Tiger Crane Hire P/L v Lonsdale Properties P/L - [2010] SADC 41

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
TIGER CRANE HIRE P/L v LONSDALE PROPERTIES P/L
[2010] SADC 41
Judgment of His Honour Judge Nicholson
22 March 2010
EQUITY - EQUITABLE REMEDIES - INJUNCTIONS
Landlord purported to re-enter commercial premises and to terminate a tenancy for non payment of rent and other alleged breaches. Tenant allowed to remain in occupation. Findings that various triable issues existed between the parties and the balance of convenience strongly favoured the granting of an injunction to preserve the status quo. HELD interlocutory injunctions granted on terms.
Retail and Commercial Leases Act 1995 (SA) s18, s68; Landlord and Tenant Act 1926 (SA) s11, referred to.
Australian Broadcasting Commission v O'Neill (2006) 227 CLR 57; Acmnet Pty Ltd v Al Tel Pty Ltd [2007] SASC 96; Cini v Pets Paradise Franchising (SA) Pty Ltd (2008) 102 SASR 177; Aboriginal Development Comm v Ralkon Agricultural Co Pty Ltd (1987) 15 FCR 159; Legione v Hateley (1983) 152 CLR 406, considered.

TIGER CRANE HIRE P/L v LONSDALE PROPERTIES P/L
[2010] SADC 41

The plaintiff in this matter is the tenant of the defendant. The plaintiff occupies premises which were constructed by and on behalf of the defendant to suit the plaintiff’s purposes and from which the plaintiff conducts a crane hire business. The plaintiff assumed occupancy pursuant to a signed Agreement for Lease dated 14 November 2008. It is provided for by the terms of the Agreement for Lease and it has been the expectation of the parties that both the plaintiff and the defendant would execute a formal lease of the premises for an initial term of ten years.
The plaintiff went into possession in early April 2009. It is common ground that almost from the beginning the parties fell into dispute over a number of matters. During the first nine or ten months of the tenancy the tenant was late, from time to time, in paying the monthly rent. The parties have been in dispute over whether money expended by the plaintiff to secure telephone communication services, satisfactory to the plaintiff, was properly payable by the defendant and, if so, whether or not the plaintiff is entitled to offset that amount against rent for the month of May 2009 as it has purported to do. Various other matters of dispute have also arisen between the parties including the terms of the lease to be executed.
Throughout 2009 and early 2010 the defendant issued a number of Notices of Default. However, matters came to a head, in practical terms, when the defendant issued a Notice of Default on 2 February 2010 following which, on 17 February 2010, it purported to re-enter into possession of the premises, to terminate the tenancy and to distrain the plaintiff’s property.
By Summons dated 18 February 2010 the plaintiff commenced proceedings in this court seeking declaratory and other relief in the following terms:
1.an order pending suit that the defendant, its servants or agents be restrained from entering the premises situated at 10 Ellemsea Circuit Lonsdale until further order;
2.a declaration that the plaintiff has properly set off the loss it incurred in relation to telephone communication expenses against its obligation to pay rent;
3.a declaration that the plaintiff is entitled to damages on account of the defendant’s breach of the lease by failing to provide the plaintiff proper telephone communication services and an enquiry as to the amount of the same;
4.a declaration that the plaintiff is not obliged to sign the lease containing clause 33 in the terms proposed by the defendant;
5.a declaration that clause 33 of the proposed lease as amended by the plaintiff properly reflects the agreement between the parties.
6.in the alternative, a declaration that in the circumstances of the dealings between the parties the plaintiff is entitled to the protection of s 18 of the Retail and Commercial Leases Act 1995 (SA);
7.a declaration that the notice issued by the defendant dated 27 January 2010 is invalid;
8.a declaration that the defendant’s agent improperly remained on the premises on 17 February 2010 and that the plaintiff is entitled to damages with respect to the same;
9.an enquiry as to the damages incurred by the plaintiff on account of the defendant’s agent improperly remaining on the premises on 17 February 2010;
10.a declaration that the lease between the parties has not been forfeited and has not been terminated by the defendant;
11.in the alternative, an order pursuant to s 11 of the Landlord and Tenant Act 1926 (SA) giving the plaintiff relief against forfeiture;
12.the costs of this application; and
13.such further and other orders as this Court thinks fit.
