Westralian Drug Holdings Limited v Moore

[2000] WADC 310

JURISDICTION     :   DISTRICT COURT OF WESTERN AUSTRALIA

IN CIVIL

LOCATION:   PERTH

CITATION:   WESTRALIAN DRUG HOLDINGS LIMITED -v- MOORE [2000] WADC 310

CORAM:   DEPUTY REGISTRAR HEWITT

HEARD:   21 NOVEMBER 2000

DELIVERED          :   29 NOVEMBER 2000

FILE NO/S:   CIV 4650 of 1999

BETWEEN:   WESTRALIAN DRUG HOLDINGS LIMITED (ACN 009 288 546)

Plaintiff

AND

BRUCE HERBERT MOORE
Defendant

Catchwords:

Practice - Western Australian - Application to attach a debt - Whether future rent payable under a lease can be attached

Legislation:

Supreme Court Act, s 126

Result:

Application dismissed

Representation:

Counsel:

Plaintiff:     Mr Rumsley

Defendant:     Not Applicable

Solicitors:

Plaintiff:     McKie & Associates

Defendant:     Not Applicable

Case(s) referred to in judgment(s):

Mitchell; Ivey v Lee; Jones (1867) LR2QB 259

State of South Australia v ATSA Pty Ltd 29 ALR 367

Tapp v Jones (1875) 10 QB 591

Case(s) also cited:

Progressive Mailing House Pty Ltd v Tabali Pty Ltd (1985) 157 CLR 17

1. DEPUTY REGISTRAR HEWITT:  At the request of counsel I record my reasons for dismissing the judgment creditor’s application for a garnishee order nisi against the tenant of a property owned by the judgment debtor.

2. The facts which emerge from the materials are:

   (a)The judgment debtor is the registered proprietor of Suite 1, 279 Lord Street East Perth.

   (b)The proposed garnishee is the leasee of the property under the terms of a lease under which he pays $450 per month plus outgoings

   (c)The lease term will expire on 15 July 2002

3. Section 126 of the Supreme Court Act provides the power to attach debts.  The relevant wording for the purposes of this decision is:

   "Debts legal or equitable, owing or accruing from any third person to a defendant…may…be attached to answer the judgment."

4. A debt is a sum payable in respect of a liquidated money demand recoverable by action (Stroud’s Legal Dictionary 4^th Ed).  As the matter comes before me there is no debt between the garnishee which satisfies that definition.  It is suggested however that the rental payable by the garnishee is a debt accruing within the meaning of s 126.

5. The applicant has cited a number of authorities to support the proposition that future rental payments may be attached to answer a judgment debt.  The first case relied upon is Mitchell; Ivey v Lee; Jones (1867) LR2QB 259. In my opinion that case does not support the argument. The facts quoted indicate:

   "On 29 October one Edmund Ivey was indebted to the defendant in the sum of £12-15-0 for occupation of certain premises of the defendant" (p 260).

6. Ivey was the garnishee and clearly the case related to rent which had fallen due not rent which in the future might fall due.

1. The next case relied upon is Tapp v Jones (1875) 10 QB 591. In that case the facts were:

   "An agreement of September 1874 was in force between Pooley the garnishee and the defendant under which Pooley was bound to pay the defendant a sum of money by monthly instalments of £10 each.

   On 22 December 1874 one instalment being due an order was made by a master attaching all debts owing or accruing from the garnishee to answer the judgments.  On 31 December 1874 another order was made by a master that the garnishee should pay the plaintiff the debt then due by him to the defendant and also the accruing debts as they become due."

2. That order was upheld on appeal Blackburn J (with whom Field J agreed) stating:

   "I have come to the conclusion that the true construction is that there is power to make an order against the garnishee for payment of his debts as when they become payable, instead of making a fresh order as each falls due." 

3. From my perspective the significant aspect of the case is that the debt was created by the agreement.  The debt therefore existed at the time of the application and was therefore capable of being attached.

4. Finally the applicant cited State of South Australia v ATSA Pty Ltd 29 ALR 367 which dealt with the obligation to pay tobacco license for the balance of the surrendered term of the license. The portion relied upon is at p 388 where the court stated:

   "And this is why an existing debt payable by instalments is attachable and a garnishee order may be made in such a case for payment of the future instalments."

5. The question posed by this application can be shortly stated.

6. Does a leasee by entering a lease thereby create a debt owing by himself to his landlord for all of the moneys payable for the duration at the lease?

7. The proposition only has to be stated to be rejected.  Leases are susceptible of surrender assignment, termination, variation and a myriad of other intervening events which makes it clear that the true relationship between landlord and tenant is not one of creditor and debtor.

8. Were I to make the order sought under this application and the garnishee to be ejected from the premises he would none-the-less be bound by the terms of the order to pay the rent to the judgment creditor even through his liability to the judgment debtor was extinguished.

9. In my view the only means by which the judgment creditor could secure the payment of the rental money would be by the equitable remedy of appointing a receiver.