORDS:     Construction - consent order - held lease for second option period granted and not fresh lease

Counsel:Hackett for applicant

Varitimos for respondent

Solicitors:Puryer & Co. for applicant

Patrick J. Murphy Town Agent for respondent

Hearing date:    2 May 1995

IN THE SUPREME COURT

OF QUEENSLAND

O.S. No. 282 of 1995

IN THE MATTER of "The Rules of the Supreme Court"

AND

IN THE MATTER of an Application by JOHN DOUGLAS RITCHIE for construction of the consent order made by Justice Williams on 16 September 1994 in O.S. No. 696 of 1994

JUDGMENT - G N WILLIAMS J

Judgment delivered 11/05/1995

On 16 September 1994 I initialled a draft consent order which was handed up to me by the legal representatives of the parties.  Subsequently a formal consent order was issued under the Court Seal. 
           A dispute has arisen as to the proper construction of that consent order.  An originating summons has been taken out seeking a declaration as to its proper construction.  The order incorporates by reference a document being a lease identified as "ex. JDR2".  Clearly regard can be had to the terms of that document when construing the order in question.
           In the applicant's material there was reference to an opinion formed by his solicitor as to its meaning prior to the making of the order, and to certain advice which that solicitor then gave to the applicant.  The respondent, in the light of that, sought to place material before the Court dealing, inter alia, with the negotiations which resulted in the agreement forming the basis of the consent order.  Counsel for the applicant objected to the reception of that material from the respondent, but then had to concede that if that was not admissible the passages referred to from the applicant's material would also not be admissible.  I accepted the submission of counsel for the applicant that the respondent's material referred to was not admissible, and in consequence ruled out all of the passages referred to. 
           The respondent then sought to place before me the originating summons filed on 26 August 1994 which commenced the proceedings in which the order was made and the supporting affidavit.  That was objected to by counsel for the applicant on similar grounds to that referred to above.  I reserved my decision on the admissibility of that material.
           Counsel for the respondent argued that the order should be construed in the context of the proceedings in which it was made.  There is certainly force in that submission, but it must also be remembered that a consent order, being an agreement between the parties, can go beyond the relief sought in the originating summons.  Where the meaning was clear a consent order would not be read down merely because its provisions went beyond the relief formally claimed. 
           The question of the admissibility of the summons (O.S. 696 of 1994) is somewhat academic because in the heading of the consent order, the very document being construed, there appears the following:

"In the matter of an application by John Douglas Ritchie for the grant of relief in relation to the exercise of the renewal of an option under lease agreement between John Douglas Ritchie and Glenn Robin McLean and Genevieve McLean."

In the circumstances, bearing in mind that the consent order may go beyond the relief claimed in the summons, I will rule that the summons and supporting affidavit are not admissible on this application; but I will also rule that I may have regard to the passage quoted above from the heading of the draft order because it is part of the document being construed.
           But having said that it should be recorded that the heading carries little probative value of itself because of the fact that a consent order may grant relief wider than that claimed.
           The body of the order in question is in these terms:

"IT IS ORDERED BY CONSENT:-

1.The term of the lease referred to in paragraph 2 of the affidavit of John Douglas Ritchie filed herein on 26 August, 1994 a copy of which is exhibit 'JDR2' thereto is extended so as to commence on 23 September, 1994 and terminating on 22 September 1997 and is binding on the parties as if executed by the Applicant as Lessee and the Respondents as Lessor.

2.The summons is dismissed.

3.There is no order as to costs."

The construction contended for by the applicant is to the effect that the lease "extended so as to commence on 23 September, 1994 and terminating on 22 September, 1997" included "two further three year option periods".  On the other hand the respondent contended that no further option periods were included because the extended term to 22 September 1997 was in effect the second option period referred to in the lease being ex. JDR2.
           Before proceeding further it is necessary to refer to certain terms of the lease which is ex. JDR2. 
           In cl. (9) of Form 8 it was specified that the commencing date and terminating date of the initial term of the lease were respectively 23 September 1988 and 22 September 1991.
           Other terms and conditions of the original lease are to be found in the schedules.  Clause A2 of the schedule provided that therein 23 September 1988 was called "the date of commencement" and the term of the lease of three years commencing 22 September 1988 was thereinafter called "the term".  The Fourth Schedule provided that the first option period should be three years and the Fifth Schedule provided that the second option period should be three years.  Clause 13.01 and 13.02 are in these terms:

"13.01  Grant of Option If the Lessee shall have observed and performed the conditions and stipulations herein on its part to be observed and performed (and shall continue to do so throughout the rest of the present term) the Lessee shall have the option of renewing or extending the term hereby granted for the further period defined in the Fourth Schedule hereto commencing from the expiration of the term hereby granted.  Such option shall be exercised by the Lessee in writing not less than two (2) calendar months nor more than six (6) calendar months before the expiration of this term whereupon the Lessor shall grant and the Lessee shall take the demised premises for such further or extended term at such rental for the first year as may be agreed upon and otherwise upon the same terms and conditions as are herein contained and applicable but excluding this present clause.

13.02   Further Grant of Option  If the lessee shall have observed and performed the conditions and stipulations herein during the original term of this Lease and the first option period on its part to be observed and performed (and shall continue to do so throughout the rest of the present term) the Lessee shall have the option of renewing or extending the term hereby granted for the further period defined in the Fifth Schedule hereto commencing from the expiration of the renewed term of Lease granted under the preceding Clause.  Such option shall be exercised by the Lessee in writing not less than two (2) calendar months nor more than six (6) calendar months before the expiration of the renewed term (granted under the preceding clause hereof) whereupon the Lessor shall grant and the Lessee shall take the demised premises for such further or extended term at such rental as may be agreed upon and otherwise upon similar terms and conditions as are herein contained and applicable but excluding the present clause and the preceding clause."

It is immediately obvious that the period mentioned in the consent order, namely the term commencing 23 September 1994 and terminating 22 September 1997, is identical with the second option period referred to in the lease being JDR2.  That circumstance gives greater significance to the description of the relief then being claimed by the applicant as evidenced by the statement in the heading to the consent order. 
           But what, in my view, is of even greater significance is the use of the phrase "is extended" in the consent order in the light of the expression "extending the term hereby granted" in cl.13.02 (and also 13.01).  The consent order conveys the meaning that the term of some earlier existing lease was thereby being extended so that the period 23 September 1994 to 22 September 1997 could properly be referred to as an extended term; that is to be contrasted with a situation where a fresh lease was being created the first term of which was the period 23 September 1994 to 22 September 1997. 
           In my opinion if the intention of the parties at the time of agreeing to the terms of the consent order was that there should be a new lease in similar terms to the earlier one but having as the first term a period from 23 September 1994 to 22 September 1997 an expression other than "the term of the lease...is extended" would have been used to evidence the agreement. 
           For those reasons I conclude that the construction contended for by the applicant is not tenable.  It follows that the declaration sought by the applicant in the summons should be refused, but to avoid any further confusion it is desirable that a declaration be made confirming the true position as between the parties.  I would therefore declare that the Consent Order made by Justice Williams on 16 September 1994 in O.S. No. 696 of 1994 grants to the applicant as lessee a lease for the second option period referred to in the lease which is ex. JDR2 to the affidavit of John Douglas Ritchie filed therein on 26 August 1994.
           I should also record that the applicant did not contend for the relief sought in para. 2 of the summons given that evidence of the negotiations was excluded. 
           There will be a declaration in terms of that noted above and an order that the applicant pay the respondent's taxed costs of and incidental to the application.