Accompanying the Summons was an Interlocutory Application seeking an injunction in the terms of proposed order number 1 set out above.
The matter came before me for the first time on 19 February 2010 at which time I made orders for the filing of affidavits after noting an undertaking given by the defendant, through its counsel, that was intended to ensure that the plaintiff could continue to conduct its business from the premises pending the outcome of its application for an interlocutory injunction. The matter was argued before me on 26 February 2010 with both parties having filed affidavit material in support of their respective positions and both parties being represented by counsel. The following affidavits were read at the hearing of the plaintiff’s application:
(i)on behalf of the plaintiff, affidavit of Peter Scragg sworn 18 February 2010 with nine exhibits;
(ii)on behalf of the plaintiff, affidavit of Kelly Lynn Allen sworn 24 February 2010 with two exhibits;
(iii)on behalf of the defendant, affidavit of Mark Patrick Burns sworn 19 February 2010 with fifty six exhibits;
(iv)on behalf of the defendant, affidavit of Mark Patrick Burns sworn 22 February 2010 with one exhibit; and
(v)on behalf of the defendant, affidavit of Mark Patrick Burns sworn 26 February 2010 with seven exhibits.
The defendant also provided a written outline of submissions.
At the time of the purported re-entry of the premises by the defendant on 17 February 2010 the issues in contention between the parties included the following:
(i)The defendant asserted that there was an underpayment of rent for the month of May 2009 in the amount of $1,452.49 wrongfully withheld by the plaintiff on account of its asserted entitlement to be re-imbursed for the cost of works done with respect to telephone communication services (referred to during the argument as the “withheld amount”).
(ii)The plaintiff was in arrears of rent for the months of January and February 2010.
(iii)An amount on account of building insurance, allegedly payable by the plaintiff, remained unpaid.
(iv)The plaintiff had not signed a lease in the terms provided to it and insisted upon by the defendant.
(v)The plaintiff’s guarantors had not signed a form of guarantee in terms insisted upon and as proposed by the defendant.
Money was paid by the plaintiff on the day of the purported re-entry and negotiations took place between representatives of the plaintiff and of the defendant, as a result of which the plaintiff was permitted to remain in the premises and permitted to continue to conduct its business from the premises. The nature of these negotiations and the terms upon which the plaintiff was permitted to remain in the premises are adverted to and to some degree set out in the affidavit evidence together with the correspondence exhibited. The plaintiff maintains that the defendant’s purported re-entry was not completed nor effective to terminate the tenancy and that, following negotiations, the plaintiff remained in occupation in accordance with the terms of the Agreement for Lease that were in place immediately before the defendant purported to re-enter. The defendant maintains that the re-entry was effective, that the tenancy came to an end and that the effect of the subsequent negotiations was that the plaintiff could remain in possession of the premises on a periodic tenancy subject to complying with various conditions. The defendant maintains that these conditions have not been adhered to.
At all times, the monies unpaid by the plaintiff and allegedly due and payable to the defendant have been relatively small in amount when consideration is had to the fact that the parties’ contractual arrangement was for a ten year tenancy with an initial rent of $6,333.33 per calendar month. Nevertheless, it is plain that the defendant is seriously concerned about the capacity or willingness of the plaintiff to abide by the terms of the agreement to the letter over the prospective ten year period. It is fair to say that the relationship has got off to an extremely rocky and unfortunate start. Having said that, the matter cries out for a commercial solution. Provided that the plaintiff were to maintain the wherewithal to pay the rent on time, it would seem that the only potentially significant dispute is as to the terms of the lease that must be executed by both parties and assented to by the plaintiff’s guarantors. The parties have already executed an Agreement for Lease and the plaintiff’s guarantors have already provided a signed and written guarantee of the plaintiff’s obligations pursuant to the Agreement for Lease. It would seem that if the parties cannot reach agreement as to the terms of the formal lease that each is obliged to execute, this issue of the applicable terms would readily be determinable by the court by way of a construction summons and granting of declaratory relief.
