West End Motor Group Pty Ltd v Fisher

[2000] NSWSC 255

CITATION:	West End Motor Group Pty Ltd v Fisher [2000] NSWSC 255
CURRENT JURISDICTION:	Equity
FILE NUMBER(S):	SC 2673/97
HEARING DATE(S):	14 December 1999
JUDGMENT DATE:	8 March 2000
PARTIES :	West End Motor Group Pty Ltd (formerly W A Fisher Enterprises Pty Ltd) (P & 1XD) William Austral Fisher (D1 & XC) W A Fisher Pty Ltd (D2) Terry J Dodd (2XD) Alan John Potter (3XD)
JUDGMENT OF:	Hamilton J

COUNSEL :	M K Meek (P & XDs) R Dubler (1 & 2D & XC)
SOLICITORS:	Schrader & Associates (P & XDs) Corrs Chambers Westgarth (1 & 2d & XC)
CATCHWORDS:	CONVEYANCING [202] - Torrens system - Instruments generally - Other cases - Court order for rectification of registered leases - Appropriate form of order.
CASES CITED:	Toscano v Holland Securities Pty Ltd (985) 1 NSWLR 145 West End Motor Group Pty Ltd v Fisher [1999] NSWSC 1071
DECISION:	Orders for delivery of varying instruments in registrable form.

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

HAMILTON J

WEDNESDAY, 8 MARCH 2000

2673/97 WEST END MOTOR GROUP PTY LTD v FISHER & ORS

JUDGMENT

His Honour:
1    I delivered judgment in this matter on 9 November 1999: West End Motor Group Pty Ltd v Fisher [1999] NSWSC 1071 (“my judgment”). In my judgment I found that the plaintiff had established that there was in force at the time that the subject leases were entered into a concluded antecedent agreement to the effect claimed by it: [26]. That claim by the plaintiff was a claim that it was entitled to have the leases of the three Church Street properties rectified so that on a rent review to market the overall rental of the three should be assessed globally, then in effect divided equally between the leases of 584 - 586 and 588 - 590, leaving the rent of 590 - 594 at a nominal $2 per annum.

2    I directed that short minutes be brought in and short minutes were brought in and debated before me on 14 December 1999. Two problems were then raised. The first was a submission by Mr Dubler of counsel for the defendants, that the finding relating to the concluded antecedent agreement should be limited to the occasion of the second rent review, which was to occur at the end of the second year of the lease. The second problem was that I was not happy with the form of the orders propounded.

3    The effect of Mr Dubler’s submission would be that the agreement would not apply when, on the exercise of the options the terms of the leases were renewed and the rent for the renewed terms was to be fixed by a process of review to market similar to that stipulated for on the second rent review. In other words, whilst not entitled to a “windfall” at the second rent review, the defendants should remain entitled to one on the renewal of the terms. In submitting that the rectification should be so limited Mr Dubler pointed to conversations referred to in [8] and [9] of my judgment, which played a part in my coming to the conclusion that I did and in which there was specific reference to the second rent review at the end of the second year of the term. Mr Dubler’s submission was, in effect, that because of that reference my finding ought be taken to be limited to a finding that there was an agreement of the requisite sort in respect of the second rent review only, and that there could not be said to have been established with sufficient clarity an agreement relating to later rent reviews.

4    I do not accept Mr Dubler’s argument. It proceeds by plucking out and concentrating upon one piece of evidence to the exclusion of others. The relevant conversations also include reference to rent reviews generally. That there was special mention of the second rent review in my view arose in two ways: first, it was to some extent used as an example to illustrate how the agreement was to operate; secondly, the second rent review was in particular focus, because it was the subject of the concession which I found that Mr Dodd was prepared to make, namely, that that rent review should proceed not by a fixed increase of 5 per cent, but by a review to the market rental of the three properties overall. Reference to the second rent review must be viewed in the context of the whole of the conversations. It is also important to view the whole of the conversations in the context of all the evidence. That includes the references to the rental in the documents mentioned in [11], [12] and [16] of my judgment. In its naissance, the curious rent structure commenced with the apportionment of the rents of these properties in this way in 1992. I did not believe Mr Fisher’s evidence that he was an unwilling participant in that arrangement. In my view, the matter was arranged in that way with his knowledge and with his assent, so that the income from the three properties might be attributed wholly to the company, and not at all to himself, for purposes which I do not doubt that he then thought were advantageous to him. The whole course of the evidence shows that thereafter the properties were dealt with in that way and on that basis, namely, that the third property in Mr Fisher’s personal name should continue to bear a nominal rent only and that the whole commercial rent of the three properties should be divided between and attributed equally to the other two properties owned by the company. The finding which I have firmly come to on the evidence is that it was the intention of the parties at all times up to and including the entry into the present leases to deal and continue to deal with the properties on that basis. The specific references in the conversations that Mr Dubler has alluded to to the second rent review I do not take as detracting from that intention.

5    In those circumstances I do not intend to limit the orders for rectification as Mr Dubler has asked.

6 The other problem that has arisen is that I was unhappy with the form of the orders as they were brought in. They did not provide specifically for the manner in which each of the separate leases was to be rectified. Nor did they provide for the mechanism by which the rectifying provision was to be incorporated in the leases, which are registered under the Real Property Act 1900 (“the RPA”). The fact that the instruments are so registered does not preclude their rectification. But the rectification must be effected by the registration of a varying instrument in registrable form: see per McLelland J (as his Honour then was) in Toscano v Holland Securities Pty Ltd (1985) 1 NSWLR 145 at 152. Any problem that may have arisen before 1991 by reason of the lack of a statutory mechanism for the variation of registered leases was cured by the insertion in the RPA in that year of s 55A.

7    I have prepared a minute of the orders which in my view are appropriate, and that will be handed down at the same time as this judgment for the final consideration and comment of the parties before the orders are made. In particular, the parties may wish to consider more specific provision as to who is to prepare and who is to lodge the varying instruments.

…oOo…

Last Modified: 09/25/2000