By the time the plaintiff’s application for an interlocutory injunction was heard the dispute between the parties had narrowed somewhat although it had become overlaid with costs arguments. As at the time the matter was argued before me the issues in contention between the parties were the following.
(i)The only shortfall of rent was the so called withheld amount of $1,452.49. Otherwise, the rent was paid up to date.
(ii)The plaintiff is liable to pay the council rates and does not dispute this. However, it was late in paying a particular quarter and as a result the defendant paid it and sought to recover its payment from the plaintiff. At or about the same time the plaintiff also paid the rates for the same quarter. The council has refused to re-imburse the amount and has indicated that it will hold it on account of the next quarter’s rates which, in time, also will be payable by the plaintiff. In these circumstances the plaintiff, in open court, conceded that it owed the defendant the amount of $670.90 paid by the defendant on account of council rates.
(iii)The defendant now claims legal costs relating to its attempts to enforce its asserted rights under the Agreement for Lease. The defendant maintains that it has a contractual right to these costs independently of that which a court might order in circumstances where legal proceedings are commenced and completed. The defendant’s contractual entitlement to costs and the quantum claimed by the defendant is not, as yet, conceded by the plaintiff.
(iv)The parties are still in dispute as to the terms of the lease which must be signed and performance of which the guarantors must agree to guarantee.
At the end of the argument on 26 February 2010 the defendant, through its counsel, renewed its earlier undertaking to, in effect, permit the plaintiff to remain in occupation of the premises and to conduct its business therefrom until such time as I were to deliver my decision and reasons concerning the plaintiff’s application for an interlocutory injunction. However, the giving of that undertaking was subject to the following matters.
(i)The plaintiff was to reimburse the defendant the amount of $670.90, on account of council rates, on Monday 1 March 2010.
(ii)Payment of the rent for the month of March 2010 was to be made by the plaintiff on Monday 1 March 2010.
(iii)The plaintiff was to pay into the defendant’s solicitors’ trust account, within 14 days of 26 February 2010, that is, by Friday 12 March 2010, the amount of $2,919.65. This amount was calculated as comprising the withheld amount of $1,452.49 together with a portion of the amount then claimed by the defendant on account of its legal costs in taking the steps that it has taken to enforce its asserted rights under the Agreement for Lease.
I turn to the plaintiff’s application for interlocutory relief. In order to obtain an interlocutory injunction the plaintiff must satisfy the legal requirements for such relief as reformulated by the High Court in Australian Broadcasting Commission v O’Neill.[1] These requirements can be stated[2] in the following terms:
(1)Whether there is a serious issue to be tried, namely, that the applicant has a sufficient likelihood of success at trial;
(2)Whether the inconvenience or injury that the applicant would be likely to suffer if an injunction were to be refused outweighs the injury the respondent would be likely to suffer if an injunction were to be granted; and
(3)That damages are not an adequate remedy.
Whether or not the issue of damages being an adequate remedy is a third and separate requirement or to be dealt with as part of the balance of convenience issue is, perhaps, a matter of debate following Australian Broadcasting Commission v O’Neill. However, on the view I take of the matter before me that issue does not need to be determined.
[1] (2006) 227 CLR 57.
[2] Cf; Acmnet Pty Ltd v Al Tel Pty Ltd [2007] SASC 96 (Layton J).
The serious issue to be tried question is to be approached by asking whether the plaintiff has shown a sufficient likelihood of success to justify, in the circumstances, the preservation of the status quo pending the trial and having regard to the practical consequences likely to flow from the granting of the injunction sought. It is not necessary for the plaintiff to show that there is a real prospect of success at trial.[3] It has also been observed, within the context of earlier formulations of the test, that the court must not be misled by an over-restrictive application of the verbal formulae so as not to do complete justice in the cause.[4]
[3] Cf; Cini v Pets Paradise Franchising (SA) Pty Ltd (2008) 102 SASR 177.
[4] Aboriginal Development Comm v Ralkon Agricultural Co Pty Ltd (1987) 15 FCR 159.
The affidavit evidence and the submissions put on behalf of the parties disclose that there are a number of issues of fact and law that divide the parties:
(i)the effectiveness or otherwise of the defendant’s purported termination of the tenancy by way of the purported re-entry and resumption of possession of the premises and the effectiveness or otherwise of its purported distraint of the plaintiff’s property;
(ii)if the tenancy was effectively terminated, whether the parties renegotiated an entitlement in the plaintiff to resume possession of the premises, on terms;
(iii)if so, the nature of those terms and whether or not they have been complied with or, if not, the extent to which they have not been complied with; and
(iv)in the event that there has been an effective re-entry giving rise to a termination of the tenancy at law, would a court grant relief against forfeiture of the plaintiff’s proprietary interest in the premises.
It is not possible on the state of the affidavit evidence alone to finally determine any of these issues. Ordinarily, these matters would need to be determined at a trial following the hearing of oral evidence concerning the events deposed to in the various affidavits. Furthermore, the plaintiff argues that even if the defendant ultimately were found to be correct such that it had, in February 2010, a legal entitlement to terminate the tenancy and the contractual arrangements between the parties and that it effected such a termination by its conduct, there would be three bases upon which a court might grant relief against forfeiture of the plaintiff’s proprietary interest in the premises previously enjoyed pursuant to the terms of the Agreement for Lease.
The first potential basis arises under s68 of the Retail and Commercial Leases Act. According to the defendant, an application for relief against forfeiture under this section could only be made in the Magistrates Court because the monetary matters in dispute between the parties are likely to be less than $6,000. This may be right. Furthermore, in the event that the contractual arrangement between the parties comprises either a “retail shop lease” or a “collateral agreement” as those terms are defined in the Retail and Commercial Leases Act any application under s68 may have to be made to the Magistrates Court. Nevertheless, provided that the Magistrates Court’s jurisdiction, under s68, would be engaged, jurisdiction would still arise in this court to grant an interlocutory injunction, in appropriate circumstances, in aid of the plaintiff pursuing such a remedy. It may be, of course, that the arrangements between the parties in this matter cannot be said to comprise a retail shop lease or a collateral agreement, as defined, in which case no jurisdiction under s68 will arise and no basis for an injunction in this court could arise. I do not stay to consider these issues any further because I am of the view that this court does have jurisdiction to grant the equitable relief sought by the plaintiff on other grounds.
The second possible basis for the plaintiff to obtain relief against forfeiture is that provided for by s11 of the Landlord and Tenant Act. It may be that the plaintiff would be confined in bringing its claim for relief against forfeiture on this basis to proceeding by action in the Supreme Court. Again, I do not need to decide this. It seems to me that even if this were to be the case, this court would have jurisdiction to grant an interlocutory injunction, if the circumstances otherwise warranted, so as to preserve the status quo and to enable the plaintiff to bring its application for relief in the appropriate court.
The third basis upon which the plaintiff may ground its application for relief against forfeiture is the general equitable power illustrated by the High Court’s decision and reasoning in Legione v Hateley.[5]
[5] (1983) 152 CLR 406 at 424 and see generally the discussion in Contract Law in Australia, Carter and Harland 4^th Ed Butterworths at para.[1979] and following.
I am satisfied that both the second and third bases for an application for relief against forfeiture are available to be argued by the plaintiff in the present case.
It may be that relief against forfeiture would only be available in the event that the purported forfeiture was based on non-payment of rent or other monies due and payable under the lease, such that relief could be granted on terms that all outstanding monies and costs were to be met by the plaintiff. In other words, to the extent that the defendant’s claim against the plaintiff is that it is in breach of contract for not signing lease terms in the form propounded by the defendant as being those mandated by the terms of the Agreement for Lease, it may be arguable that any forfeiture resulting from such a breach would not be amenable to relief. However, in these circumstances, it is the plaintiff’s case that the defendant, to the extent that it is relying on an alleged breach by the plaintiff in not signing the lease terms, is asserting and relying upon a construction of the Agreement for Lease with which the plaintiff does not agree. Equity can be invoked to enjoin a party from asserting and relying upon an incorrect contractual construction and thereby acting in or threatening a breach of contract. In other words, the defendant can be enjoined from terminating the tenancy and in this case the contractual arrangements between the parties as effected by the Agreement for Lease if to permit it to do so would be to allow it to act in breach of contract. In these circumstances, an interlocutory injunction will again lie to preserve the status quo until that issue of construction can be resolved in the appropriate way.

Having reviewed the affidavit evidence I am not satisfied that the facts and circumstances concerning the actions of the parties throughout the history of their relationship to this point and, in particular, at the time of the purported re-entry by the defendant and its aftermath, can be found with any confidence without the various persons who were involved giving oral evidence and being cross-examined on that evidence. In other words, the affidavit evidence before the court is simply not sufficient to enable the making of factual findings necessary to underpin conclusions that the defendant was entitled to behave as it did, that it effectively terminated the tenancy in the way it purported to do and that the plaintiff would not be entitled to relief against forfeiture in the circumstances.
I am satisfied on the affidavit evidence before me that matters giving rise to triable issues include the following.
(i)Are the plaintiff and its guarantors obliged to sign a lease document in the terms as propounded by the defendant? In this respect it should be noted that the Agreement for Lease provides that the parties are to execute a lease in the form either attached to the Agreement for Lease or as previously provided to the plaintiff. There is some evidence in the affidavit evidence filed on behalf of the defendant that a form of lease had been provided to the plaintiff. However, this evidence is infused with hearsay, lacks clarity and is as yet untested. Furthermore, it is claimed that there have been on-going negotiations between the parties as to the terms of the proposed lease and it may be necessary to hear evidence about these matters and for the court to form a view about the extent to which, if at all, either party has altered its position. I accept that the plaintiff, in its affidavit evidence, does not directly challenge the defendant’s evidence on the issue that a lease had previously been provided to it. Nevertheless, given the manner in which this matter has been prepared and brought forward for hearing, I am prepared to accept that it is an issue that may well have been overlooked at the time of the preparation of affidavits. On any analysis, the question of what comprises the terms of the formal lease document required to be signed by both parties is a matter that can only be determined after the hearing of further evidence and full argument.
(ii)If the plaintiff and the guarantors are not contractually obliged to execute a lease document containing the terms asserted by the defendant, what formal lease terms, for the ten year period, are the parties obliged to execute?
(iii)Is the plaintiff entitled to payment by the defendant of the withheld amount of $1,452.49?
(iv)If the plaintiff is so entitled, is it entitled to set off that amount against the rent and in particular the rent for May 2009? The answer to this question may depend, to a large degree, on the answer given to (i) and (ii) above.
(v) Has there been an effective re-entry and termination of the plaintiff’s tenancy?
(vi)If so, are the circumstances such that a court would grant the plaintiff relief against forfeiture and/or relief by way of enjoining the defendant from breaching the parties’ contract?
(vii)Is the defendant contractually entitled to costs incurred with respect to its purported re-entry and its efforts made in order to recover late payment of rent? Again, the answer to this question may depend, to a large degree, on the answer given to (i) and (ii) above.
I turn briefly to the question of the balance of convenience. At present the defendant has a tenant in occupation of the premises who is obliged by the Agreement for Lease to pay a rent of $6,633.33 per calendar month. Notwithstanding that there has been some late payments and some short payments in the past the rent is, at present, up to date and the landlord has a contractual entitlement to enjoy that rent for as long as the plaintiff remains in occupation. The plaintiff’s obligations under the Agreement for Lease are presently guaranteed by the required guarantors. In the event that an injunction were to be granted requiring the defendant to allow the plaintiff to remain in occupation provided that it observes the terms of the Agreement for Lease and continues to pay the rent as and when it falls due, it is difficult to see what harm the defendant is likely to suffer in the event that it ultimately were to succeed at trial. In other words, if the defendant were ultimately to succeed, the plaintiff would be forced to vacate the premises, the defendant would have its premises returned to it and available for re-letting and in the meantime the plaintiff will have paid the monthly rent or, at worst, the defendant will have accrued a debt in its favour for that monthly rent.
As against this, in the event that no injunction were to issue and the defendant were to be permitted to resume possession of the premises, such could have extremely serious consequences for the plaintiff. It would no longer have available to it the purpose built premises. It would have to look for other suitable premises to enable it to conduct its business and in the meantime would be likely to suffer significant costs of relocation and disruption to its business. It also would face the prospect of a damages claim by the defendant which might be quite significant if the defendant were unable to quickly re-let these purpose built premises to another tenant for the same or a greater rent. Given that the premises are purpose built, it is more than possible that the defendant would have to expend money on further capital works to the premises to make them satisfactory to an alternative tenant and ultimately any such expenditure would form part of its damages claim against the plaintiff.
I accept the submission of the plaintiff’s counsel that the consequences of allowing his client to be evicted are potentially catastrophic for the plaintiff whereas it would appear that all the defendant will suffer should an injunction lie is further inconvenience, further irritation and, at worst, some loss of rent for the time it might take for this matter to be resolved, if it turned out that the plaintiff was unable to continue to meet its financial obligations. Furthermore, and given these considerations, in the event that any eviction of the plaintiff ultimately were to be found wrongful, I am not satisfied that damages would necessarily be an adequate remedy for the plaintiff.
In my view, the balance of convenience strongly favours the plaintiff. I am also satisfied that the plaintiff has shown a sufficient likelihood of success with respect to each of the triable issues referred to above (particularly that in (vi) but excluding that in (iii)) so as to justify in all of the circumstances – including the fact that the balance of convenience heavily favours the plaintiff – the preservation of the status quo until trial. Whilst I have found that the issue in (iii) can be characterised as a triable issue, the plaintiff, to this point, has not put forward sufficient evidence in support of the plaintiff’s alleged entitlement to be reimbursed the withheld amount for me to be satisfied of a sufficient likelihood of success with respect to this issue.
The plaintiff’s application for injunctive relief will be allowed. The questions that remain to be determined are the terms of that relief and the conditions upon which it will lie. I propose to impose two conditions. First, that the plaintiff provides the usual undertaking as to damages and second, that the plaintiff remits to the defendant the withheld amount in full, subject of course to a reservation of rights.
It is not disputed that the plaintiff owes the full amount of rent for the month of May 2008. What is in dispute are (a) whether it is entitled to be re-imbursed by the defendant the withheld amount on the basis that the plaintiff incurred an expense concerning the telephone communication works which should have been paid for by the defendant; and (b) whether the plaintiff is entitled to set that off as against rent payable. The plaintiff has yet to establish either (a) or (b) and cannot do so whilst it refuses to sign terms of lease. There is nothing in the Agreement for Lease nor in the terms of lease as propounded by the defendant nor in the variations to the terms of lease as sought by the plaintiff which would support a contractual entitlement to such a set-off. There is nothing in the affidavit evidence read on behalf of the plaintiff nor was anything put in submissions that gave rise to an argument that the plaintiff was entitled to a contractual right of set-off. Unless the plaintiff has a contractual right under the formal lease terms (once determined) to reduce the rent payable for any given month by the amount of any monies due from the defendant to the plaintiff, the position is simply one of asserted mutual debts.
In other words, the plaintiff might be found entitled, by way of defence to a claim brought by the defendant for the rent, to plead a set-off at law or even perhaps in equity. However, until such time as legal proceedings were to be commenced and defended, the position is, as I have said, simply one of the existence of asserted mutual debts. These alleged mutual debts arose in May of last year. However, the defendant’s entitlement to the rent is uncontested and has been so since then, whereas the plaintiff’s alleged entitlement to the withheld sum is contested. A determination of that contest has not really been advanced over the last eleven months or so. Furthermore, as I have indicated, I am not satisfied that the plaintiff, to this point, has demonstrated on the evidence a sufficient likelihood of success in proving its entitlement to a reimbursement of the withheld sum.
In the event that a claim for relief against forfeiture were to be made and granted, I think it is quite likely that a court would require the rent to be brought up to date, including the withheld sum, leaving the plaintiff to separately pursue its claim to the extent it can be established. In any event, equitable relief such as the granting of an interlocutory injunction, is discretionary and can be granted on terms. In all of the circumstances I think it is fair and appropriate that the plaintiff be required to bring all of its rent obligations up to date, if it is to have its equitable relief, and that includes the payment over of the withheld sum. This payment will be by way of a direction of the court and not by way of determination of that aspect of the dispute. The plaintiff remains at liberty to pursue its claim against the defendant for this amount in debt or on such other legal basis as it might establish.
I propose to make the following orders.
By the plaintiff undertaking to abide by any order the court or a judge may make as to damages in case the court or a judge should hereafter be of opinion that the defendant shall have sustained any by reason of this order which the plaintiff ought to pay:
1.Until further order the defendant by itself or by its agents or employees be restrained from
(i)re-entering the premises situated at 10 Ellemsea Circuit, Lonsdale, being the premises presently occupied by the plaintiff, in reliance on any Notice of Default issued on or prior to 17 February 2010;
(ii)taking any steps of any nature whatsoever to prevent the plaintiff from occupying the said premises in accordance with and on the basis of the terms set out in the said Agreement for Lease, in reliance by the defendant on any alleged default by the plaintiff raised by the defendant with the plaintiff at or prior to the hearing of this matter on 26 February 2010.
(iii)taking any step of any nature whatsoever to continue with or implement any purported distraint previously exercised by the defendant against the plaintiff’s property;
2.The injunctions in Order 1 are conditional on the plaintiff, within 14 days of the date of these orders, paying to the defendant the sum of $1,452.49 on account of unpaid rent for the month of May 2009.
3.In the event that the plaintiff has prior to the date of these orders paid a sum in excess of $1,452.49 into the defendant’s solicitors’ trust account to be held by that firm of solicitors pending the resolution of the present dispute between the parties, the plaintiff’s obligation under Order 2 will be satisfied by providing, within 14 days of the date of these orders, a letter of authority directed to the defendant’s solicitors authorising them to release to the defendant the sum of $1,452.49 from those monies held in trust, such release to be in full discharge of the plaintiff’s obligation under Order 2.
4.The plaintiff’s Summons filed in this Court on 18 February 2010 is to be listed before a Master of this Court as soon as practicably possible for directions to be made as to the further prosecution of the plaintiff’s claim for final relief as set out in that Summons.
5.Either party is to have liberty to apply to the Short Notice List Judge, on short but reasonable notice to the other, for a variation or revocation of these orders.
6. Costs of the plaintiff’s application for interlocutory relief are reserved.
I propose to reserve costs because any contractual entitlement to costs that may be available to the defendant cannot be explored and finally determined until the terms of the parties’ contract have been identified, be they the terms of a formal lease document yet to be executed or the terms of the Agreement for Lease alone or both. It is appropriate that this aspect of the defendant’s claim for costs be dealt with at the same time as the hearing of the other matters in dispute between the parties. Insofar as the costs of this interlocutory application are concerned, it is appropriate that the court has a better understanding of the merits of the parties’ respective claims before determining the extent, if any, of one party’s liability for costs to the other with respect to these interlocutory proceedings.
The orders that I propose are intended to resolve the plaintiff’s application for interlocutory relief with reference to the parties’ conduct as at the date of the argument before me on 24 February 2010. The injunctions granted are not intended to inhibit any rights or remedies that may be open to the defendant in the event that there are any further breaches of the Agreement for Lease (save for any continuing failure by the plaintiff and its guarantors to execute a formal lease) or breaches of any other arrangements entered into between the parties that had not been raised by the defendant with the plaintiff as at the hearing of this matter on 26 February 2010.
Before entering the proposed orders as set out above, I would like to hear the parties further on the form of the proposed injunctions in Order 1 and on proposed Order 6 to reserve costs.